Skift Take

Getting tourists while they are young is critical.

Young budget tourists are putting off trips to New York City. Maybe it’s because they are finding it harder to find affordable rooms.

“It’s been clear that we’ve been underserved from a youth perspective in particular,” said Fred Dixon, CEO and president of NYC Tourism + Conventions. Dixon was moderating a tourism panel hosted by the Association for a Better New York.

Tourists often make repeat trips to New York. Getting them while they are young is critical. New York City, however, is at a disadvantage here. “Accessibility is key, and we can’t compete with other cities in that way,” he said.

That’ll be harder as hotel room rates climb. The average daily room rate in New York through October was $288, up from $241 in 2019, according to CoStar. That 19% jump tracked right with the average overall inflation nationwide in the period.

“If you’re a current operating hotel owner or just an operator, you’re doing really well,” said Vijay Dandapani, CEO and president of the Hotel Association of New York City.

‘Affordable Tourism’ Policies

To give budget tourists more options, the city needs to make existing laws friendlier to hostel development, said Dandapani. Other major cities like Paris, Chicago, Boston, and London are outcompeting New York City in this regard.

“You’re cutting out these people who otherwise come on a shoestring budget,” said Dandapani. “We talked about affordable housing, but we need affordable tourism.”

New York City’s sheltering of migrants in some hotels has been a big contributor to the pricing jump, said Dandapani. 

“We have the odd situation of 15,000 rooms [withdrawn from the system] giving to a crisis that we have. It really causes amazing compression,” he said. 

The recent crackdown on short-term rentals has not caused hotel prices to rise, the hotel association executive claimed.

Airbnb CEO Brian Chesky said recently that hotel prices are “already” rising in New York because of the recent crackdown. “A lot of people can’t even afford to go there anymore,” he said in a third-quarter earnings call. 

Dandapani also pointed to the long permit approval process as a contributor to rising hotel prices.


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Tags: airbnb, budget travel, hostel, new york city, tourism

Photo credit: Vijay Dandapani, CEO and president of the Hotel Association of New York City (center); Peter van Berkel, chairman for the International Inbound Travel Association (right); Leecia Eve, member of board of Commissioners of the Port Authority of New York and New Jersey (left) Dawit Habtemariam

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