Michael R. Bloomberg
Mayor of the City of New York

As the "WORLD'S SECOND HOME," New York appeals to business and leisure travelers from every corner of the globe. In fact, we welcome more international visitors than any other destination in the United States with more than 5.3 million international visitors to our great city in 2004, an increase of more than 10 percent. The readers of Travel + Leisure confirmed our popularity by naming New York as the top city in the United States and Canada once again at the 2004 World's Best Awards.

Millions of people are discovering the rich diversity of our cosmopolitan city. New York City's accommodations, attractions, dining, entertainment, shopping, sporting events, theater, and performing arts are the best in the world. With 70,523 hotel rooms, New York offers visitors an unparalleled choice and new hotels are always being built, with new properties planned in Harlem and a major expansion in Brooklyn.

The thriving arts community welcomed the redesigned Museum of Modern Art, the Alvin Ailey American Dance Theater, and the Rubin Museum; while the forward momentum on the creation of a full Convention Corridor further secures New York's position as a top tier city for meetings, conferences, and trade shows. Successes such as the Republican National Convention, "The Gates, Project for Central Park," International Pow Wow, the 2010 Super Bowl, and the distinction of being the U.S. candidate for the 2012 Olympic Bid also demonstrate that New York is the premier destination for hosting world-class events.

There has never been a better time to visit the greatest city on earth. New York remains the safest large city in the United States and forecasts indicate that more than 40 million visitors will come to New York in 2005. Expect those visitor numbers to increase as more people experience the best of the Big Apple.

Jonathan M. Tisch
Chairman,
NYC & Company

Last year was an historic year for New York City's travel and tourism industry. We welcomed nearly 40 million people - an all time record that included new highs in domestic and leisure travel numbers, and after a three year decline, a double-digit surge in overseas visitor volume. Hotel occupancy was at its highest level in four years with a record 21 million room nights sold and today there is exciting hotel development taking place throughout the city. And there is more good news for the future, with construction of an expanded Javits Convention Center scheduled to begin later this year. Tourism clearly remains a vital and growing force for New York City's future.

Stephen Rushmore
President & Founder,
HVS International

HVS International is pleased to report on the relative strength of the New York City hotel and tourism markets. This incredible rebound after the events of 9/11 gives testimony to the reputation the City holds throughout the world as a commercial and cultural center of virtually unrivaled significance.

After three consecutive years of decline, hotel values in New York City increased substantially in 2004, ending the year slightly below 2000 levels. In 2004, New York City was among the top ten markets in the nation that registered the strongest percentage changes in value compared to the previous year. The typical hotel in New York City gained over $100,000 per room in value, which represents more than a 50% increase from the previous year. Due to limited new supply and increased compression resulting from near-maximum-capacity occupancy levels, we predict that RevPAR should experience double-digit growth for the next few years.

Optimism permeates the hospitality industry, but is especially prevalent in New York City. HVS forecasts that the rise in hotel values in New York City will accelerate during the next several years, surpassing the 2000 level by 2005.

Lalia Rach
Ed.D, Associate Dean
The Preston Robert Tisch Center for Hospitality, Tourism, and Sports Management

The New York City hotel industry has again established itself as the forerunner of industrywide success and change. On a grand scale, NYC hotel executives are redefining expectations for occupancy, rate, and profitability while at the same time revisioning products, services, and structures. Perhaps the song lyrics should be rewritten to read "when it happens here, it is expected everywhere!"

Cristyne L. Nicholas
President & CEO,
NYC & Company

Travel and tourism continue to thrive in New York City. This dynamic destination remains popular among domestic and international visitors, who are drawn to our world-class cultural attractions, restaurants, shopping, entertainment, and special events. In fact, New York City holds the position of being the number one U.S. destination for overseas visitors. Credit the remarkable resurgence of tourism to a combination of smart destination marketing, favorable currency exchanges, and a number of notable infrastructure improvements citywide.

At NYC & Company, we are confident in the growth of the city’s $24 billion tourism industry, which continues to be a vital contributor to the local economy, generating more than $1 billion in city tax revenues and supporting more than 290,000 jobs in all five boroughs.

