Last week, The New York Times lamented that “the Broadway musical is in trouble.” The piece spells out how the vast majority of new Broadway shows are losing money. A follow-up piece posits that the reason is rising production costs, which have not been accompanied by a rise in ticket prices. Others online speculated that the true reason might be declining show quality. While Hell’s Kitchen: The Musical (yes, really) might not carry the same gravitas as older classics like The Phantom of the Opera, the high costs of staying in the Big Apple may be a significant source of Broadway’s woes. Policymakers should end destructive policies that set the stage for empty theaters.
Catching a Broadway show is often a real treat for out-of-town visitors to New York City (NYC). The 2023 Broadway Demographics Report shows that roughly two out of every three attendees come from outside the NYC metropolitan area. However, NYC has recently made it much harder for visitors to find accommodations in the city during their stay.
Passed in 2022, and implemented a year later, NYC Local Law 18 severely restricts the use of short-term rentals (STRs) within city limits. Though not an outright ban on platforms such as Airbnb, the law has been referred to as a functional ban because of the high barriers it sets up for both renters and platforms. It stipulates that hosts must get special permission with the mayor’s office to offer their property as an STR. A property may not be used as an STR if it is not the owner’s primary residence. Further, the law mandates the property owner to be present during the course of the rental and limits such rentals to no more than two people per room.
It is not hard to see why such a bill is being described as a backdoor ban.
In the wake of Local Law 18, hotel prices in NYC have risen to record highs. In March of 2025, the average nightly cost for a room in an NYC hotel reached a staggering $320. For perspective, the average across the whole of the U.S. during the same time was roughly $159. Over the past year, hotel rates in NYC have risen by 5.4 percent, whereas rates across the country have only risen 1.8 percent over the same timeframe. Would-be NYC visitors have fewer options, and legal options are getting more and more expensive.
The law is not only affecting Broadway shows, but localities as well. In 2024, local chambers of commerce from all five boroughs raised the alarm in an open letter to the City Council. They noted that some neighborhoods are seeing as much as a 70 percent drop in foot traffic. This is impacting local businesses in a major way. In particular, Crown Heights in Brooklyn, Astoria in Queens, and the South Bronx have seen a marked reduction in tourism dollars.
The law is also hurting some of NYC’s local communities. The New York Urban League claims the restriction on STRs particularly hurts the city’s Black and Latino populations, who often use the income from sharing their homes to build generational wealth within their neighborhoods. The Latino Restaurant, Bar, and Lounge Association notes, “Short-term rental guests often bring our restaurants to life—and their absence is being felt nightly.”
New York’s local restaurant scene—including the best pizza and pasta in the country—is part of what makes it an attractive destination for travelers. The ability to catch a Broadway show and then dine out at one of the best restaurants in the country is a unique experience that many around the country—and the world—only dream about. NYC’s restrictions on STRs are threatening to upend the ecosystem that makes it one of the greatest cities in the world.
As big cities like NYC seek to hit their stride once again in the wake of the coronavirus pandemic, it will need all the help it can get to revitalize a once-booming tourism industry. STR hosts and platforms ought to be a big part of supporting NYC’s theaters, restaurants, and local businesses. Unfortunately, local leaders have prioritized the interests of the hotel industry over virtually everyone else in their city.
People can muse over what’s gone wrong with the Broadway musical. Yes, the shows might not be as instantly recognizable or as original as they used to be. Sure, there may be an over-emphasis on eye-popping, expensive sets, which make the shows more costly. However, these questions remain moot if people can’t afford to stay in the city in the first place. City leaders ought to close the curtain on Local Law 18 to put a stop to the trend.
Dan Savickas is the vice president of policy and government affairs for the Taxpayers Protection Alliance.
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