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Wave of NYC hotel openings see operators trying new tactics to boost business Hotel operators are partnering with luxury condo developers & exploring “micro” options to lower prices
The Crown Building at 730 5th Avenue and a "Cosy" small room at the Hoxton at 97 Wythe Avenue in Williamsburg (Credit: Aman and Hoxton) There are an unprecedented number of new hotel projects opening in New York City. And operators are exploring news ways to lower prices — and raise them.
Two major trends have emerged among these new hotel offerings, according to Bloomberg.
Firstly, a slowing market has encouraged residential developers to work with luxury hotel brands. For hotels, the sale of expensive condos in the building can offset development costs.
That’s the case at the Crown Building at 730 5th Avenue , where luxury hotel company Aman Resorts is making its New York debut with 83 hotel rooms and 20 condominiums. An Aman-branded penthouse in the building went into contract for $180 million last year, The Real Deal previously reported. The cheapest rooms at the Aman hotel are expected to go for around $2,000 a night, according to Bloomberg. Vlad Doronin is developing the residential component of the historic property.
Secondly, more operators are exploring “micro-hotels,” with small, cheaper rooms but larger common spaces.
“Today, you can extract value by monetizing every bit of space,” Sharan Pasricha, chief executive officer of Ennismore, which opened the Hoxton in Williamsburg in 2018, told Bloomberg, “Rooftops have become revenue-generating. Ground floors have become community melting pots. Bakeries, flower stores, coffee shops—they’re all revenue-generating toys, as we call them.”
However, micro-hotels in the city have struggled to maintain the low rates they offered at opening. At the newly-opened Moxy Chelsea starting rates hovered around $159 a night but have now risen to around $400. Sister City, an offshoot of Ace Hotels, opened on the Lower East Side early this year with promotional rates of $99, but are now charging around $300. [Bloomberg] – Decca Muldowney
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