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NYC Tourism Sector Making Progress in Recovery as New Hotels Open

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By: Ellen Cans

The COVID-19 pandemic dealt a harsh blow to the hospitality industry. Many new hotels, which were in construction and faced building delays, are starting to open up, in time to test the market and the summer travel season. As reported by the Wall Street Journal, plenty of the new hotels are delaying their openings, but dozens of hotels are forging ahead on track with their estimated opening dates set for this year and early next year. In 2021, some 78 hotels with a combined total of 13,000 rooms, are slated to open, as per data firm STR.

Hotels that have already opened this year, include the 74-key Brooklyn Vybe Hotel at 1024 Flatbush Avenue, and the 33-room Baltic Hotel also in Brooklyn. At the end of April, SoHo saw the grand opening of the 114-room ModernHaus, replacing the former James Hotel. Among the largest hotels that will be opening this year is Arlo Hotels’ upscale hotel near Hudson Yards, which is expected to open its 489 rooms this spring.

The hotels deserve a good deal of credit for moving ahead with opening plans, despite the devastating effect the pandemic has had on tourism and travel. Hotel-room occupancy for New York was at just 53.8 percent for the week ended May 1, as per STR. The rate lags behind the national average of 57.1 percent, and is well below NYC’s 89.8 occupancy rate for the same week in 2019, according to STR. While there has been some improvement since the vaccine was rolled out, there are still below 37 million tourists expected to visit the city this year, compared with a record 66.6 million in 2019, as per NYC & Co., the city’s official tourism organization.

Regarding hotels that are not new, some 146 properties consisting of a total of 27,998 keys, have reopened, STR said. About 115 hotels, with 36,830 rooms, are still temporarily closed following the pandemic, while six have been permanently shuttered. The New York Hilton, one of the city’s biggest hotels, with over 1,900 rooms, still has no immediate plans to reopen, a spokeswoman told the WSJ.

Hotels are trying to time their openings just right—not too early so they don’t face too many vacancies, but also not too late so as not to lose out to other hotels which may earn customer loyalty. “That is the magic balancing act,” said Alex Ohebshalom, developer of the Fifth Avenue Hotel, a 153-room luxury development. That hotel completed exterior construction earlier in 2021, but is holding off opening till possibly the fall, when Broadway theaters are anticipating their reopening.

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