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NYC Hotel Room and Occupancy Rates to Rebound Next Year

NEW YORK CITY-By next year, occupancy should reach 80%, up from the expected $76.5% for this year, and room rates should hit $220, just 60 cents below the high of 2000. Part of the decline in occupancy is due to a 3.5% increase in the number of hotels.

By John Howe | Updated on August 23, 2001

NEW YORK CITY-Next year, the city’s hotel occupancy rate will make a comeback and the average daily room rate will hit a new high, according to a forecast by PricewaterhouseCoopers, the professional services firm headquartered here. Occupancy will increase from 76.5% that the firm predicts for 2001, to 80% in 2002, a substantial improvement but below the record of 83.9% of 2000. By next year, the average daily room rate should reach $220, down just 60 cents from 2000. Last year’s rate was $219.50.

The decline in occupancy over the last year and a half is attributed to an increase of 3.5% in the number of hotels as well as a drop of 500,000 guests, to 8.2 million, as compared to the first six months of 2000. Occupancy and room rates will improve as new supply is absorbed, the economy revives and hotels refocus their marketing on small group meetings and leisure travelers, according to PricewaterhouseCoopers.

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