The hotel sector is booming. But for how long?
Last April, the Real Deal, which tracks real estate news and trends, reported that new hotel construction in New York, which peaked in 2014, “is finally crashing” because so many new properties were coming online and developers were shying away from planning new projects.
In the first three months of this year, hoteliers had submitted permit applications for only six new hospitality properties, a total of 512 units, citywide. The Real Deal estimates that barely 10,000 new hotel rooms would be added to New York’s inventory this year, compared to more than 9,000 in 2014.
On Tuesday, Lodging Econometrics, the Portsmouth, N.H.-based market research firm, reported that New York City has the country’s largest hotel construction pipeline by project count: 196 projects and 32,121. New York has had the largest project count since the fourth quarter of 2011.
New York is followed by Houston (170 projects, 20,083 rooms), which has been the second-largest hotel market for the past 10 quarters, according to Lodging Econometrics. The rest of the top five hotel construction metros are Dallas (128 projects/15,662 rooms), Nashville (109/13,789), and Los Angeles (104/17,912).
A day before Lodging Econometrics released this data, STR, a global data benchmarking and analytics firm, released its July 2016 Pipeline Report, which showed 171,276 rooms in 1,305 projects under construction, a 32.6% increase over the same month a year ago.
STR estimates that New York, with an existing supply of 112,468 rooms, had 15,770 rooms under construction, 11.9% more than in July 2015. Three other markets—L.A./Long Beach, Dallas, and Houston—had more than 5,000 rooms under construction.
Conversely, Bobby Bowers, STR’s Senior Vice President of Operations, notes that the San Francisco/San Mateo, Calif., market may be reaching a saturation point, with room construction among the five-lowest in the country.
New York City continues to lead the nation in new hotel construction and rooms under contract. The nation's 26 largest cities are, for the most part, seeing strong growth in their hospitality sectors, even as some developers worry that too much inventory may be coming online. Chart: STR
Related Stories
| Mar 15, 2013
7 most endangered buildings in Chicago
The Chicago Preservation Society released its annual list of the buildings at high risk for demolition.
| Mar 14, 2013
25 cities with the most Energy Star certified buildings
Los Angeles, Washington, D.C., and Chicago top EPA's list of the U.S. cities with the greatest number of Energy Star certified buildings in 2012.
| Mar 7, 2013
Vegas rebound: Genting Group acquires assets of stalled Vegas casino-resort
International hospitality giant Genting Group has announced a deal with Boyd Gaming Corp. to purchase the land and assets, including partially built structures, of the stalled Echelon casino-resort in Las Vegas.
| Mar 6, 2013
Hospital project pioneers BIM/VDC-based integrated project delivery
The Marlborough (Mass.) Hospital Cancer Pavilion is one of the first healthcare projects to use BIM/VDC-based integrated project delivery.
| Mar 4, 2013
Gehry unveils design for Santa Monica hotel-condo tower
If all goes as planned, Frank Gehry will design the first building in his hometown in some 25 years.
| Mar 3, 2013
Hines acquires Archstone's interest in $700 million CityCenterDC project
The Washington D.C. office of Hines, the international real estate firm, announced the acquisition of the ownership interest of their partner, Archstone, in the mixed-use CityCenterDC project that is currently under construction in downtown Washington, D.C.
| Feb 25, 2013
10 U.S. cities with the best urban forests
Charlotte, Denver, and Milwaukee are among 10 U.S. cities ranked recently by the conservation organization American Forests for having quality urban forest programs.
| Feb 18, 2013
Top 10 kitchen and bath design trends for 2013
Gray color schemes and transitional styles are among the top trends identified by more than 300 kitchen and bath design experts surveyed by the National Kitchen & Bath Association (NKBA).
| Feb 6, 2013
George W. Bush Presidential Center among award-winning roofing projects honored by Sika Sarnafil
Winners of the 2012 Contractor Project of the Year Competition were announced this week by Sika Sarnafil. The annual competition highlights excellence in roofing installation. Roofing contractors are judged based on project complexity, design uniqueness, craftsmanship, and creative problem solving.
| Feb 5, 2013
5 forces driving hotel investment
Jones Lang LaSalle’s Hotels & Hospitality Group believes that signs point to an on-going uptick in Americas hotel transactions activity sooner rather than later. They identify the five forces that will drive the hotel investment market during the next five years.
