Hotel Rooms Under Construction Increase Slightly

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The number of hotel rooms in the construction pipeline increased slightly from a year ago, according to Lodging Econometrics, Portsmouth, N.H.

Lodging Econometrics’ third quarter U.S. Hotel Construction Pipeline Trend Report said the total U.S. pipeline of rooms increased 1% year over year while the number of projects in the pipeline held steady, indicating a slight increase in hotel property footprints.

“At the close of the third quarter, there are 1,118 projects/137,620 rooms under construction,” the report said. “Year-over-year, both the starts in the next 12-month stage of the construction pipeline and the early planning stage increased modestly, while the under-construction stage saw a marginal decline.”

LE analysts noted upper-midscale hotel properties have the largest project count in the U.S. pipeline, with 2,279 projects/219,385 rooms. Upscale properties follow with 1,383 projects/172,238 rooms. Together, these two chain scales comprise 59% of all projects in the total pipeline. The midscale segment includes 947 projects with 78,956 rooms, up 2% by both projects and rooms compared to a year ago. “Combined, the top three chain scales by project count—upper-midscale, upscale and midscale–account for 65% of all projects in the total pipeline,” the report said.

The report noted that brand conversion activity reached a record high, closing the quarter with 1,477 projects/148,035 rooms, up 18% by projects and 22% by rooms year over year. Combined, the total renovation and brand conversion pipeline in the U.S. stands at 2,043 projects/271,177 rooms, up 4% by projects and 3% by rooms YOY.

Looking ahead, LE analysts forecast 754 new hotels with 83,118 rooms will open in 2026 for a 1.5% growth rate. The firm forecasts 864 new hotels/91,571 rooms will open in 2027, a 1.6% growth rate.