Las Vegas hotels converting to hostels

Here’s some lovely news for you about the burgeoning hostel industry in Las Vegas.

As traditional tourists become scarcer in Las Vegas, a growing number of local hotels and motel chains are seeking salvation in a most unlikely business model: hostels.

Please tell me that this isn’t the future of hostels in the US.

"Maybe at $20 or $30 a room it is not worth it to keep the hotel open," [Grant Govertsen, a partner and analyst with Union Gaming Group] said, pointing to recent closures of the hotels at the Plaza and Binion's downtown. "But if you can jam so many people into a room, if it is not profitable, at least you can break even."

The trend doesn't surprise [Ran Tadmor, manager of Econolodge’s West Coast Hostel brand]who also converted the Tod Motor Hotel down the street into a hostel a few years ago.

"Now, they see an untapped market," Tadmor said. "You'll see a lot more coming."

I hope not.

This part sounds interesting for hostel enthusiasts:

Tadmor said the Econolodge couldn't have survived strictly as a motel anymore.

"The hostel is keeping the motel from closing," he said.

As strange as it is to ask, if the hotels and motels start praising the hostel model as the way to stay afloat in tough times, could we benefit from this? I have to wonder if it might lend some credibility to hostels among the general US population that is quick to mistake them for homeless shelters, flophouses, and brothels.

One big concern, then, would be if the hotel associations’ legal teams lobby for legislation that further blurs the lines between hotels and hostels and makes starting a real hostel nearly impossible without having the hotel aspect attached.

What do you think?