Five U.S. Markets With the Most Hotel Construction

Analysts at Lodging Econometrics (LE) recently reported the top five U.S. markets with the largest hotel construction pipelines in the first quarter of 2019. LE analysts expect that their forecast for new hotel openings will continue to rise through 2020.

The number of markets where supply growth is now exceeding demand growth continues to increase. At the first quarter, 18 of the top 25 markets experienced the shift, up from 12 of the top 25 markets at the end of the fourth quarter of 2018. Markets of concern where new supply is already outpacing demand and future new openings are forecasted to be high are Houston, New York, Dallas, and Los Angeles.

1New York City

New York has the biggest hotel construction pipeline in the country with 170 projects totaling 29,247 rooms. The city also has the greatest number of projects already under construction—119 hotels totaling 20,068 rooms. In 2019, 63 new hotels are expected to open in the Big Apple, adding 9,605 rooms to the market. In the 2020 forecast, New York continues to lead with the highest number of new hotels anticipated to open with 44 projects/6,225 rooms.

2Dallas

Dallas’ hotel construction pipeline is at a record high of 163 projects totaling 19,689 rooms. The Texas city also has the second highest number of hotels that are already under construction—48 projects/6,265 rooms. This year, 30 new hotels are expected to open in Dallas, adding 3,604 rooms to the market. Dallas is expected to have the third highest number of new hotel openings in 2020 behind New York and Los Angeles, with 33 projects/4,163 rooms anticipated to open next year.

3Los Angeles

The hotel construction pipeline in Los Angeles is also at a record high, with 158 projects and a total of 25,578 rooms. The city has the third largest number of hotels already under construction, with 42 projects totaling 6,288 rooms. In the 2020 forecast, Los Angeles will surpass Dallas for new hotel openings, with 35 projects/5,140 rooms expected to come online.

4Houston

Houston has the fourth largest hotel pipeline in the United States, with 151 projects totaling 15,643 rooms. Within that pipeline, 36 hotels totaling 4,162 rooms are already under construction. The city will have the third highest number of new hotel openings in the United State this year—28 new hotels totaling 3,342 rooms.

5Nashville

Nashville now has the fifth largest hotel construction pipeline in the country, with a total of 116 projects totaling 15,599 rooms. The Music City has 34 projects currently under construction—the same number as Austin and San Jose. Nashville falls just behind Austin when it comes to new hotel openings in 2019—the Austin market is expected to add 25 hotels/2,512 rooms this year, and Nashville will add 23 hotels/3,030 rooms.

 


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