The total U.S. construction pipeline stood at 4,967 projects with 622,218 rooms at the end of the first quarter of this year, according to Lodging Econometrics’ (LE’s) Construction Pipeline Trend Report for the United States. While this is a slight dip in the pipeline year over year, it’s not unexpected given the lockdown and travel restrictions over the past year. Further, the pipeline shows no signs of great decline compared to what occurred during the 2008-2009 recession.
Although hotel development may still be tepid in the first quarter, continued government support and the extension of programs has aided many businesses to get back on their feet as more and more are working to re-staff and reopen.
At the end of the first quarter, projects under construction stood at 1,311 projects with 179,304 rooms. Projects under construction continue to move toward opening. Through year-end 2020, the U.S. opened 841 projects accounting for 97,959 rooms. A total of 229 hotels with 27,528 rooms opened in the first quarter of 2021. As delayed fourth-quarter 2020 opens are coming online, LE is forecasting 691 projects with 81,866 rooms to open by the end of 2021, representing a 2 percent increase in new hotel supply. For all of 2022, LE is forecasting 963 projects with 111,235 rooms to open and a 2 percent supply increase.
Projects scheduled to start construction in the next 12 months total 1,866 projects with 215,911 rooms. Of the 1,866 projects scheduled to begin in the next 12 months, 26.8 percent of these belong to extended-stay brands, a segment of the industry that developers have become increasingly interested in over the last few years. Projects in the early planning stage stand at 1,790 projects with 227,003 rooms, up 10 percent by projects and 14 percent by rooms YOY.
Additionally, there were a total of 1,198 projects with 190,475 rooms under renovation or conversion in the U.S. during the first quarter. This is a small decline after seeing a slight increase at the end of 2020.
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