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Business Travelers Face Disappearing Hotels in New York City

The Big Apple’s once-robust portfolio of business hotels is shrinking as properties erode, open as shelters or shutter for good

A year ago, The Umbrella Hotel in New York’s Kew Gardens was just another close-to-JFK-and-LaGuardia people mover. In fact, it earned the nickname “Crew Gardens” for the number of airline pilots and flight attendants who overnighted there.

It was also a familiar room for a New York layover for business travelers who wanted to stay close to the airport but get a chance to see the city or attend a meeting or two.

The property has gone through several incarnations and was formerly a Comfort Inn. The rooms were clean and functional. Staff were impassive but polite. Rates were relatively low so it was featured on many online booking engines as a good value.

Post-COVID-19, The Umbrella is a hotel that has gone to the dark side.

Two recent shootings and nightly raids by police for parties ignoring social distance, alcohol and other violations including prostitution and drug raids have the quiet neighborhood of Kew Gardens up in arms against the hotel. The situation got so bad that the New York Post recently called the Umbrella, “Hotel Hell.”

At a recent neighborhood meeting, State Assembly Member Dan Rosenthal told Forest Hills Patch, “They don’t care about the community they are in. They care more about money than the community safety.”

The meeting was reportedly ignored by the hotel’s owner and also by city officials who could close the hotel.

Those same city officials are also coming under fire by Upper West Siders for transforming hotels like The Lucerne, formerly a $200 a night hotel, into homeless shelters. Prior to COVID-19, The Lucerne was a favorite booking for business travelers whose companies wanted a comfortable, safe room within taxi distance to Midtown but with more reasonable rates than The Plaza or trendy downtown hotels.

Today, the Lucerne is a makeshift homeless shelter where people are housed who can’t isolate any other way. Other hotels used by business travelers which are now homeless shelters include The Holiday Inn Express on West 48th Street, The Cachet Boutique Hotel (formerly a $300 a night property) across the street and The Travel Inn on 42nd Street.

The city won’t reveal how many working hotels have been converted to shelters but WABC-News says the number was over 100 this summer and city officials say that they may stay that way for over a year.

The hotels who pivot to sheltering these vulnerable populations are also compensated for the new residents. The Lucerne’s owner says the move, done in tandem with the Hotel Association of New York City was a “matter of survival,” as it needed to fill empty rooms to stay in business.

Homeless advocates say the properties would be dark if they hadn’t been taken up and used by the city to isolate its most vulnerable population, a population that is so often overlooked or abandoned especially in a crisis.

Recently, groups of local activists have been protesting the switch from hotel to shelter because they say the newly moved-in sheltered population are menacing neighbors, relieving themselves on sidewalks and panhandling on the streets.

Some larger properties like the InterContinental Times Square,which had been housing first responders and is not yet officially open, are renting out space to companies for remote workers. The rentals, either by the day or for longer periods in a hotel-into-work-space scenario, are helping keep the property afloat until traditional customers come back.

But not all properties have either the bandwidth, the real estate or the architecture to move in that direction. Like the city’s restaurants, hundreds of hotels in Manhattan alone are empty, and owners are wondering if they will be able to stay in business.

The Hilton Times Square, a familiar property for business travelers, is one of the most recent casualties. It was announced on Sept. 3 that the hotel would not be reopening and was shuttering for good due to circumstances brought on by COVID-19. More properties may follow.

Meanwhile, New York City Mayor Bill de Blasio has not yet discussed moving homeless out of hotels and back into the shelter system, but it is most likely not going to happen in the near future.

Residents and visitors to cities like New York need to reckon with the fact that some formerly well-run hotels will be running on empty for some time to come. Others, like the Hilton Times Square, will be empty forever.