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Just As We Suspected: Manhattan Hotels Now Cost Less

April 16, 2009 at 6:04 PM | by | Comments (3)

For a while now we've been profiling the dropping room rates across the hotel world because we started to see some outrageous deals that you could not get in the boom years of 2006 or 2007. But now our suspicions have been confirmed. Ovation Travel has put forth a new report that states the nightly hotel rates in New York have dropped nearly 30 percent to an average of $284. The average room rate for 2008 during this time frame was $404.

The survey also studied 30 key global cities and found that room rates only increased in Abu Dhabi, Dubai, Milan and Tokyo. Pretty much every other major city experienced a room rate drop. This is all good news for travelers, especially visitors to Manhattan who had to put up with unreasonable price gouging for so long.

And while not everyone can score a room for under $150--this would be our hotel utopia--and some of the old school luxury hotels are holding onto their steep rates only to save face (cough, The Pierre, cough), Manhattan hotels are getting friendlier to tourists. So, are you coming here or what?

[Photo: CourtneyMay]

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@morganstan395

wha??

and those ovation people are smoking rocks if they think rates in dubai are up this year.  they're down like 20%.

bangerang on April 17, 2009 at 8:59 AM #Permalink

it's only the beginning

Were hotel rooms overpriced in NYC? absolutely. But I think the lower rates we're seeing now are just the beginning. There are a lot fewer travelers to go around these days, even in Manhattan. Throw in new hotels opening every other week with thousands of new rooms to fill, rates and tanking. Expect to see a lot more discounting, a lot more last minute deals, and more generous packages (3rd nights free, comp upgrades). Also expect to see slips in service as hotels cut on staffing, amenities, and building maintenance.
HighOccupancy on April 17, 2009 at 10:22 AM #Permalink

Supply Demand

There's no such thing as overpriced and underpriced hotel rooms. (except from the perspective of the individual buyer).

Hotel rates are based on the availability of a completely deregulated comodity.  (and a LOT of rate comparisons by revenue managers)

Pricing is absolutely and unequivocally based on supply and demand.  

The variations you might see within hotel classes only reflect different Rate vs Occupancy attitudes of Owners/Managers.  

Clearly the Pierre is following the Tiffany/Mercedes model of pricing. You don't see these companies slashing prices when the economy sours.  Doing so would only dilute their product image now and when the economy rebounds.

You can bet the Pierre is offering lower unpublicized rates to corporate customers without diluting their public pricing model.

meyekull on April 17, 2009 at 10:57 AM #Permalink
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