LE: Latin America’s construction pipeline dips

According to Lodging Econometrics’ (LE’s) Construction Pipeline Trend Report for Q1 2022, the Latin America hotel construction pipeline stands at 563 projects/92,356 rooms, down 7% by projects and 11% by rooms, year-over-year (YOY).

Projects presently under construction stand at 271 projects/49,145 rooms. Projects scheduled to start construction in the next 12 months stand at 148 projects/22,128 rooms and those in the early planning stage are at 144 projects/21,083 rooms. The early planning stage of the pipeline in Latin America is the only stage with growth, up 44% by projects and 30% by rooms YOY. This stage of the Latin American pipeline has continued to grow since its bottom in Q1 ‘21.

Mexico leads Latin America’s construction pipeline with 216 projects/35,620 rooms. Next is Brazil, standing at 90 projects/15,115 rooms. Peru follows with 32 projects/3,972 rooms, then the Dominican Republic with 22 projects/4,853 rooms and Columbia with 18 projects/2,782 rooms. Collectively, these five countries account for 68% of the rooms in the total pipeline.

Cities in Latin America with the largest pipelines include Mexico City, Mexico with 25 projects/3,475 rooms; Guadalajara, Mexico with 21 projects/2,662 rooms; Cancun, Mexico with 20 projects/7,653 rooms; Lima, Peru with 20 projects/2,862 rooms; and Sao Paulo, Brazil with 11 projects/2,101 rooms.

Top hotel franchise companies in Latin America’s construction pipeline are Hilton with 105 projects/15,760 rooms, Marriott International with 103 projects/16,302 rooms, Accor with 80 projects/10,140 rooms and InterContinental Hotels Group (IHG) with 58 projects/6,568 rooms. These four companies are responsible for 61% of the projects in the total construction pipeline.

The top brands in the pipeline are Accor’s Ibis brands with 55 projects/6,876 rooms, Hilton’s Hilton Garden Inn with 26 projects/3,467 rooms and Hampton by Hilton with 24 projects/2,924 rooms. These are followed by IHG’s Holiday Inn Express with 13 projects/1,538 rooms and Hyatt’s AMR Collection with 12 projects/4,517 rooms.

New project announcements in Q1 ‘22 were up 40% by projects YOY at 42 projects/5,054 rooms. In the first quarter of 2022 there were 17 new hotels/2,368 rooms that opened throughout Latin America. LE is forecasting another 88 projects/15,215 rooms to open throughout the remaining quarters of 2022 for a total of 105 new hotels, accounting for 17,583 rooms, by year-end 2022. In 2023, LE analysts are forecasting 108 projects/16,587 rooms to open in the Latin America region.