Forecast Shows Manhattan Hotel Rates To Rise

Manhattan hotel rates will increase slightly this year and by much greater levels in the subsequent years, but it will still take several years for rates to reach 2008 levels, according to the 2010 Manhattan Hotel Market Overview, which HVS Global Hospitality Services and New York University's Tisch Center released this week.

HVS forecasts that year-over-year Manhattan hotel rates will be up 2.2 percent in 2010, by 7.9 percent in 2011 and by double-digit levels in the two years after that. Considering the 22.8 percent year-over-year drop in rates in 2009 reported by Smith Travel Research, however, Manhattan average daily rates will not pass the $300 threshold, where they were in 2008, until 2013, according to the forecast.

The forecast said Manhattan revenue per available room also would reach pre-recession levels by 2013.

The report also included a survey of 68 Manhattan hoteliers, in which more than half said they expected corporate rates to increase between 1 percent and 10 percent by the end of this year. Hoteliers were less bullish on group rates, however. Just under 30 percent said they expected group rates to remain level throughout the rest of the year, while only 10 percent said corporate rates would be flat.