REal Talk with Adam Perrotta - Thursday

In the wake of the news that the Port Authority of New York and New Jersey is looking to reduce the scale of the planned World Trade Center redevelopment in Lower Manhattan, it now looks as though the agency is interested in replacing at least some of that office space with a hotel. This is somewhat interesting, as one of the Port Authority's major reasons for its proposal to cut back the amount office space at the project was the fact that the demand-supply ratio in the office sector has been thrown for a loop by the current economic turmoil--an imbalance that could have a ripple effect in the market for some time.

But the Lower Manhattan hospitality sector is also experiencing its own supply-demand gap. While not nearly as densely-populated with hotels as the Midtown submarket, Downtown has over the last few years seen a spike in new hotel development, and there are currently several projects planned for the area. Should the city still be feeling lingering effects of the current dip in tourism and business travel when the prospective hotel opens, the property could have its hands full fighting for occupancies with the other area competition. All of this, of course, is not to say that a hotel couldn't work as part of the WTC plan. Manhattan remains, after all, one of the most popular travel destinations in the world--and that isn't likely to change anytime soon.

What are you feelings on the Port Authority's idea to develop a hotel at the WTC site? Is making the redevelopment a mixed-use project a good idea? Or should it remain office-only?