Mamdani Renews $1.86 Billion Hotel Shelter Contract Through '29

The administration of New York City Mayor Zohran Mamdani has renewed a contract worth up to $1.86 billion that allows hotels across the city's five boroughs to provide emergency shelter for homeless individuals and families through 2029, the New York Post reported on Sunday.

The three-year agreement with the Hotel Association of New York City Foundation, which represents nearly 300 hotels, runs from July 1, 2026, through June 30, 2029. The contract enables the city to use hotel rooms as emergency shelter when needed to meet its legal obligation to house people seeking assistance.

A spokesperson for the city's Department of Homeless Services (DHS) said, "Over the last 15 years, DHS has faced numerous crises that forced it to rely on commercial hotels to temporarily house clients."

The spokesperson added, "DHS is focused not only on upholding New York City's right to shelter but improving outcomes for all the New Yorkers we serve. As such, we continue to work to transform the city's shelter system by opening new, high-quality shelters while gradually phasing out the use of commercial hotels for families with children."

City officials said renewing the contract would ensure sufficient emergency capacity while the shelter system transitions to more permanent facilities. Under New York City's right-to-shelter mandate, the city is legally required to provide shelter to anyone who requests it.

As of July 31, 82,929 adults and children were staying in New York City shelters, according to DHS.

"By exercising the renewal option of the agency's master contract with HANYC, DHS will be able to retain critical hotel capacity, as needed, while we work to bring more traditional capacity online, reduce reliance on hotels, and rightsize our shelter footprint over the coming years," the spokesperson said.

Officials emphasized that the contract authorizes up to $1.86 billion in spending, but said the city may not ultimately spend the full amount because hotels will only be activated as shelters when additional capacity is required.

New York City dramatically expanded its use of hotels during the COVID-19 pandemic to reduce crowding in congregate shelters and later relied on the same strategy during the migrant influx, when thousands of asylum seekers arrived in the city.

At the peak of that crisis, roughly 150 hotels, motels, and inns were converted into temporary shelters.

The Hotel Association of New York City Foundation said it secured the original contract in January 2025 after winning a competitive bidding process.

"It is a continuation of HANYC's well-documented role as a responsible stakeholder since the COVID crisis when the organization moved, pro bono, over 18,000 people from shelters to hotels on an emergency basis from May 2020 to December 2021," said Vijay Dandapani, the organization's chief executive officer.

In addition to the hotel contract, DHS awarded more than $87 million in contracts under its Integrated Commercial Hotels Program to provide on-site services for homeless residents staying in hotels.

Housing Works received a $47.2 million contract, while Neighbors 4 Neighbors was awarded $40.28 million to provide support services and assist homeless individuals and families with daily needs.

The city's continued reliance on hotels has drawn criticism from some who argue that removing thousands of hotel rooms from the commercial market contributes to high lodging costs in one of the nation's most expensive tourism markets.

Homelessness advocates, however, said the practice remains necessary while the city struggles with limited shelter and affordable housing capacity.

Brian Freeman ✉

Brian Freeman, a Newsmax writer based in Israel, has more than three decades writing and editing about culture and politics for newspapers, online and television.

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