According to the fourth-quarter U.S. Construction Pipeline Trend Report from Lodging Econometrics (LE), the market with the largest hotel construction pipeline by projects is Dallas with a record high count of 176 projects, accounting for 20,790 rooms.
Following Dallas is Atlanta with 145 projects/18,100 rooms, Los Angeles with 122 projects/19,419 rooms, Phoenix with 116 projects/16,229 rooms and Nashville with 106 projects/14,198 rooms.
U.S. markets with the most projects currently under construction are New York with 61 projects/9,976 rooms and Phoenix with 28 projects/5,522 rooms. Following New York and Phoenix is Atlanta with 27 projects/4,253 rooms, Dallas with 23 projects/3,435 rooms and California’s Inland Empire region with 21 projects/2,120 rooms.
At the Q4 close, Dallas has the most projects scheduled to start in the next 12 months with 68 projects/7,711 rooms, followed by Atlanta with 63 projects/7,520 rooms, Phoenix with 47 projects/5,492 rooms, Nashville with 45 projects/5,199 rooms and then Los Angeles with 42 projects/6,436 rooms.
Dallas also has the largest project count for hotel projects in the early planning stage, standing at 85 projects/9,644 rooms at the Q4 close. Following Dallas is Los Angeles with 61 projects/10,033 rooms, then Atlanta with 55 projects/6,327 rooms, the Inland Empire region with 48 projects/4,993 rooms and Orlando with 45 projects/8,127 rooms.
Throughout 2022, the markets with the greatest number of new openings are New York with 29 projects/4,223 rooms; Austin with 18 projects/2,233 rooms; Nashville with 15 projects/2,354 rooms; Atlanta with 13 projects/1,746 rooms; and Washington, DC with 11 projects/2,012 rooms.
LE analysts forecast the New York market will have the most new hotel openings in 2023 with 46 new hotels /7,795 rooms, for a 6.4% growth rate. In 2024, Atlanta is forecast to open the most new hotels, with 26 projects/3,881 rooms, for a 3.4% growth rate.
The franchise companies with the largest construction pipelines at the end of Q4 are led by Marriott International with 1,490 projects/180,113 rooms. Following Marriott is Hilton with 1,378 projects/154,790 rooms and InterContinental Hotels Group (IHG) with 789 projects/78,951 rooms. Combined, these three companies account for 67% of the projects and 64% of the rooms in the total pipeline.
At the close of the quarter, these top franchise companies also have the greatest number of projects and rooms in each stage of the U.S. construction pipeline. Marriott closed Q4 2022 with the largest project count in the under-construction stage with 266 projects/36,112 rooms, followed by Hilton with 252 projects/31,240 rooms and IHG with 141 projects/15,935 rooms currently under construction.
At the close of the fourth quarter, Marriott also leads with the most projects scheduled to start construction in the next 12 months with a record project count of 825 projects/97,176 rooms, followed by IHG with a project count of 460 projects/44,255 rooms and Hilton with 303 projects/35,695 rooms.
Hilton closed Q4 with record-high project and room counts in the early planning stage, totaling 823 projects/87,855 rooms. Marriott currently has 399 projects/46,825 rooms in early planning and IHG closed the fourth quarter with 188 projects/18,761 rooms in the early planning stage.
The brands of each of these companies with the largest number of projects in the pipeline at Q4 are Hilton’s Home2 Suites with record high project and room counts of 521 projects/53,735 rooms; TownePlace Suites and Marriott’s Residence Inn brands also hit record project and room counts at Q4 with 320 projects/29,802 rooms and 258 projects/31,229 rooms, respectively. IHG’s Holiday Inn Express brand closed the quarter with 293 projects/27,817 rooms in the pipeline. Other prominent brands in the pipeline for these franchise companies are the Hampton by Hilton brands with 280 projects/28,670 rooms; Marriott’s Fairfield Inn with 240 projects/21,887 rooms; and IHG’s Avid Hotel brand with 133 projects/11,195 rooms.
For all of 2022, Marriott opened 131 new hotels/16,643 rooms. Hilton opened 118 new hotels/13,916 rooms and IHG opened 57 new hotels/6,246 rooms.
LE analysts forecast Marriott will open the greatest number of new hotels in 2023 with 156 projects/19,755 rooms for a growth rate of 2.2%. Next is Hilton with 146 projects/17,290 rooms for a growth rate of 2.2%, followed by IHG with 90 projects/10,540 rooms for a growth rate of 2.5%. In 2024, LE forecasts that Marriott will open 193 projects/23,024 rooms. Hilton is expected to open 164 projects/18,639 rooms and IHG is expected to open 124 projects/11,713 rooms.