NYC hotel developments surging

Demand from publicly traded investors has surged property prices and made the development of new hotels a cheaper option in New York City, Bloomberg reports.

Many hotel developers who discontinued construction in NYC boroughs during the recession are now taking advantage of a rise in commercial real estate prices that have reached its highest point since 2006.

According to the news source, developers are planning to complete the construction of 50 hotels in NYC through 2013, and 68 through 2014.

This year through September, Manhattan hotel properties sold on average for $505,157 per room, a rise of more than $150,000 from last year. Bloomberg suggests that companies are developing hotels for as little as $300,000 per room.

"Right now, it can be cheaper to build than to buy in New York," Bruce Ford, senior vice president of sales at Lodging Econometrics, told Bloomberg. "Most developers would argue that it’s better to open a hotel in 2013 than in 2012, but in New York City, a market that leads the cycle, next year should be good."