NYC Will See 48 New Hotel Openings This Year with Hopes of a Tourism Rebound
After a rough two years, the hotel and hospitality industry is looking to the future.
New York City's hospitality industry took a significant hit due to the COVID-19 pandemic. Still, it's hoping for a brighter 2022 with the return of international tourists and a spate of new hotel openings.
The Wall Street Journal reports that 48 new hotels are expected to open in the five boroughs this year, adding an estimated 6,500 new rooms to the market. This is the second-most nationwide, behind only Austin, Texas. With another 121 new hotels in the planning or construction pipeline, the pandemic hasn't appeared to slow down investor enthusiasm for hospitality projects in the New York City market.
Some of the hotels slated to open this year include the boutique Wall Street Hotel in the Financial District, a Ritz-Carlton in NoMad, French outlet Hôtel Barrière Le Fouquet's New York in Tribeca, and the ultra-high-end Aman Hotel in NYC's iconic Crown Building. They're all pinning their hopes on a solid tourism rebound as they're adding rooms to an already crowded market. Despite the pandemic taking a bite out of tourism, there are now only 6.7% fewer hotel rooms operating than in 2019.
The city hit record levels of tourism in 2019, attracting 66.6 million annual visitors and capping off a decade of year-over-year growth that saw the construction of 41,000 new hotel rooms. The pandemic cut the number of tourists by 67 percent in 2020. However, things began to rebound last year thanks to the return of Broadway and other large-scale events and the US reopening its borders to most international tourists.
Some have expressed concern that the large number of new hotels could create an over-supply, driving down prices across the board. The Omicron variant once again upended travel plans this holiday season, throwing another wrench into the city's tourism recovery, and even Governor Kathy Hochul's recent budget predicted that NYC's hotel and tourism industries could take up to four years to recover all pandemic job losses.
Still, the increase of new business openings shows that many are optimistic about the city's ability to draw crowds again.
"The demand drivers have come back," said Joel Rosen, president of New York-based real estate development and investment company GFI Hospitality, in a recent New York Post interview. "The entertainment and leisure activities bounced back. The restaurants came back to resounding enthusiasm from locals and tourists. There is tremendous pent-up demand to travel. And rates have held pretty steady, which is surprising and helpful."