According to the Q3 2022 Europe Hotel Construction Pipeline Trend Report from Lodging Econometrics (LE), analysts report that at the close of the third quarter, Europe’s hotel construction pipeline stands at 1,660 projects/258,476 rooms. Projects under construction in Europe stand at 790 projects/126,899 rooms, while projects planning to start construction in the next 12 months recorded 408 projects/60,085 rooms. Projects in the early planning stage have 462 projects/71,492 rooms.
Travel activity in Europe has been rebounding over recent months and is expected to continue through the end of the year. Business-related travel is on the rise in the region and hotel bookings at resort destinations and major European cities are comparable to those seen in 2019. Reflective of a strong recovery and the growth in travel and hospitality demand, owners and investors have a positive outlook for the industry moving forward.
Hotel conversions in the region stand at an all-time high of 324 hotels/46,977 rooms, a 51% and 61% year-over-year (YOY) increase respectively, and the highest counts ever recorded by LE. Hotel renovations in Europe are also on the rise with 150 hotels/22,594 rooms at Q3.
Europe’s leading countries with the most projects in the construction pipeline are the U.K. with 298 projects/45,173 rooms; Germany with 250 projects/43,523 rooms; France with 148 projects/16,611 rooms; Portugal with 126 projects/15,185 rooms; and Turkey with record highs of 86 projects/13,532 rooms.
The European cities with the largest pipelines at the Q3 close are London with 79 projects/14,139 rooms; Dusseldorf, Germany, with 44 projects/7,959 rooms; and Istanbul with all-time highs of 40 projects/7,548 rooms, followed by Paris with 34 projects/5,379 rooms and Lisbon with 34 projects/3,923 rooms.
Europe’s top hotel companies in the construction pipeline are Accor with 249 projects/33,941 rooms, Marriott International with 197 projects/30,698 rooms, Hilton with 177 projects/26,634 rooms and Intercontinental Hotels Group (IHG) with 148 projects/20,071 rooms. These four companies account for 46% of projects in the total hotel construction pipeline in Europe. That percentage is expected to rise as some 23% of the projects in the pipeline have yet to select a brand.
The leading brands for these four companies are Accor’s Ibis brands with 88 projects/10,395 rooms, Tribe by Accor with 25 projects/3,815 rooms and Novotel with 22 projects/3,316 rooms. Marriott’s top brands at the close of Q3 are Moxy with 46 projects/7,807 rooms, Autograph Collection with 22 projects/2,952 rooms and Courtyard by Marriott with 19 projects/3,096 rooms. Hilton’s top brands in Europe are led by Hampton by Hilton with 63 projects/9,628 rooms, Hilton Garden Inn with 39 projects/5,992 rooms and Doubletree by Hilton with 23 projects/3,103 rooms. IHG’s top brands include Holiday Inn Express with 58 projects/8,413 rooms, Hotel Indigo with 17 projects/1,782 rooms and Holiday Inn with 16 projects/2,711 rooms.
During the third quarter, Europe opened 94 hotels/13,637 rooms, bringing the total opens in Europe year-to-date in 2022 to 293 new hotels accounting for 43,332 rooms. LE analysts forecast another 98 hotels with 13,041 rooms to open in Q4 for a year-end total of 391 new hotels/56,373 rooms. The LE forecast for new hotel openings expects 408 new hotels to open accounting for 59,684 rooms in 2023 and 419 new hotels /60,246 rooms to open in 2024.