New York City hotel rates are hitting all-time highs ahead of the holidays — with luxury rooms at unprecedented levels and supposedly budget-friendly hotels increasingly out of reach for many tourists, The Post has learned.
The biggest hikes are happening at the poshest properties. At the recently renovated Four Seasons on East 57th Street, visitors on Thanksgiving can expect to pay $2,912 a night including taxes and fees for a 500-square-foot junior suite, according to the swanky venue’s site.
But sticker shock has been arguably greater at lower-tier venues. Last week, the Holiday Inn Express in Chelsea was advertising same-day booking for a standard room at a punishing $435 a night. Its site was asking $545 to book the same room on Thanksgiving, adding, ‘Well done! You’re getting a great price,” on a checkout page.
“We were surprised by just how expensive the nearby hotel options were,” said Lisa Hawkins, a spokesperson for the Washington, DC-based Distilled Spirits Council of the US who had to book rooms in Manhattan for a event the trade group hosted last week in SoHo.
“Even the more value-oriented hotels were around $550 a night, while some options exceeded $1,000,” Hawkins added. Ultimately, the trade group opted for a “budget-friendly” property near its event “given that we needed multiple rooms,” she said.
After hitting rock-bottom in the depths of the pandemic, New York City hotels have come roaring back this year. In September, nightly room rates in the Big Apple hit a record monthly average of $468.54 — exactly 96 cents above the previous all-time monthly average set last December, according to CoStar Group, a firm that tracks hotel data.
Despite record room rates, hoteliers claim they remain victims of relentless inflation – fueled by regulatory hurdles, utility costs, real estate taxes and the highest labor costs in the country – that continues to eat into profits.
“The hotel industry continues to face headwinds — not least because tourism is still below 2019 numbers,” said Vijay Dandapani, chief executive of the Hotel Association of New York City.
The trade group estimates that room rates will increase between 3% and 4% next year, roughly on pace with inflation. But citywide, this September’s average room rate is 7% above last year’s.
At this clip, “We could break another record in October,” said Didio Pequeno, director of hospitality analytics at CoStar Group. “There doesn’t seem to be a rate ceiling in New York City today.”
A city crackdown on short-term rentals from Airbnb and other booking services in 2023, known as Local Law 18, boosted hotels that were already enjoying a rebound in tourism that started in 2024, industry experts say.
The city’s tourism bureau – NYC Tourism + Conventions – expects more than 65 million visitors to come to the city in 2026 compared with more than 66 million in 2019.
Much of the recent business is being fueled by a surge in well-heeled domestic travelers, hoteliers say. The average nightly room rate for luxury hotels citywide shot up to $841 in September — a staggering 70% increase over $494 in September 2019.
“If you are in the luxury market, things are fantastic,” Dandapani said. “We are hearing that it’s a relatively new demographic” filling up the most expensive rooms.
“It’s generally wealthy Americans from other parts of the country who are 50 years-old or younger in their 30s, people who didn’t stay in the top hotels.”
A room at the Mandarin Oriental on Thanksgiving will cost $2,867 for a standard king-size bed with a view of the Hudson River. At the Baccarat Hotel in Midtown, a “classic king” runs $2,238 a night.
For lower-tier venues, price increases haven’t been as dramatic on a percentage basis. The average nightly rate for budget hotels in the city in September was $203 — up 23% from $164 in September 2019. Still, executives fret that higher room rates — especially in Manhattan — threaten to shut out an entire segment of tourists.
The Hilton Garden Inn on East 52nd Street had one room available at $523 on Thanksgiving as of Oct. 29, with the rest of its offerings priced at $750 and up — as high as $1,239 a night for a room with two double beds.
“We are attracting fewer budget conscious travelers,” Dandapani admits. “They don’t have the disposable income and we don’t have budget accommodations.”
Part of the problem is that many lower-cost hotels in the city were converted to migrant shelters during the past few years. Looking ahead, 79% of new hotel development will produce luxury properties, according to CoStar.
Most developers are focusing on luxury because a 2021 law has made it more cumbersome and expensive to build new hotels. The legislation imposed stricter labor mandates and an approval process that can take two years.
Still, for the second consecutive year, New York City is projected to lead the nation in new
hotel construction with 24 projects in the pipeline, adding 5,778 rooms through 2028, according to an October report by New York’s comptroller, Thomas DiNapoli.
“The New York City hotel industry ranked highest in the nation for hotel occupancy, room rates, and revenue per available room,” according to the report.
While 2026 had a number of major events that drew in more visitors, including the FIFA World Cup and the 250th anniversary of the United States, hoteliers say they expect the good times to continue next year.
“This was a very good year,” said Richard Born, owner of BD Hotels, which operates 24 properties in the city, including The Bowery, Maritime, The Jane and Mercer hotels.
“I don’t see anything that will make 2027 bad.”