NYC bill aims to revive struggling hostel industry

A piece of legislation that would permit the licensing of hostels in the city is slowly snaking its way through City Council, the New York Observer reported.

The new law is part of an effort to correct the damage wrought by a 2010 bill — later crystallized into New York’s illegal hotel law — aimed at snuffing out short-term single-room occupancy residences and illegal multiple-dwelling lodgings that also wreaked havoc on the city’s hostel industry.

Resulting hostel closings cost the city $150 million and more than 200,000 tourists every year, according to some studies’ estimates.

Jerry Kremer, a former New York State assemblyman and founder of Empire Government Strategies, is behind the bill, which Mayor Bloomberg and Speaker Christine Quinn also support.

The measure calls for setting up an independent office within the city Business Integrity Commission for licensed hostels, defined as “class B multiple dwellings providing food, lodging and other services to travelers.” A hostel unit, by the law’s definition, sleeps four to eight guests and does not permit stays of more than 29 days.

The push to develop hostels in New York City comes alongside a growing trend towards funky boutique hotels and hostels, such as the New York Freehand location proposed by Sydell Group in May. The developer purchased three parcels on Wythe Avenue in Williamsburg, a neighborhood pegged as a potential hostel hotspot, for $10 million last year.

“The city is very underserved by affordable options for the youth and budget traveler, and this is not good for the culture of the city or for the economy,” Andrew Zobler, founder and chief executive of the Sydell Group, told the Observer. [NYO] —Julie Strickland