Skilled nursing and hotels have been hit hard during the pandemic. But even if those assets are distressed, they're still prized by investors, although not necessarily as their original use. Increasingly, developers and investors are considering converting these distressed assets into more profitable uses, according to a new post by JLL. 

Conversions of hotels to apartments have received a lot of attention. For instance, Harbor Group International is providing $27.5 million to a hotel-to-multifamily conversion project in the Coconut Grove neighborhood of Miami. The borrower is AB Asset Management, which used the funding to acquire and redevelop the property into a Class A multifamily community that is expected to be completed in September 2022. 

But those hotel conversions aren't the only transformations that make sense, according to JLL. More than 1,600 skilled nursing facilities in the US could potentially close in 2021, according to analysis from the American Health Care Association and National Center for Assisted Living.