Hotel distress could strip NYC of $1.8B in tax revenue

The projected loss does not include property taxes, which are due July 1

New York /
Jun.June 19, 2020 09:35 AM
The St. Regis Hotel at Two E 55th Street (Courtesy Cvent)

The St. Regis Hotel at Two E 55th Street (Courtesy Cvent)

The loss of tourism alone could drain New York City of $1.8 billion in tax revenue from hotels.

The estimated loss includes $968 million in room-occupancy taxes and $342 million in other taxes, Crain’s reported, citing research from Oxford Economics. Property taxes paid by those businesses — due July 1 — were not included in that figure. (Though the real estate industry has called for the city to extend the payment deadline, no such measure has passed the City Council.)

Although hotels were allowed to operate during the pandemic, few travelers were looking for lodging during the widespread stay-at-home orders. As a result, some hotels closed temporarily, others closed for good — some to position themselves for conversion to office space. Other hotels have been in talks to serve as socially distant dorm rooms.

The city’s hotel occupancy reached a low of 15 percent in April, during the height of the pandemic. In June so far, it recovered to 45 percent, as tourism slowly crept back. Still, occupancy remains far behind the average for this time of year.

The American Hotel & Lodging Association, the lobbying group that commissioned the revenue study, is seeking a federal tax credit from Congress to incentivize tourism. [Crain’s] — Georgia Kromrei


Related Articles

arrow_forward_ios
Carpenter & Company's Richard Friedman and 2 Canal Street in New Orleans (Carpenter & Company, Google Maps)
New Orleans Four Seasons lands $315M loan from Madison Realty Capital
New Orleans Four Seasons lands $315M loan from Madison Realty Capital
120 East 39th Street (Hotels, Getty)
Short-term rental company taking over Midtown hotel
Short-term rental company taking over Midtown hotel
(Photo Illustration by The Real Deal with Getty Images and Americasroof at English Wikipedia, CC BY-SA 3.0 - via Wikimedia Commons)
Chinese firms bailing on US commercial market
Chinese firms bailing on US commercial market
711 Beach Avenue in Cape May, New Jersey and Icona president Eustace Mita (Google Maps, Drexel University)
Luxury brand planning $150M hotel in Cape May
Luxury brand planning $150M hotel in Cape May
The Gregory Hotel in the Garment District (Google Maps, Illustration by The Real Deal with Getty)
Booze bandits: Restaurant claims Gregory Hotel owners stole liquor
Booze bandits: Restaurant claims Gregory Hotel owners stole liquor
Sydell Group's Andrew Zobler and rendering of proposed dorm for Bard College students (LinkedIn, Sydell Group)
Sydell launches Brooklyn hotel with dorms for Bard students
Sydell launches Brooklyn hotel with dorms for Bard students
Related Companies founder Stephen Ross and 33 Hudson Yards (Getty Images, LoopNet)
Related eyeing sale of Equinox Hotel
Related eyeing sale of Equinox Hotel
Mayor Eric Adams and 700 Eighth Avenue (Google Maps, LoopNet)
Midtown’s Row hotel to house up to 600 migrant families
Midtown’s Row hotel to house up to 600 migrant families
arrow_forward_ios

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

Loading...