In the Q2 2023 Global Construction Pipeline Trend Report from Lodging Econometrics (LE), analysts stated that the total global construction pipeline stood at 14,572 projects/2,310,238 rooms, up 3 percent year-over-year (YOY) by projects and 1 percent YOY by rooms.
Worldwide, at the close of the second quarter, there are 6,154 projects/1,108,498 rooms under construction, 3,679 projects/506,760 rooms scheduled to start within the next 12 months, and 4,739 projects/694,980 rooms in the early planning stage.
Luxury, upper-upscale, and upper-midscale chains dominated the pipeline in Q2, reaching record project counts in Q2 and accounting for 47 percent of the projects in the total pipeline. Of that 47 percent, upper-midscale hotel projects comprised 29 percent of the projects in the total global pipeline with a record 4,236 projects and 558,159 rooms. Upper-upscale projects stood at 1,653 projects/374,407 rooms in Q2, while luxury hotel projects increased 10 percent YOY to close the quarter at 909 projects/180,538 rooms.
Across the globe, the top countries by project count were the United States, with 5,572 projects/660,061 rooms, and China with 3,666 projects/678,965 rooms. The United States accounted for 38 percent of the projects in the global pipeline while China accounts for 25 percent, resulting in 63 percent of the global pipeline being concentrated within these two countries. Following distantly was India with 480 projects/57,161 rooms, the United Kingdom with 322 projects/45,181 rooms, and Saudi Arabia with 276 projects/72,144 rooms.
The markets with the largest pipeline counts worldwide in Q2 were Dallas with 184 projects/21,501 rooms, Atlanta with 141 projects/17,993 rooms, and Chengdu with 140 projects/27,890 rooms; followed by Phoenix with 119 projects/16,107 rooms and Shanghai with 117 projects/22,887 rooms. Of the 11 markets having over 100 projects in their total pipelines, seven are located in the United States, three are in China, and one is in Saudi Arabia.
Three franchise companies topped the global construction pipeline by project count in Q2, accounting for 50 percent of the projects in the total global pipeline. These companies were Hilton Worldwide with 2,808 projects/398,742 rooms, Marriott International with 2,679 projects/429,925 rooms, and IHG Hotels & Resorts with 1,764 projects/259,668 rooms. Accor follows with 930 projects/160,951 rooms and then Hyatt Hotels & Resorts with 417 projects/77,238 rooms.
Upper-midscale brands for the top three companies led the total global pipeline in project counts with Hilton’s Hampton Inn brand stood at 790 projects/102,607 rooms, IHG’s Holiday Inn Express had 599 projects/74,036 rooms, and Marriott’s TownePlace Suites closed the quarter with 364 projects/34,125 rooms. Accor’s top brand in Q2 was its upscale Novotel brand with 137 projects/26,474 rooms and Hyatt’s upscale Hyatt Place brand with 105 projects/16,408 rooms at the close of the quarter.
Throughout the first half of 2023, 868 new hotels accounting for 129,047 rooms opened worldwide, with an additional 1,663 hotels/251,468 rooms scheduled to open by year-end. LE analysts forecast a total of 2,531 new hotels with 380,515 rooms to open in 2023. In 2024, new openings are forecast to reach 2,674 hotels, accounting for 415,699 rooms. For 2025, LE analysts forecast 2,701 new hotels/429,006 rooms to open around the world.
