Twice the Space at Half the Price

Most of us think of states like Arizona or Florida when we dream about the location of our second homes. Rarely do we think that our second home may actually be in a five mile proximity from our office. But for some transferees, this has now become a place they call home, or what we in the industry term as temporary lodging.

Prolonged separation from a family is never easy. However today, mainly due to the sluggish real estate market, we are seeing extensions of months added to what is typically a 30 to 60 day stay.  The price tag on this “home away from home” can be difficult to swallow for most. I often see companies trying anything to find cost effective solutions for this issue, some of which end up adding significantly to the overall cost. One of these solutions is extended hotel stays. It is easy to think that a $100 a night published hotel rate might actually help you come out ahead in overall costs. But the important thing to remember about hotels is:  1) hotel rates fluctuate daily based on occupancy and day of the week, and 2) the tax alone on the daily hotel rate can sky rocket significantly depending on location. Does New York come to mind?

What I suggest is to first get over the initial sticker shock of the 30-day temporary lodging invoice. Instead, break the costs down into a daily rate and look at the overall savings that come with putting your employee into an apartment rather than a hotel. Not only do you give the employees the space that they will need to live comfortably, especially when the family comes to visit, they will also have most of the amenities that will ease their living accommodations, including a full kitchen. Companies also get the benefit of not having to pay a per diem for meals.  I am confident that in the long run, companies will find the temporary lodging to be the most cost effective solution.