The New York City hotel market has finally begun its long-awaited performance turnaround. While there is still much work to be done, the underlying fundamental of any recovery, strong demand, is on the way back. Through March of this year, the city has now had six consecutive months of demand improvement when compared to the same month of the prior year. While the comparisons are certainly easy, it nonetheless indicates improvement. The next challenge will be in increasing room rates, which are still well below the levels reached in mid 2008. To date, room rate recovery has not begun, and in fact rates are still declining slightly. Hopefully, increased demand, along with occupancy levels approaching the high 70s, will begin the room rate recovery process.