New York Hotels Face Bankruptcy, Closures on Virus Travel Fears
(Bloomberg) -- The rapidly escalating restrictions on travel and social gatherings will make it hard for New York City hotel owners to keep creditors at bay, the head of a local trade group said.
Revenue per available room, a metric known as RevPar that combines occupancy and pricing, is down as much as 70% at some hotels, according to Vijay Dandapani, chief executive officer at the Hotel Association of New York City.
The virus outbreak has slowed travel globally and a new federal ban on inbound travelers from Europe will hit New York’s lodging business particularly hard. About one-third of overseas visitors to the city comes from European countries, according to tourism data published by Baruch College.
“We are likely to see hotel bankruptcies and closures over the next couple of weeks,” Dandapani said in an email.
RevPar declined 20% at New York hotels during the week ending March 7, as the spread of the novel coronavirus began to hit hotel performance. That was before widespread cancellations took hold, wiping out events like the Big East basketball tournament at Madison Square Garden and the St. Patrick’s Day parade.
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