Dive Brief:

• Aspen Hospitality and New York-based real-estate developer Tishman Speyer will convert 10 floors of vacant office space above the NBC “Today” show studios at Rockefeller Center into a 130-room luxury hotel. 
• The hotel — to open in 2026 as the second installation of Aspen Hospitality’s Little Nell brand — is targeted toward business and leisure travelers. 
• The project comes as property owners across the country reconsider the best use for their office space, with many choosing apartment or hotel redevelopment, CBRE research from December shows.

Dive Insight:

According to CBRE, the pandemic-induced rise of remote work has lowered office demand and occupancy rates, with the national office vacancy rate reaching a nearly 30-year high of 17.1% in the third quarter of 2022. 

Midtown Manhattan — where Rockefeller Center is located — has been particularly hard-hit: According to Avison Young’s Q1 2023 Manhattan Office Market Report, office leasing activity is pacing 35.9% below pre-COVID average leasing activity. 

This shift has amplified a trend toward office conversion across the country, specifically for hotel and multifamily uses. CBRE research shows multifamily is the most common reuse of outdated or underutilized office space, with 89 tracked office-to-multifamily conversions completed since 2016 — reducing office inventory by 16.4 million square feet and adding more than 14,000 apartment units. Hotel conversions come in second place, with 45 completed reuse projects since 2016.  

Aspen Hospitality representatives denied that low office occupancy at Rockefeller Center contributed to the conversion project, saying it has been in the works for years. 

“As a bustling office complex in the return to office era, Rockefeller Center is a natural destination for business and leisure travelers, who will also be served by a new, easily accessible, premium hotel property in the heart of the city,” an Aspen Hospitality spokesperson said.

Rockefeller Center joins a growing list of approximately 14 office-to-hotel projects that are underway or planned across the country, according to CBRE. The list includes the 182,000-square-foot Gwynne Building in Cincinnati. The 1913-built office building is set to undergo an $81 million redevelopment into the 168-room Pendry Cincinnati Hotel by the end of this year.