The Krusty Towers was a hotel and short-lived replacement of the Krusty Krab that opened in the episode of the same name. During its existence, Mr. Krabs planned on running a more successful and paying business, but service did not go the way he imagined.
It is a tall tower with 17 floors and the original Krusty Krab restaurant on top. Mr. Krabs also mentions an unseen pool being out back of the hotel. It has blue doors and the name of the hotel transcribed in red text.
The inside of the hotel consists of a lobby, several floors, and rooms. At the front desk in the lobby, a clerk has a bell, a guestbook, and keys to each room. It also has a guest elevator and an employee elevator, which is just a row of stairs. Most of the rooms look the same - except Patrick's room got covered in cheese and Squidward kept changing the scenery of his room until it went back to normal. Before the hotel's destruction, another pool was added inside on the top floor of the hotel, which weakened the building.
It all started when Mr. Krabs went to the fast-food convention, where he booked into a Fancy Hotel whose motto was "We shall never deny a guest, even the most ridiculous request." Before he left, he was charged a pricey hotel bill which demanded $25.00 for a hamburger. The costly service gave him the idea of a new money-making scheme, and thus the Krusty Towers was born.
When SpongeBob and Squidward hear about the story of the new hotel, they obtain new uniforms without additional staff. SpongeBob has no trouble following the motto, but Squidward refuses to do many things and eventually quits, coming back seconds later as a guest so he can abuse Mr. Krabs.
When Patrick makes a huge cannonball into the indoor pool, the hotel floors cave in, causing the entire hotel to collapse floor-by-floor until only the Krusty Krab itself is left standing, unharmed. Patrick, SpongeBob, Squidward, and Mr. Krabs are all badly injured and are sent to the hospital, where Mr. Krabs gets the idea of building his own hospital after receiving his medical bill. The hotel's design was the blame for the collapse.
Squidward asks where all the new hotel employees are, but he and SpongeBob are revealed to be the only ones. Mr. Krabs never gets any other employees because he will give a huge amount of money on the paycheck to his hired employee(s). Later, however, Squidward quits because he cannot stand being overworked by Krabs. Also, Mr. Krabs is shown to be an employee himself later in the episode.
The only known meal at the Krusty Towers hotel is the Krabby Patty. It can only be obtained by ordering room service and getting them made however wanted. The other meals are the same orders at the Krusty Krab.
The other meals known to be eaten were:
Krabby Patty with no crust or cheese (Patrick dislikes the crust)
50 Krabby Combo (Patrick and SpongeBob shared the meal)
Krabby Patty with toenail clippings and nose hair, without the cheese (ordered by Squidward for Mr. Krabs to eat)