NEW YORK CITY-A 399-key Doubletree Hotel opened at 8 Stone St. aweek and a half before Christmas. It marked the fifth lodgingproperty to open in Lower Manhattan this year and increased thearea’s room count to 4,100, a gain of nearly 80% since 9/11.

To Elizabeth Berger, president of the Alliance for Downtown NewYork, “The volume of investment pouring into Downtown’s hospitalityindustry is further proof that the district has become one of NewYork City’s most desirable and dynamic locations for both businesstravelers and tourists.” The 44-story Doubletree, Berger adds in arelease, represents a “fantastic addition to Lower Manhattan’srapidly growing hotel landscape.” A few days after the Doubletreeopened for business, the W opened what is described as “Manhattan’sfirst elevated hotel ice skating experience,” Skating in theSky.

Prior to the Doubletree’s opening on Dec. 14, 2010 saw theunveiling of the 220-room W New York – Downtown in June at 123Washington St., the 169-room World Center Hotel in June at 144Washington St., the 112-room Holiday Inn Express in May at 126Water St. and the 253-room Andaz Hyatt Wall Street in January at 75Wall St. In addition, three more lodging properties with a combined285 keys are planned or under construction, according to theDowntown Alliance.

The Doubletree brings the number of lodging properties belowChamber Street to 18. By comparison, the area had 2,300 keys in sixhotels in 2001.

In its third-quarter report on Lower Manhattan’s commercial andresidential real estate, the Alliance noted that room pricingcontinued to improve citywide and in Lower Manhattan for the secondconsecutive quarter. This marked a reversal from the year prior,“when many hoteliers cut rates to bolster occupancy during adifficult market,” the report states. Indeed, a bar chart in the Q3report shows Downtown’s hotel occupancy taking a steep dive as 2009came to an end while improving substantially as the current yeargot under way.

During Q3 of this year, Lower Manhattan’s average daily room ratewas $287, remaining stable from the previous quarter andrepresenting a 13% increase over last year, according to theAlliance. The report shows Downtown’s ADR is higher than that ofthe city as a whole, which was $245 as of Q3.

The gap between Downtown and citywide ADRs has increased from ayear ago, widening from $32 to $45. The Alliance attributes this toa slower pace in the ADR recovery citywide, a 10% year-over-yeargain and a 1% decline from Q2 of this year.

Meanwhile, Lower Manhattan’s Q3 hotel occupancy rate was 85%, a 3%dip from the previous quarter and the year prior. The citywideaverage declined 1% over Q2, but increased 2% over last year,according to figures from the Alliance and NYC & Co. As afurther basis of comparison, Smith Travel Research reported thatnationwide hotel occupancy for the week ending Dec. 18, the mostrecent week for which figures are available, stood at 46.5%, a 9.4%year-over-year gain.

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Paul Bubny

Paul Bubny is managing editor of Real Estate Forum and He has been reporting on business since 1988 and on commercial real estate since 2007. He is based at ALM Real Estate Media Group's offices in New York City.