NYC’s strong hotel pipeline pushes down occupancy, revenue: report

Development on track for 144K rooms by 2022, according to a report from NYC & Company

New York /
Dec.December 31, 2019 10:45 AM
Renderings of 450 11th Avenue and 350 West 39th Street (Credit: DSM Design Group and Gene Kaufman Architect)

Renderings of 450 11th Avenue and 350 West 39th Street (Credit: DSM Design Group and Gene Kaufman Architect)

UPDATED, Jan. 2, 2020, 9:05 a.m.: New York City’s booming hotel inventory includes 113 new developments set to open in the next few years, with just over half located outside Manhattan.

That’s according to the latest hotel development report from NYC & Company, the city’s official official marketing, tourism and partnership organization. The report projects that New York’s hotel inventory will reach 144,000 rooms by the end of 2021 — up 65-percent from the 87,000 rooms the city had in 2010, the New York Post reported.

Soaring tourism numbers have contributed to developers’ optimism, as 2019 saw a record of nearly 70 million tourists visit the Big Apple. But all of this new supply, as well as competition from Airbnb, has pushed occupancy down 1.3 percent, average room rates down 2.7 percent, and RevPAR down 4 percent year to date, according to November data from STR.

The city’s recent moves to restrict hotel development — above and beyond restrictions in manufacturing zones instituted in 2018 — may lead to another burst of activity to get projects in before the deadline.

Last week, The Real Deal used data from the same NYC & Company report for its ranking of Manhattan’s largest hotel projects. In that ranking, David Marx’s 450 11th Avenue and Sam Chang’s 140 West 28th Street tied for the No. 1 spot with 531 units each.

But New York already has a new No. 1. On Friday, Chang — who earlier this year claimed to be leaving the business to focus on pigeon racing — filed plans for his biggest hotel yet. The 34-story, 974-room development at 150 West 48th Street will be the ninth-largest in the city, and largest to be built in the past 35 years, according to CityRealty. [NYP] — Kevin Sun

Update: This story has been updated to clarify that the data regarding year-to-date changes in occupancy, room rates and RevPAR is from November.


Related Articles

arrow_forward_ios
The Roger New York hotel at 131 Madison Avenue, Larry Korman of AKA Hotel Residences and Joe Lubeck of Electra America (Google Maps, Getty, Electra)
Electra America JV nabs Roger hotel for $71M discount
Electra America JV nabs Roger hotel for $71M discount
The grand reopening: As restrictions lift, CRE markets race toward recovery
The grand reopening: As restrictions lift, CRE markets race toward recovery
The grand reopening: As restrictions lift, CRE markets race toward recovery
The commercial market was hit hard by the pandemic, and property tax revenue is expected to fall 5 percent. (iStock)
Tax bills show how much Covid devalued NYC real estate
Tax bills show how much Covid devalued NYC real estate
Acting Katara CEO Andrew Humphries and 355 West 16th Street (Google Maps, AHIC)
Katara Hospitality takes over Dream Downtown’s $125M ground lease
Katara Hospitality takes over Dream Downtown’s $125M ground lease
About 38 percent of New York hotels with loans in commercial-mortgage backed securities were 30 days or more past due in May. (iStock)
Hotels’ recovery taking longer in NYC than elsewhere
Hotels’ recovery taking longer in NYC than elsewhere
Gowanus Inn & Yard at  645-651 Union Street, Brooklyn, Sonder CEO Francis Davidson and Red Pine Principal Michael Federman (Google Maps, Sonder, Federman Steifman)
Sonder takes lease for 76-key Gowanus Inn
Sonder takes lease for 76-key Gowanus Inn
Starwood CEO Barry Sternlicht and Blackstone CEO Stephen Schwarzman (Getty)
Blackstone, Starwood up bid for Extended Stay America
Blackstone, Starwood up bid for Extended Stay America
Abraham Merchant of Merchants Hospitality, 11-01 43rd Avenue and Frank Brosens of Taconic (Merchants Hospitality, Getty, Savanna Rooftop)
Merchants Hospitality sells dormant LIC hotel for $38M
Merchants Hospitality sells dormant LIC hotel for $38M
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...