The Real Deal New York

New union-supported hotel ban could drive tourists to Airbnb: REBNY

Industry group says city needs to consider broader impact of special permits in manufacturing zones
By Rich Bockmann | November 08, 2017 02:15PM

John Banks, Peter Ward and proposed hotel special permit areas of applicability (Credit: City Planning via New York YIMBY, Click to enlarge)

The influential hotel workers union that’s battled with Airbnb could actually be driving more tourists into the arms of the enemy with an effort to effectively ban new hotel development in large swaths of the city, the Real Estate Board of New York argues.

The New York Hotel Trades Council, led by powerful union boss Peter Ward, is one of the driving forces behind a city proposal to require special permits for new hotel development in city manufacturing zones.

But choking off new supply could end up increasing demand for home-sharing sites like Airbnb, REBNY argued in testimony submitted to the City Planning Commission on the proposal.

“[I]f the proposed action will significantly restrict the supply of hotel rooms, it is reasonable to expect that more tourists will seek accommodations outside of traditional providers,” the industry lobbying group wrote in its testimony. “As short-term rentals through companies like Airbnb become more prolific, along with the attendant negative consequences, the city has to take into account how its actions impact that market.”

Mayor Bill de Blasio, who coasted to a second term with his election victory Tuesday, first laid out his plan in late 2015 to limit development of hotels and self-storage facilities in M1 zones, ostensibly to preserve manufacturing jobs.

But the move is seen as a handout to the hotel workers union – which despite its relatively small size is one of the largest political spenders – and would impact areas that have seen the most development in recent years such as the Garment District, the Meatpacking District and NoMad, as well as areas of Long Island City and Downtown Brooklyn.

“The proposed action is an unnecessary constraint on the rights of property owners to address a market condition that needs no correction, and appears to be motivated by factors unrelated to sound planning,” REBNY argued.

The Department of City Planning in September laid out the broad points of how it will study the potential impact of the proposal, the first step in the public review process that will ultimately require approval from the City Council and the mayor.