Vol. 5, No. 7, July 2008
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Luxury Room Boom
As F. Scott Fitzgerald famously observed, “The rich are different from you and me.” His assertion has special significance here in Atlantic City, where developers are building plush new lodgings and upscale hotels, despite an economy that has many Americans switching from two-ply to one-ply toilet paper.
A new survey by Market Metrix, a California-based researcher for the hospitality industry, says luxury hotels seem to be recession-proof, with guests willing to paying several hundred dollars per night to snooze in swanky surroundings.
According to the survey, the average rate for a luxury room in 2007 was $293, and the wealthy (as well as international travelers whose currency is strong compared to the U.S. dollar) have no trouble paying it.
Another reason, says study co-author Jonathan Barsky, is that luxury hotels are not plentiful, and some people just love to be pampered.
“Only in the last 10 years has there been a demand for super-luxury properties,” Barsky says. “When you have a high demand outstripping the supply, it means the market will have a higher price for fewer rooms.”
That news bodes well for the future of Atlantic City’s new $400 million Water Club (above), where guests will pay $609 per night for rooms on a holiday weekend, and the upcoming Chelsea, where a penthouse suite will cost $935 per night.
