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
BAS and Security | Oct 19, 2022
The biggest cybersecurity threats in commercial real estate, and how to mitigate them
Coleman Wolf, Senior Security Systems Consultant with global engineering firm ESD, outlines the top-three cybersecurity threats to commercial and institutional building owners and property managers, and offers advice on how to deter and defend against hackers.
Hotel Facilities | Oct 12, 2022
Global hotel chain citizenM opens its first Chicago property and its fifth of the year
citizenM, a global chain of affordable luxury hotels, has opened its first Chicago property—its fifth opening of 2022.
Giants 400 | Sep 9, 2022
Top 90 Hospitality Sector Contractors + CM Firms for 2022
AECOM, Suffolk Construction, STO Building Group, and The Yates Companies top the ranking of the nation's largest hospitality facilities sector contractors and construction management (CM) firms for 2022, as reported in Building Design+Construction's 2022 Giants 400 Report. Note: This ranking includes revenue for all hospitality facilities work, including casinos, hotels, and resorts.
Giants 400 | Sep 9, 2022
Top 70 Hospitality Sector Engineering + EA Firms for 2022
Jacobs, Jensen Hughes, EXP, and Kimley-Horn head the ranking of the nation's largest hospitality facilities sector engineering and engineering/architecture (EA) firms for 2022, as reported in Building Design+Construction's 2022 Giants 400 Report. Note: This ranking includes revenue for all hospitality facilities work, including casinos, hotels, and resorts.
Giants 400 | Sep 9, 2022
Top 120 Hospitality Sector Architecture + AE Firms for 2022
Gensler, WATG, HKS, and JCJ Architecture top the ranking of the nation's largest hospitality facilities sector architecture and architecture/engineering (AE) firms for 2022, as reported in Building Design+Construction's 2022 Giants 400 Report. Note: This ranking includes revenue for all hospitality facilities work, including casinos, hotels, and resorts.
Giants 400 | Sep 9, 2022
Top 80 Hotel Sector Contractors + CM Firms for 2022
AECOM, Suffolk Construction, STO Building Group, and Swinerton top the ranking of the nation's largest hotel and resort sector contractors and construction management (CM) firms for 2022, as reported in Building Design+Construction's 2022 Giants 400 Report.
Giants 400 | Sep 9, 2022
Top 70 Hotel Sector Engineering + EA Firms for 2022
Jensen Hughes, Jacobs, WSP, and Kimley-Horn top the ranking of the nation's largest hotel and resort sector engineering and engineering/architecture (EA) firms for 2022, as reported in Building Design+Construction's 2022 Giants 400 Report.
Giants 400 | Sep 8, 2022
Top 115 Hotel Sector Architecture + AE Firms for 2022
Gensler, WATG, HKS, and Stantec top the ranking of the nation's largest hotel and resort sector architecture and architecture/engineering (AE) firms for 2022, as reported in Building Design+Construction's 2022 Giants 400 Report.
Giants 400 | Aug 22, 2022
Top 90 Construction Management Firms for 2022
CBRE, Alfa Tech, Jacobs, and Hill International head the rankings of the nation's largest construction management (as agent) and program/project management firms for nonresidential and multifamily buildings work, as reported in Building Design+Construction's 2022 Giants 400 Report.
Giants 400 | Aug 22, 2022
Top 200 Contractors for 2022
Turner Construction, STO Building Group, Whiting-Turner, and DPR Construction top the ranking of the nation's largest general contractors, CM at risk firms, and design-builders for nonresidential buildings and multifamily buildings work, as reported in Building Design+Construction's 2022 Giants 400 Report.
