In the most recent Construction Pipeline Trend Report for the United States (U.S.) from Lodging Econometrics (LE), at the close of 2022’s fourth quarter, the U.S. construction pipeline stands at 5,465 projects/650,626 rooms, up 14% by projects and 12% rooms Year-Over-Year (YOY).
In Q4, all stages of hotel construction in the U.S. experienced positive YOY growth. At the close of the quarter, there are 1,008 projects/135,492 rooms under construction, up 4% by projects and 3% rooms YOY. Projects scheduled to start construction in the next 12 months stand at 2,073 projects/235,222 rooms, up 14% by projects and 12% by rooms YOY. Projects and rooms in the early planning stage increased 18% and 17% YOY, respectively, reaching all-time high counts of 2,348 projects/279,912 rooms.
The 2023 outlook for the lodging industry looks strong, as it continues to recover from the lows experienced throughout the past two years. Although the U.S. and the hotel industry continue to face some economic challenges, travel and hotel bookings increased substantially during 2022 and the new construction pipeline in the U.S. continues to grow at a moderate pace with new project announcements and construction-starts increasing 35% YOY and 36% YOY, respectively. Hotel owners, investors, developers, and management groups see much opportunity in the year ahead.
At the end of the fourth quarter, brand conversion room counts reached record highs of 1,030 projects/102,162 rooms. The renovation pipeline also remained strong in Q4, reaching the highest project counts seen since Q1 2019, standing at 900 projects/148,105 rooms. Combined, renovation and conversion activity accounts for 1,930 projects/250,267 rooms, record-highs by projects and up 53% YOY by projects and 45% by rooms YOY.
Dallas, Atlanta lead the nation in hotel construction projects
The U.S. Markets with the greatest number of projects in the construction pipeline, at the end of the fourth quarter, are Dallas with 176 projects/20,790 rooms. Following are Atlanta with 145 projects/18,100 rooms, Los Angeles with 122 projects/19,419 rooms, Phoenix with 116 projects/16,229 rooms, and Nashville with 106 projects and 14,198 rooms.
Franchise companies topping the pipeline with the greatest project and rooms counts at Q4 are Marriott International with 1,490 projects/180,113 rooms, Hilton Worldwide with 1,378 projects/154,790 rooms, and InterContinental Hotels Group (IHG) with 789 projects/78,951 rooms.
The brands with the largest number of projects in the pipeline at Q4 close are Home2 Suites by Hilton, with 521 projects/53,735 rooms; Marriott’s TownePlace Suites with 320 projects/29,802 rooms; and InterContinental Hotels Group’s (IHG) Holiday Inn Express with 293 projects/27,817 rooms.
Throughout 2022, the U.S. opened 464 new hotels, accounting for 54,620 rooms, for a growth rate of 1.0%. LE analysts expect new hotel openings to increase in 2023 with 607 projects/72,665 rooms forecasted to open, representing a 1.3% supply increase; and in 2024, 722 projects/82,813 rooms are expected to open, for a 1.5% supply increase.
Related Stories
Modular Building | Feb 16, 2020
On the West Coast, prefab gains ground for speedier construction
Gensler has been working with component supplier Clark Pacific on several projects.
Hotel Facilities | Feb 12, 2020
HGA-designed hotel becomes one of the tallest buildings in Rochester, Minn.
The project is part of the city’s Destination Medical Center initiative.
Hotel Facilities | Jan 28, 2020
Atari to build eight video game-themed hotels
The first location will break ground in Phoenix later this year.
Hotel Facilities | Dec 5, 2019
Disney’s Galactic Starcruiser hotel will open in 2021
The immersive hotel will be the company’s newest Star Wars experience.
Sustainability | Nov 13, 2019
Citicape House will feature Europe’s largest living wall
Sheppard Robson designed the project.
Hotel Facilities | Nov 13, 2019
A guitar-shaped hotel is South Florida’s latest beacon
The Seminole Hard Rock Hotel & Casino in Hollywood is illuminated by 2.3 million lights and lasers.
Hotel Facilities | Nov 7, 2019
New London aparthotel is made entirely from shipping containers
Doone Silver Kerr designed the project.
Resort Design | Oct 24, 2019
Ponce Paradise wants to become Puerto Rico’s premiere destination
LandDesign and Winstanley Architects & Planners are designing the project.
Hotel Facilities | Oct 22, 2019
Modular, collapsable hotel pods can be built in cities’ interstitial spaces
Connectic by Cooper Carry recently won the 2019 Radical Innovation Award.
Hotel Facilities | Sep 24, 2019
A series of glass ‘igloos’ create the world’s northernmost hotel
Luxury Action, a private travel company, is behind the project.
