Town’s resort trade did not roll out the welcome mat for a sunny forecast from CBRE which claimed that pandemic-battered inns are doing simply superb.
Resort Affiliation of New York Metropolis president and CEO Vijay Dandapani threw shade on the true property firm’s rosy forecast as his group lobbies for an enormous lower within the metropolis’s resort occupancy tax from 5.875 p.c to 2.875 — in addition to for diminished property taxes.
Lawmakers are more likely to be much less receptive to the pitch if accommodations are in higher form that current gloomy experiences have advised. However as in most knowledge comparisons, there’s some reality to each views.
Dandapani mentioned CBRE’s survey, which The Submit reported on Tuesday, was off base in predicting a return to pre-pandemic occupancy and income by 2024.
“We’re cheerleaders for town, however there is a hole between expectations and hope,” Dandapani mentioned.
The optimistic prediction was written by Dan Hanrahan, CBRE senior vice-president of Accommodations Advisory for the northeast. Dandapani mentioned that Hanrahan’s forecast that revPAR — or income per obtainable room, a key trade metric — would “leapfrog again to 2019 numbers” this yr was “most unlikely.”
The Resort Affiliation’s personal knowledge for the primary 5 months of 2022 present common revPAR for this yr, nonetheless properly under 2019 — $155 in contrast with $184 earlier than the virus struck.Annie Wermiel/NY Submit
If it does, “We will all purchase a drink at Christmas,” Dandapani deadpanned.
CBRE based mostly its cheery forecast on knowledge from this yr’s first quarter, which confirmed upticks in occupancy ranges, room charges and revPAR.
The Resort Affiliation’s personal knowledge for the primary 5 months of 2022 present common revPAR for this yr, though rising on common from 2021 lows, nonetheless properly under 2019 — $155 in contrast with $184 earlier than the virus struck.
“With a purpose to catch up, revPAR must significantly exceed the present $155 for the remainder of the yr. Crossing the chasm isn’t not possible, however it’s unlikely,” Dandapani mentioned.
Furthermore, he mentioned that revPar in 2019 and in 2022 have totally different meanings, provided that town’s resort rooms shrunk from about 122,000 in 2019 to round 100,000 as we speak.
Luxurious-class inns such because the Baccarat, the St. Regis, Pierre and the 4 Seasons downtown are outperforming cheaper properties, he mentioned.
Luxurious-class inns like Pierre (above) are outperforming cheaper properties, Dandapani mentioned.Angel Chevrestt
However many accommodations in any respect value factors stay closed — from top-tier 4 Seasons on East 57th Avenue, to the mid-market Marriott Eastside on Lexington Avenue, to funds lodgings in Chelsea and the Far West Aspect.
“Most elected officers are pushing for altering closed accommodations to housing,” Dandapani mentioned. “What meaning is, there are quite a lot of closed accommodations” — and the losses have not been absolutely offset by current openings such because the Laborious Rock and Riu accommodations close to Instances Sq..
Different troubling “headwinds” embrace the sluggish return of worldwide enterprise journey and the near-complete lack of guests from China and Brazil.
However Dandapani acknowledged at the very least one promising important signal. Requested how a lot company have been paying per room as we speak in contrast with pre-pandemic days, he mentioned final week’s common price throughout all resort courses was $263 — “inside 5 p.c, inside placing distance, of 2019,” he mentioned.