How does that work in practice?
The usual migrant hotels are bottom of the barrell, cheap, with low occupancy and often on the brink of closure. They tender for government contracts at low rates to fill rooms and feed the residents low cost food.
Hotels in middle class areas tend to be nicer hotels with better occupancy and higher room rates. Their food is more expensive and they usually have higher priced bars supporting them.
They probably arent going to bid for those contracts. If they did they arent going to be as competitive as the cheaper area hotels.
Which leaves two options, neither are of benefit to the British public.
Option 1 - The government forces a private commercial entity to accept an unwanted and lower than commercially viable government contract - which is authoritarian and results in enforced commercial loses of private business.
Option 2 - The government pays an inflated cost to the middle class area hotel and the tax payer picks up the bill. This comes with the added impact of the lower priced hotel, if holding the exisiting contract, closing down as most of the ones that have been awarded the contracts were on the brink of collapse. And, thats before we get to the frothing over migrants being housed in nicer hotels considering the they have branded the shittest-of-the-shit Britannia type hotels the height of luxury.