What to Do With Hotels That May Never Reopen Due to COVID
One feature of post-COVID New York City just may be large, hulking, dark buildings, a legacy of the hotels that have or will have closed permanently due to an extreme revenue shortage brought about by lockdowns that deprived them of their clientele.
"It's costing them hundreds of thousands of dollars [a month], or, in some cases, higher than that, to remain closed," said Sean Hennessey, chief executive officer of Lodging Advisors and an assistant professor at the Jonathan M. Tisch Center of Hospitality at New York University. "In order for these hotels to reopen, the numbers could be in the many millions of dollars. Employees are scattered and need to be re-hired or retrained. Right now, the outlook looks painful."
The pandemic and the wreckage to the top line of each hotel's balance sheet has accelerated a trend that was already under way, Hennessy said. That is, many Manhattan hotels are more than 50 years old and approaching the end of their useful life. The hotels on the Upper East and Upper West sides are the most prone to this phenomenon, he said.