Highway 9 was closed outside Ben Lomond for at least two hours as firefighters fought the blaze.
"They made a great save," Cal Fire Battalion Chief Scott Jalbert said of the more than 100 firefighters at the scene.
The historic lodge and restaurant were saved, as was the nearby forest.
Lodge manager Andy Poon said he might be able to put residents from the 10 or 12 destroyed units in nearby motel rooms for the night. The American Red Cross was also available to help.
The original lodge, built in 1890 at what was then a lumber mill, now has 48 guest rooms and an 80-year-old restaurant. In 2007, Sanjiv Kakkar bought the lodge, then called Brookdale Lodge, and renamed it the Brookdale Inn & Spa.
Residents said there were no fire alarms or sprinkler systems in the two-story apartments and that a similar fire had destroyed units four or five years ago.
The cause is under investigation by the Boulder Creek Fire Protection District.
The slumlords still haven't fixed anything that burnt down last time.