August 23, 2015
Fears that the strengthening U.S. dollar would reverse the steady increase in tourism to New York City have not been realized. In fact, international visits jumped 7% in 2014 from the prior year, while domestic tourism grew 3%. An all-time high of 56.4 million tourists visited the Big Apple, a 23% increase since a one-year blip in 2009 caused by the recession. Another 3% gain is expected this year.
Currency fluctuations are worth watching, though, as they affect tourists’ destinations and expenditures when they reach them. Tourist spending here would likely have grown even more had the U.S. dollar not gotten more expensive for Brazilians, Europeans and Canadians
The good news for New York is that U.S. dollars became only marginally more costly for the British, who are the most frequent foreign visitors to the city, and for the big-spending Chinese, who are fourth in visitorship but gaining.
To accommodate the waves of travelers, the city’s hotel industry has grown—room inventory is up 40% since 2006—as has the number of residences marketed to tourists on Airbnb and other home-sharing sites. Despite the additional lodging, hotels’ room prices have climbed by 13% and their occupancy rates by 4% since 2010.
With room prices high and vacancies low, hotel developers will maintain their furious pace.
Subways, shopping are big draws
What makes New York City such a tourist magnet? It’s not just the sights and cultural offerings. Visitors find it easy to get around, and they love to shop.
“Transportation is much cheaper here than in Brazil,” said Hortencia Barcelos, who was visiting for the first time and had purchased a seven-day unlimited MetroCard. “We have a transit system in Brazil, but no one rides it because it’s not safe, so you have to own a car. It also doesn’t run as smoothly.”
Two other Brazilians, Denise Aoyama and Ricardo Souza, both 33, bought pay-per-ride MetroCards but said they were mostly using Uber to get around during their eight-day stay. New York is also famously walkable.
Ms. Barcelos plowed her transportation savings into cultural activities and shopping, including a trip to an Apple store. “My friend and I spent $1,000 our first day here,” she said.
Shopping is the main draw for many tourists, who load up on goods that in their home countries cost more or are unavailable. The most frequent New York stop for Chinese travelers in 2014 was not the Statue of Liberty or Central Park, but Woodbury Commons, according to Brian Buchwald, CEO of Bomoda, a consumer intelligence company. Luxury brands such as Coach, Michael Kors and Tiffany & Co. are favorites, as are department stores Macy’s and Bloomingdale’s.
The number of Chinese visitors has increased 250% since 2010 and is expected to grow another 15% this year, to 932,000.
“Only 6% of Chinese citizens have passports,” said Mr. Buchwald. “That number will only grow going forward and will further impact our economy.”