Lodging Econometrics recently released the findings of its second-quarter hotel construction pipeline trend report, including the top five markets with the largest hotel construction pipelines as well as the U.S. markets with the most hotel projects currently under construction and forecast to open in the near future.
1. New York City
With 169 projects totaling 29,365 rooms, New York City had the largest hotel construction pipeline in Q2 2018. The Big Apple also had the most projects currently under construction—101 projects totaling 17,108 rooms. In the second quarter, 11 projects and 1,075 rooms were added to the city’s pipeline. If all of the projects in its pipeline come to fruition, New York City will increase its current room supply by 25.2 percent. The country’s largest market also has the most hotels forecast to open in 2018—45 projects/7,762 rooms. In 2019, New York is forecast to again top the list of new hotel openings with 52 projects/7,356 rooms.
Dallas had the second largest hotel construction pipeline in the United States in the second quarter, with 156 projects totaling 18,908 rooms. In addition, the city had the second highest number of projects currently under construction after New York City—47 projects and 6,350 rooms. When it comes to the number of new projects announced during the second quarter, Dallas came in fifth among U.S. markets, with 10 projects amounting to 1,229 rooms announced. Following New York City, Dallas had the second highest number of hotels forecast to open in 2018—33 properties with a combined 3,813 rooms. The city is anticipated to take the lead in 2020 with 40 projects/4,943 rooms expected to open.
Texas’ second market on the list had a hotel construction pipeline of 150 projects and 16,321 rooms in the second quarter, making it the third largest pipeline in the United States. Houston has the fourth largest number of projects currently under construction—40 hotels with a combined 4,738 rooms. In Q2, 11 projects totaling 909 rooms joined Houston’s pipeline. The city is expected to have the third highest number of hotel openings in 2018 behind New York City and Dallas—27 hotel openings totaling 3,114 rooms.
Nashville came in fourth among the country’s largest hotel construction pipelines with 123 projects and 16,392 rooms. The city had the third highest number of projects currently under construction—43 projects totaling 7,005 rooms. In the second quarter, Nashville had 13 projects totaling 1,351 rooms announced into the pipeline, the most of any U.S. market. If all of the projects in the city’s pipeline come to fruition, Nashville will increase its current room supply by 38.2 percent.
5. Los Angeles
With 121 hotel projects and 18,037 rooms in its pipeline, Los Angeles made the list for the top five largest hotel construction pipelines in the country. The city followed Nashville with the most hotel projects added to its pipeline during the second quarter—12 projects totaling 1,845 rooms.
Other leading markets in the second quarter included Atlanta, which had the fifth highest number of projects currently under construction (28 hotels, 3,387 rooms). If all of the projects in their pipelines come to fruition, these markets will increase their current room supply significantly: Austin by 29.3 percent; Fort Worth by 28.5 percent, and San Jose by 25.3 percent.