New York City hotels are now cheaper. Here's why

Usually a strong dollar benefits Americans traveling abroad most directly, but a surging greenback is also bringing down hotel room rates in one of the priciest U.S. markets.

As the dollar firms up against other currencies, international tourists are thinking twice about taking a trip to New York City, said Patrick Scholes, gaming and lodging equity managing director at SunTrust Robinson Humphrey. Bookers can now find decent hotel rooms in Times Square for less than $90 a night through mid-February, he told CNBC's "Squawk on the Street" on Tuesday.

"What's going on is foreign exchange is hurting international tourism. New York is the biggest international tourist market in the United States. Almost half the guests are international. It hurts," he said.

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The pound fell to an 18-month low against the dollar on Tuesday. The euro briefly dropped below 1.18 to the dollar.

Revenue per available room, a key metric in the hotel industry, is tracking for a 5 percent year-over-year fall in New York for the first quarter of 2015, compared with a 7 percent increase for the rest of the country, Scholes said.

SunTrust projects the picture will only improve slightly, with revPAR for New York hotels down 2 percent in the second quarter. The outlook is based on proprietary booking data that analyzes millions of future hotel reservations.

"I suspect going forward, that may even soften as the dollar is certainly strengthening," he said.

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Scholes conceded that New York has also seen a 5 to 6 percent compounded new supply of hotel rooms during the last several years, which could also contribute to lower prices. He said 2015 should see similar growth levels.

However, it was sustained international demand that helped to soak up much of that new supply, he said. Now, one problem is compounding the other.