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Coming off their best year in two decades, New York City's hotels are turning on the marketing charm to keep sales strong and push their room rates higher.
Worried by the lack of major events, such as last year's 50th anniversary of the United Nations, hoteliers are shrewdly promoting everything from full-scale renovations to higher commissions for travel agents.
"In 1996, the hotel industry is going to have to figure out ways to continue to generate excitement about New York City," says Jonathan Tisch, president of Loews Hotels.
The hope is that profits, which last year finally grew enough to do more than pay debt service, can be increased to fund capital improvements. Consultants say that in 1995, many hotels attained the 20% profit margin that is desirable in the hospitality industry. Properties further improved cash flows by refinancing bankloans at lower interest rates.
But as analysts predict that occupancy levels will remain fairly static after hitting a saturated 79% in Manhattan in 1995, the pressure is on to bolster rates.
The average daily rate in Manhattan grew an estimated 5.5% in 1995, to $142.76, according to Smith Travel Research and Ernst &...