Once Ubiquitous, Korea’s Motels Quietly Disappear (Image courtesy of Yonhap)
SEOUL, Feb. 3 (Korea Bizwire) — South Korea’s once-ubiquitous motels — long associated with budget travel and so-called “love hotels” — are quietly disappearing, squeezed by shifting travel habits, weaker profitability and the rise of alternative lodging, according to industry data and experts.
While the term “motel” has no formal legal definition in South Korea, government statistics on lodging businesses point to a clear decline in traditional inns and motels.
The number of motel and inn operators nationwide fell to 17,621 as of November 2025, down nearly 16 percent from 20,939 before the Covid-19 pandemic in late 2019, according to the National Tax Service. In Seoul, the drop was sharper: nearly 30 percent over the same period.
Other datasets tell a similar story. A nationwide business census shows the number of inn-type accommodations — a category that includes motels and traditional lodgings — steadily shrinking over the past two decades. Meanwhile, newer forms of accommodation, such as “lifestyle lodging” facilities and serviced residences, have expanded rapidly.
Of the more than 5,200 lodging facilities that opened between 2020 and 2025, fewer than 8 percent were inns, while nearly two-thirds were lifestyle accommodations. By contrast, most closures during that period involved inns and small traditional lodgings.
As Profits Shrink, Korea’s Traditional Motels Give Way to New Lodging Models (Image courtesy of Pixabay/CCL)
Demand has also waned. According to a national travel survey by the Korea Culture and Tourism Institute, motels and inns accounted for just 4.2 percent of total lodging use in 2024, down from 6.2 percent in 2020.
Industry experts cite multiple forces behind the decline. Domestic travel has become more experience-driven and upscale, while business trips have fallen as video conferencing replaced face-to-face meetings after the pandemic.
Budget rooms offering little more than a bed and television have struggled to compete with hotels, pensions, and short-term rentals such as Airbnb, as well as an increase in unlicensed accommodations in urban areas.
Demographic changes have also played a role. The growth of single-person households has reduced the need for short-stay motel use, while aging motels in city centers are increasingly redeveloped into officetels, retail spaces or shared housing.
At the same time, rising land prices and tighter financing conditions have made it difficult to build new motels.
Regulatory complexity has added to the strain. South Korea’s lodging sector is governed by a patchwork of laws overseen by multiple ministries, with no clear statutory definition distinguishing motels from inns or small hotels.
Industry representatives argue that licensed operators face heavy compliance costs — including taxes, insurance, fire safety and sanitation rules — while illegal lodging businesses often evade oversight.
Surviving operators are adapting. Many are rebranding as “small hotels” or “stays,” upgrading facilities and adding rooftop lounges, themed rooms and local tourism programs. Rather than relying on high room turnover at low hourly rates, operators are increasingly targeting higher nightly prices by emphasizing design and experience.
“The old motel model no longer works except in very limited areas,” said Lee Gil-won, head of a lodging consultancy. “Without differentiation and a clear concept, it’s hard to survive.”
As policymakers debate how to modernize lodging regulations — including whether to legalize domestic short-term rentals — the motel’s long fade appears less a sudden collapse than a gradual retreat, reflecting broader changes in how South Koreans travel, work and live.
Lina Jang (linajang@koreabizwire.com)
