Downtown Sees New Lodging Boom

NEW YORK CITY-A 399-key Doubletree Hotel opened at 8 Stone St. a week and a half before Christmas. It marked the fifth lodging property to open in Lower Manhattan this year and increased the area’s room count to 4,100, a gain of nearly 80% since 9/11. To Elizabeth Berger, president of the Alliance for Downtown New York, “The volume of investment pouring into Downtown’s hospitality industry is further proof that the district has become one of New York City’s most desirable and dynamic locations for both business travelers and tourists.” The 44-story Doubletree, Berger adds in a release, represents a “fantastic addition to Lower Manhattan’s rapidly growing hotel landscape.” A few days after the Doubletree opened for business, the W opened what is described as “Manhattan’s first elevated hotel ice skating experience,” Skating in the Sky. Prior to the Doubletree’s opening on Dec. 14, 2010 saw the unveiling of the 220-room W New York – Downtown in June at 123 Washington St., the 169-room World Center Hotel in June at 144 Washington St., the 112-room Holiday Inn Express in May at 126 Water St. and the 253-room Andaz Hyatt Wall Street in January at 75 Wall St. In addition, three more lodging properties with a combined 285 keys are planned or under construction, according to the Downtown Alliance. The Doubletree brings the number of lodging properties below Chamber Street to 18. By comparison, the area had 2,300 keys in six hotels in 2001. In its third-quarter report on Lower Manhattan’s commercial and residential real estate, the Alliance noted that room pricing continued to improve citywide and in Lower Manhattan for the second consecutive quarter. This marked a reversal from the year prior, “when many hoteliers cut rates to bolster occupancy during a difficult market,” the report states. Indeed, a bar chart in the Q3 report shows Downtown’s hotel occupancy taking a steep dive as 2009 came to an end while improving substantially as the current year got under way. During Q3 of this year, Lower Manhattan’s average daily room rate was $287, remaining stable from the previous quarter and representing a 13% increase over last year, according to the Alliance. The report shows Downtown’s ADR is higher than that of the city as a whole, which was $245 as of Q3. The gap between Downtown and citywide ADRs has increased from a year ago, widening from $32 to $45. The Alliance attributes this to a slower pace in the ADR recovery citywide, a 10% year-over-year gain and a 1% decline from Q2 of this year. Meanwhile, Lower Manhattan’s Q3 hotel occupancy rate was 85%, a 3% dip from the previous quarter and the year prior. The citywide average declined 1% over Q2, but increased 2% over last year, according to figures from the Alliance and NYC & Co. As a further basis of comparison, Smith Travel Research reported that nationwide hotel occupancy for the week ending Dec. 18, the most recent week for which figures are available, stood at 46.5%, a 9.4% year-over-year gain.