B is the only option that the Real Estate developers have to be considered about.
A - The argument does not consider the local population growth- This is irrelevant
B - If the demand for office spaces (consequently the price) of per Sq foot area of office space is > than per sq foot area of a hotel room then clearly the Real estate developers would have made a wrong choice if they convert office space to hotel rooms.
C - The Estate developers need not be concerned with other travel related services, because they are not providing this service, hence won't affect their balance sheet.
D - Another irrelevant option.
E - If we observe the stimulus carefully the question talks only about hotel rooms. The stimulus does not provide any information about a possibility of distinction between hotels and office spaces converted to hotels. We can safely eliminate this choice.