New York Hospitality Market Report
2023 Investment Forecast
Record Number of Keys Will be Added to the Market;
Buyers Pursue Upscale Assets as Casino Bids Ongoing
Supply infusion arrives as international and business travel still recuperating. In 2022, domestic tourism outperformed city government expectations, with such visitations exceeding the 2019 equivalent by 112 percent. International travel will take longer to recover, though gains in this category should still support increased occupancy in 2023. On a less positive note, the overwhelming majority of Manhattan employers still operate on remote or hybrid schedules, potentially impacting business travel. According to the Partnership for NYC, average office utilization in this borough stood at 52 percent as of January 2023. The metro also faces hurdles from the supply side. New York enters 2023 with the country’s largest hotel pipeline, of which 9,400 doors are projected to come online this year, beating the previous record achieved in 2021. The resulting 11.5 percent supply increase will frustrate recovering occupancy, with the average annual rate remaining several percentage points under the 85-plus percent norm observed leading up to the pandemic.