New York’s Hotel Market Outperforms National Rates

New York City’s hotel market has faced its fair share of challenges in recent years, but has spent 2025 overachieving.

The sector is outperforming the national average in several key metrics in the first six months of 2025, the Wall Street Journal reported. Combined with a steady flow of tourism in the past two years, the Big Apple is taking a bite out of its hospitality competition in other markets.

In the first half of the year, the average weekly occupancy rate of hotels in New York City was 82 percent, according to CoStar. That’s in line with the rate from last year and a staggering 20 percentage points higher than the national average.

Revenue per available room in the city per night averaged $238.93 a week, far outpacing the national average of the same metric, which didn’t even cross the $100 per week mark.

Last year, 64 million visitors streamed into New York City, approaching a record. The city’s tourism organization expects a similar number of visitors this year, a large majority of whom are domestic travelers.

Business travelers account for roughly a fifth of hotel rooms sold in the city. In more good news for hotel owners, the NYC Department of City Planning projects business travel into the city to be stronger than last year.

But the city’s hotel industry is also benefiting from critical legislative decisions made by local officials in recent years.

A 2021 City Council bill mandated a special permit for new hotel developments, virtually freezing the sector’s construction pipeline. While the bill doesn’t mean developers can’t build, it makes the process all the more daunting.

Additionally, the city started cracking down on short-term rentals in September 2023, preventing platforms from processing payments to hosts that were either unregistered with the city or didn’t have approval to rent their properties for fewer than 30 days. Instantly, 10,000 Airbnb listings vanished. Efforts to ease the restrictions have been thwarted, critics blaming the lobbying efforts of the hotel industry.

While New York is outperforming the national hotel market, it could soon run into similar issues. Foreign travel to the country is expected to wane as a result of the Trump administration’s visa policies. Economic uncertainty is hitting domestic travel, too.

In May, the city’s tourism organization lowered its forecast of annual foreign visitors. In recent weeks, the city’s occupancy rate and revenue per available room have also declined, according to CoStar.

— Holden Walter-Warner