We need small, low-cost housing (like (but hopefully better-managed) the Hotel Chateau, pictured left, on Broadway in Chicago's Lakeview neighborhood). It helps ensure that a broad range of people and businesses can remain in all communities. It's equitable and enriches the lives of everyone.
Residential hotels probably pre-date the 1920s, but many were built in that decade. At that time, they were promoted as a kind of glamorous living (every secretary, an actress! Every accountant, a playboy!). It is no surprise that, in Chicago, they can be found in high numbers in Uptown, a neighborhood named to evoke the nightlife of Harlem. They soon fell out of favor with urban middle classes and came to serve as low cost housing for those on fixed incomes. These remaining hotels are an asset for both their residents and their neighborhoods.