Analysts at Lodging Econometrics (LE) report that at the close of the second quarter of 2020, the total U.S. hotel construction pipeline stands at 5,582 projects/687,801 rooms, down a mere 1% by projects and rooms, Year-Over-Year (YOY). Remarkably, despite some project cancelations, postponements, and delays, there has been minimal impact on the U.S. construction pipeline. Contrary to what is being experienced with hotel operations, the pipeline remains robust as interest rates are at all-time lows.
Projects currently under construction stand at 1,771 projects/235,467 rooms, up 3% and 1% respectively, YOY. Projects scheduled to start construction in the next 12 months total 2,389 projects/276,247 rooms. Projects in the early planning stage stand at 1,422 projects/176,087 rooms. As expected, developers with projects under construction are still experiencing some opening delays. However, projects continue to move forward, albeit with extended timelines. As was the case at the end of the first quarter, developers with projects scheduled to start construction in the next 12 months continue to monitor current events and make adjustments to their construction start and opening dates.
In the first half of 2020, the U.S. opened 313 new hotels with 36,992 rooms. Additionally, there were 481 new projects with 56,823 rooms announced into the pipeline in the first half of 2020. Of those totals, 169 new project announcements with 20,359 rooms occurred in the second quarter. With franchise development staff largely working from home, non-essential travel halted, and with the on-going pandemic, the ability to get a new development deal signed has slowed. This has resulted in a 53% decrease in new project announcements compared to the second quarter of 2019 when 359 projects/44,895 rooms were recorded.
With the arrival of summer, the country has begun to see an uptick in domestic leisure travel. As a result, more and more hotels are re-opening, and many others have begun to move-up renovation plans and/or are repositioning their property with a brand conversion. In the first half of 2020, LE recorded 1,465 active renovation projects/314,043 rooms and 1,196 active conversion projects/136,110 rooms throughout the United States.
Related Stories
Market Data | Oct 6, 2020
Construction sector adds 26,000 workers in September but nonresidential jobs stall
Many commercial firms experience project cancellations.
Market Data | Oct 6, 2020
6 must reads for the AEC industry today: October 6, 2020
Construction rises 1.4% in August while nonresidential construction spending falls slightly.
Market Data | Oct 5, 2020
Nonresidential construction spending falls slightly in August
Of the 16 nonresidential subcategories, nine were down on a monthly basis.
Market Data | Oct 5, 2020
Construction spending rises 1.4% in August as residential boom outweighs private nonresidential decline and flat public categories
Construction officials caution that demand for non-residential construction will continue to stagnate without new federal coronavirus recovery measures, including infrastructure and liability reform.
Market Data | Oct 5, 2020
7 must reads for the AEC industry today: October 5, 2020
Zaha Hadid unveils 2 Murray Road and the AEC industry is weathering COVID-19 better than most.
Market Data | Oct 2, 2020
AEC industry is weathering COVID-19 better than most
Nearly one-third of firms have had layoffs, more than 90% have experienced project delays.
Market Data | Oct 2, 2020
6 must reads for the AEC industry today: October 2, 2020
BIG imagines how to live on the moon and smart buildings stand on good data.
Market Data | Oct 1, 2020
Two-thirds of metros shed construction jobs from August 2019 to August 2020
Houston-The Woodlands-Sugar Land and Brockton-Bridgewater-Easton, Mass. have worst 12-month losses, while Indianapolis-Carmel-Anderson, Ind. and Niles-Benton Harbor, Mich. top job gainers.
Market Data | Oct 1, 2020
6 must reads for the AEC industry today: October 1, 2020
David Adjaye to receive 2021 Royal Gold Medal for Architecture and SOM reimagines the former Cook County Hospital.
Market Data | Sep 30, 2020
6 must reads for the AEC industry today: September 30, 2020
Heatherwick Studio designs The Cove for San Francisco and Washington, D.C.'s first modular apartment building.