While hotel occupancy in Manhattan has risen dramatically from levels as low as 55 percent, the average daily rate continues to be lower than record levels achieved in 2007.
Nevertheless, the increase in occupancy represents a significant improvement to a market where more than 30 new hotels have opened during the year. Many of these new limited-service and boutique hotels, including Hotel Indigo, Ace Hotel and Crosby Street Hotel, have registered occupancy at nearly 90 percent.
From a national perspective, travelers are going to have it good next year.
Hotwire.com, a leading discount travel Web site, predicts that hotel prices will continue to drop in 2010 due to the slow recovery in business travel. It expects air travel prices to stay flat, due to a recent round of capacity cuts by airlines, which should compensate for the slow recovery in business travel. While this should lead to more price stability, it won’t be enough to raise fares for consumers.
People will obtain the best savings on vacations by purchasing vacation packages through online travel sites like Expedia.com, Hotwire.com and Hotels.com, as travelers begin to take maximum advantage of one of the safe mechanisms to discount vacation travel.
Travelers will be able to secure four- and five-star hotel accommodations at substantial discounts, with little difference in price between the two hotel classes, Hotwire.com says. The travel site concluded that with hotels feeling the recession pinch and trying to lure back business customers, consumers will be able to trade up across the board for luxury rooms, as the price levels of luxury hotels become increasingly compressed.
Exceptional hotel deals will continue to be available at up to 55 percent off regular rates in cities including Miami, Las Vegas, Los Angeles and San Francisco.
Industry leaders at Deloitte are cautiously optimistic in their tourism outlook for next year.
“Conditions appear to be stabilizing in the travel industry as signs of an economy recovery take hold,” said Adam Weissenberg, vice chairman and U.S. tourism, hospitality and leisure leader for Deloitte. “Room rates are still low, which is impacting revenue, but consumers are finding special offers and incentives on hotel accommodations which are helping to increase occupancy.” He added, “When business travel gets back on track, the industry will see further improvement leading to a more complete recovery.”
Michael Stoler is a columnist for The Real Deal and host of real estate programs “The Stoler Report” and “Building New York” on CUNY TV and on WEGTV in East Hampton. His radio show, “The Michael Stoler Real Estate Report,” airs on 1010 WINS on Saturdays and Sundays. Stoler is a director at Madison Realty Capital as well as an adjunct professor at NYU Real Estate Institute, and a former contributing editor and columnist for the New York Sun.