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From SpongePedia, the First SpongeBob Wiki.
The Hotel Evil/Motel Evil/The Evil Hotel just appears in the episode The Bad Guy Club for Villains in the Lost Episode of Mermaid Man and Barnacle Boy.
The Bad Guy Club for Villains visit the Hotel for their Book Club. Mermaid Man and Barnacle Boy go there to see if they want to take over the world again, but then they notice that it is just a book club they are going to. It is unknown if the Hotel is still there.