It’s quite a good time to get a good deal on hotel rooms in New York City. Why? Bad weather, more rooms, the weak euro and Airbnb, according to a recent research note by Credit Suisse hotel industry analysts.
It’s quite a good time to get a good deal on hotel rooms in New York City. Why? Bad weather, more rooms, the weak euro and Airbnb $ABNB, according to a recent research note by Credit Suisse hotel industry analysts.
Revenue per available room—an important industry metric known as “revpar”—has slumped sharply at Big Apple $AAPL hotels in recent months. Citing data from hotel information provider STR, Credit Suisse analysts noted that in January alone revenue-per-room declined 18.6% from the prior year.
Join 500,000+ readers who start their day with Quartz.
By subscribing, you agree to our Terms of Service and Privacy Policy.
Inclement weather, of course, played a role too. But other analysts noted how other structural changes such as a growing supply of hotel rooms and a weakening euro—thanks to the European Central Bank—are making New York less of a bargain for continental visitors. And they also noted that Airbnb is putting pressure on hotel prices, especially at smaller boutique locations.
Credit Suisse analysts write:
We are hearing hotel operators more often cite emerging sources of distribution/supply such as Airbnb as placing pressure on marginal locations, independents, and less well known boutiques … Bookings in three Manhattan districts including the Lower East Side/Chinatown, Chelsea/Hell’s Kitchen, and Greenwich Village/SoHo accounted for more than 40% of private stay revenue during a recent review period.
With as many as 10k units or more available at a time, we can see that on the margin this excess capacity can place pressure on a number of hotel locations that rely on leisure demand for those with an appetite for value/adventure.
