The rental apartment market also got in on the hyperbole. The apartment vacancy rate descended to well under 5 percent. Rents, too, climbed—the average rent for a one-bedroom, in a non-doorman building below 100th Street, was over $3,000 in July, according to brokerage The Real Estate Group New York.
The middle of this decade was a great time to be a Manhattan real estate market.
The hotel market became no exception. In 2005, the annual occupancy rate for Manhattan hotels hit a record 86.1 percent. Similar and higher rates had been reached at various times going back to the early 1970’s, according to PKF Consulting, but no matter—the hotel market had its hook. Soon, stories came that, like The Times’ July 2000 one, regaled the public with tales of greater tourism and hard-to-get hotel rooms.
The superlatives were buoyed by increasingly expensive room rates. The total average rate for 2006 would be $271.08, and it would be $273.72 by the middle of 2007.
Still, Manhattan hotels are not necessarily raking in monies from their rooms. The industry uses a shorthand called RevPAR to measure the revenue garnered from available rooms. And about two-thirds of a hotel’s revenue comes from rooms, with the rest from ballrooms, valet services, bars and the like.
The RevPAR now, in the golden age, is similar to that in 2006 or even 2005. It averaged $231.80 in 2006, according to PKF Consulting, and $209.20 in 2005, the first year RevPAR averaged over $200. By the end of May 2007, it was $230.34.
So, if hoteliers really want a bigger bite of profit from your typical higher-end hotel bill, they have far to go. For now, whatever the perception, Manhattan’s hotels remain a relative steal for guests, especially those from certain points overseas. It’s the hoteliers who are spending big.