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The hotel fared well enough during the Depression years; the seventh floor was retrofitted in [[1931]] to accommodate the [[WCOA]] radio studio, and in [[1934]] artist [[Joy Apostle]] painted murals in the main lobby and dining room. The future of the hotel seemed assured, and when ownership passed to the [[Hagler family]] after Harbeson's death, new expansion plans were announced. However, with the advent of roadside motels in the 1950s — conveniently spaced every few miles along the highway, offering air-conditioned rooms at inexpensive rates — the San Carlos could not compete. It entered a period of decline and neglect from which it would not recover.
The San Carlos Hotel ceased operations in [[1982]] and lay vacant for more than a decade. After a proposal by [[Baptist Health Care]] to convert it to retirement apartments failed to materialize, the hotel was demolished in [[1993]]. A new [[United States Courthouse]] was later built on the sitein [[1998]].
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