Recent forecasts give us reason to be optimistic. Overall, air flights and passenger volume are up as a result of competitive fares and new routes in and out of the New York City area. While the 2004 figures have yet to be released, the latest projections reflect a new high of 39.6 million visitors, which includes a 4.0% increase in the domestic market over the previous year to 34.3 million. Estimates for international visitors indicate double-digit growth with a 10.2 percent increase to 5.3 million visitors, marking a first time rise since September 11.

Hotel occupancy for the first quarter of 2005 is on track to reach levels almost 5.0% above the same time last year. Projections include a 6.0% increase in January to an occupancy level of 72%, while February shows a potential increase of as much as 10% with an extra 85,000 room nights generated by “The Gates.” This moves the occupancy rate well above 80 percent, according to PricewaterhouseCoopers.

In 2004, hotel occupancy levels averaged 83%, with a current average daily rate of $216.00, representing a 6.7% increase and $18.00 more than 2003. New York City’s hotel portfolio continues to grow, reflecting a strong demand for our quality travel product. Notable new hotels and renovations include the Affinia 50, the Doubletree Metropolitan Hotel, the Hotel QT, the Solita Soho Clarion Hotel, the Dream, and the Hotel on Rivington. Properties under development include the Blue Moon Hotel, the Downtown Hotel, and The Paramount New York, which will be re-branded as the Hard Rock Hotel New York.

A number of exciting developments are underway. The creation of a modern cruise ship terminal on the Brooklyn waterfront and improvements to the Passenger Ship Terminal on the West Side of Manhattan will meet the demand for New York City’s growing cruise industry, while the expansion of the Jacob K. Javits Convention Center will further strengthen our appeal as a meeting and convention destination.

Mark Lomanno
President,
Smith Travel Research

The New York City hotel market has enjoyed a stellar 2004 and all signs point to another excellent performance in 2005. RevPAR in 2004 was $150.43, up an incredible 19.3% over 2003. The tremendous growth was fueled by an increase in rate of 10.6% and an increase in occupancy of 7.9%. We recorded the rate for the full year 2004 at $185.76, which, despite being the highest in the Top 25 largest lodging markets, was still $20.00 below the peak of the year 2000 when citywide ADR reached $205.04.

In 2004, New York City hoteliers sold more rooms than ever before, some 23.6 million, generating $4.3 billion in rooms revenue. It is worth noting that although the number of rooms sold was only 2.3% of the one billion rooms sold in the U.S. last year, New York City generates 5.0% of the nation’s rooms revenue.

Tuesday and Wednesday nights keep outperforming the other days of the week with achieved rates of over $190.00. Occupancy on those nights rose to over 85%. In addition, Saturday night’s occupancy over the last 12 months was recorded at over 85%, but the rate charged was only $183.74. While the Saturday night ADR climbed some $20.00 over the last three years, there is still some upward potential given the rates that were achieved prior to 9/11.

Joseph Spinnato
President & CEO,
Hotel Association of NYC

It is evident from the occupancy figures for the year 2004, and from the numbers which are coming in now for the first quarter of 2005, that the hotel industry is enjoying a positive and strong rebound. The city’s hotel professionals are continuing to express optimism for the balance of this year and also for going forward. As we look toward the rest of 2005, we know that New York’s Olympics chances received a major boost with the MTA’s approval of the New York Jets stadium bid. On July 6, the International Olympic Committee will announce its final selection for the 2012 summer games and,, hopefully, New York will be selected.

Also, recently New York City was selected by the National Football League to host the 2010 Championship Super Bowl game. This is contingent, however, on the completion of the Jets stadium, and a Super Bowl in New York City could not only generate additional jobs but more than $300 million in economic activity.

Finally, the now approved expansion of the Jacob K. Javits Convention Center is very exciting for all of us in New York City. The $1.50 fee per occupied unit became effective on April 1, 2005 and there is no question that the Javits Center is well on its way to the long awaited expansion.