BY ROB SCHNEIDER | JANUARY 2, 2024
The latest data from Lodging Econometrics also shows that renovation and conversion activity has hit record highs.
The hotel construction pipeline in the United States continues to see steady growth, according to the latest data from Lodging Econometrics, and that trend is expected to continue. In addition, activity for renovation/conversion deals has hit the highest totals ever recorded by the company.
At the end of the third quarter, the U.S. had 59,569 operating hotels, accounting for 5,647,346 rooms. Through the first three quarters of 2023, 345 hotels opened, totaling 41,114 rooms. LE expected another 182 hotels and 24,790 rooms to open by the end of 2023. That would bring the total to 59,751 hotels and 5,672,136 rooms, reflecting a supply increase of 1.2% year-over-year.
That supply is expected to increase slightly year-over-year in 2024, with LE forecasting 664 hotels and 79,286 rooms over the next year, representing a 1.4% supply increase YOY.
Construction pipeline
The LE data shows that through Q3, there were 1,063 projects and 140,331 rooms under construction. Those numbers reflect an 8% increase for projects and a 4% for rooms YOY.
That construction trend is expected to steadily increase in 2024, with 2,234 projects and 257,729 rooms scheduled to start construction in the next 12 months. That would reflect an 8% increase for projects and a 9% increase for rooms YOY.
The 2,407 projects and 274,616 rooms in the early planning stages sit just shy of an all-time high, and each increased 7% YOY. Those totals are just 27 projects and 5,296 rooms shy of a record.
Activity for renovations and conversions has hit the highest totals ever recorded by LE, with 1,100 projects and 146,757 rooms at the end of 3Q23. The renovation and conversion active pipeline sits at 1,912 projects and 258,568 rooms, a peak number for the latter. LE analysts expect those positive trends to continue over the next two years.
Original article from Hotel Investment Today can be found here: https://www.hotelinvestmenttoday.com/Development/Owners/2024-US-forecast-8-percent-increase-in-project-construction