The Standard, the Ace, the Jane, the Cooper Square; now, or very shortly, these stylish hotels will be adding hundreds more rooms to New York’s existing 85,000. Any expansion at this moment in time seems odd, but a hotel boom—with the resurgent dollar scaring off Europeans and business travel slowing to a crawl—feels particularly ill-conceived.
Of course, these properties, and the 35 others set to open in 2009, have been in the works for years, planned when occupancy rates were reliably in the 80-plus percent range. (There were a record 47 million visitors in 2008, up a million from the year before.) No wonder hoteliers expanded.
“It was healthy from the second half of 2003 almost to the day Lehman Brothers fell apart,” says Sean Hennessey of the hotel consulting firm Lodging Investment Advisors. According to Smith Travel Research, occupancy rates in the city dropped from 82.8 percent to 75.7 percent during last year’s prime October and November months. Travelers used to book about four days ahead; now, one. Groups reserved a year, even two, in advance. Now, industry analyst John A. Fox of PKF Consulting says, a week is not unheard-of.
In this tighter fiscal universe, to keep the necessary 60 to 70 percent occupancy (and with expense accounts fading into memory), even these beautiful new hotels will have to have invent new pricing and incentive packages (free breakfast, parking, theater tickets), says Hennessey. Which, frankly, appeals to locals too. In fact, it’s a great time to spend a leisurely weekend in one of these cool new places; there’s no need to change your money, you get some free shampoo, and you don’t even have to make your bed.