WEST SIDE STORY New York provides us with some guidance, but with a few caveats. In the 20 years to 2006, New York’s hotel inventory expanded annually by only an average 1.1 per cent. Then began a major hotel building programme that saw the city’s stock expand by 2.7 per cent in 2008 and more than 5 per cent every year since. In total, New York’s room stock has increased by a huge 24 per cent in the five years to 2011. Between now and 2014, the city is poised to add another 6,200 rooms, a further 7 per cent increase, which will bring the city’s active inventory to 96,000.
In this boom period, 40 per cent of the openings were outside Manhattan, a total of 7,500 rooms in areas like Queens and The Bronx. The boom is not over yet, as New York anticipates 36 openings in the next 30 months.
Since 2002, 166 hotels have opened in the capital, of which 74 have been midscale properties
Olympic Park, on July 21, was £99.95, when searched in March. A booking for a week
later, when the games begin, means it soars to £252.57. Other sources confirm the price hikes and underline that it is not a time to be organising business meetings. Hotels.com puts the average price of a room during the Games at £213 a night, a 102 per cent increase year-on-year, compared with a worldwide 4 per cent average increase, while reservations technology firm Travelclick estimates rates are up 118 per cent during the Games. It is currently a seller’s market and will remain so from July 27 until September 9, when the Paralympics end, but what happens once the spectators have gone home and the unlikely pairing of hotels near Heathrow and tickets for the weightlifting at Excel ceases to be a premium sales opportunity?
There is clearly demand, as the city’s 2011 average occupancy rate of 85.3 per cent shows, but the average room rate is still lagging behind pre- recession level. How much of this is due to the recession hangover and how much from the new capacity coming online is debatable. “A lot of these are still very new,
so the overall cost of a room night hasn’t yet been brought down, but the average cost is still considerably