NYC Mayor Zohran Mamdani Renews $1.86 Billion Contract for Hotels to Double as Homeless Shelters

New York City Mayor Zohran Mamdani will continue to utilize hotels to house the homeless population in the Big Apple.

On Sunday, August 2, the New York Post reported that Mamdani, 34, has extended the $1.86 billion contract with the Hotel Association of New York City Foundation — which represents almost 300 hotels — to provide emergency housing in the five boroughs. The contract has already started and will run for three years from July 1, 2026, to June 30, 2029

“Over the last 15 years, [the Department of Homeless Services] has faced numerous crises that forced it to rely on commercial hotels to temporarily house clients,” a DHS spokesperson said in a statement per the outlet. “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,” the spokesperson continued. “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 contract was finalized in January 2025, HANYC told the publication. That deal was negotiated by former Mayor Eric Adams, per the Post.

CEO of HANYC Vijay Dandapani shared a statement explaining, “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.”

The DHS representative noted that the city may not need to spend the full $1.86 billion allotment, and the hotels will be used as shelters on a need-based basis. As of July 31, there were 82,929 adults and children in the shelters, the department told the outlet.