Due to the growth of tourism in New York City, the number of hotels increased rapidly in the last decade. Most of these hotels are located in M1 zones.
In 2018, the New York City Department of City Planning adopted M1 Text Amendment to reduce the proliferation of hotels in the M1 zone. According to the amendment, a special permit is needed for the construction of new hotels, motels, boatels or conversion of transient hotels in the manufacturing districts of New York City. The special permit can be approved after having been reviewed by the Community Board, Borough President, and City Planning Commission. (New York City Planning)
Construction of hotels which started before the adoption of M1 text amendment can be completed and do not need a special permit. If the building permit was issued by the Department of Buildings for the development and conversion of a building into a transient hotel, a special permit is not required as well. But if the construction will not be finished by December 21, 2021, the building permit will expire and the right for construction will terminate. (Kramer Levin, 2019)
There are some M1 zones which are exempt and do not need a special permit. For instance, some areas around the airports like JFK and LaGuardia, mixed use districts, and historic or special purpose districts. (Fontan, 2019)
As a result of the text amendment, the lot area where hotels are permitted as-of-right has been reduced by 45%, and the as-of-right permitted FAR decreased by 25%, according to data published by the City. Construction of a hotel is still possible after getting permission from the City Planning Commission, but getting a special permit is time-consuming and quite expensive, which in the end can be the reason for the desired stability or even decrease in hotels in M1 zones. (Hospitality Trends, 2019)