The NoMad hotel market should be boosted with new properties

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25 West 28th Street (Google Maps)

NoMad is slated for the debut of several new hotels that could give a business boost to the region which is not used to large amounts of tourists.

Six hotels are expected to open in the neighborhood by the end of this year, Crain’s reported, boosting the area’s property stock by 25%.

The Ritz-Carlton New York, NoMad is set to open next month. General Manager Bastian Germer told Craiin’s he expects to be sold out at rates starting at $1,100 on Labor Day night by the end of the year.

Other hotels coming to the area this year include the Ned NoMad (replacing the NoMad Hotel), the Virgin Hotel, Hotel AKA NoMad, Le Meridien and the Fifth Avenue Hotel.

The NoMad Hotel serves as an example of the sector’s turnaround in the neighborhood. In May, billionaire investor Ron Burkle and hotelier Andrew Zobler faced foreclosure of the trendy hotel at 1170 Broadway, marking the second time they had faced foreclosure of the property.

At the end of the year, however, Safehold purchased the ground lease of the property for $77 million. Last month, Soho House announced that The Ned would open at the property. The 12-story building will feature a members club, restaurants and 167 guest rooms spread over 10 floors.

There are a number of attractions hoping to draw tourists to the neighborhood, which sits downtown from tourist mainstays like the Empire State Building and Times Square. The Harry Potter store is one such destination, buzzing with aspiring wizards since it opened a year ago. The neighborhood also has the flagship Milk Bar bakery, the Lego Store, Eataly and Madison Square Park.

Still, the city’s hospitality industry is struggling to recover from the pandemic, which has restricted travel, slowed occupancy and triggered a wave of closures across the city. The New York Hotel Association has reportedly asked the City Council to consider a steep reduction in the occupancy tax rate on hotel stays in an effort to increase visitation.

The association pushed City Council and Mayor Eric Adams to cut the rate to less than 3%, about half the current rate of 5.9%. Last summer, the tourist tax rate was temporarily suspended for several months during the summer.

[Crain’s] — HoldenWalter Warner

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