Lodging Econometrics’ Select Market Projections for 2022 and 2023

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In advance of the NYU Hospitality Industry Investment Conference, Lodging Econometrics (LE) analyzed several selected markets in the U.S. and their projected hotel openings over the next two years. As we have seen in late ’21 and so far in ’22, previously on-hold new hotel projects are moving forward to fruition. As a result, we expect to see an increase in new hotel openings over the next couple of years.

At the end of Q1 ‘22, the New York market is projected to open an astounding 77 projects/10,934 rooms in 2022. If all these rooms open, the New York market is expected to experience a 9% supply growth rate. Austin follows distantly in forecasted openings for 2022 with 26 projects/3,387 rooms, which equates to a 7.4% supply growth rate. By projects, Atlanta is next with 20 projects/2,165 rooms for a growth rate of 1.9%, then Los Angeles with 19 projects/3,330 rooms and a growth rate of 3.1%. Both Miami and Nashville have 17 projected hotel openings for 2022, for similar growth rates of 5% and 4.7%, respectively. Dallas, which leads the hotel construction pipeline with 165 projects/19,730 rooms, is forecasted to open 16 projects and 1,656 rooms in 2022 for a growth rate of 1.6%. Twenty-two percent of the projects in Chicago’s construction pipeline are expected to open in 2022, for a total of 14 projects/1,747 rooms. In 2022, Washington, DC is anticipated to have its highest room count opening and growth rate of the past three years by opening 11 projects/1,939 rooms for a growth rate of 1.7%. San Francisco and Boston are both forecasted to open 7 projects/1,003 rooms and 6 projects/835 rooms, respectively in 2022. This will translate to a 1.8% and 1.3% growth rate, respectively.

At the end of Q1 2022, LE is anticipating fewer hotel projects to open in the markets mentioned above in 2023 than in 2022. In 2022, for the eleven markets above, LE is forecasting a total of 230 projects/32,599 rooms to open, while in 2023, LE is projecting 149 projects/19,304 rooms to open in these same markets.

LE saw hotel projects, in many of these markets, delayed over the last two years. However, now as travel and demand begins to increase, developers in these markets are feverishly pushing their under-construction projects forward to open. Likewise, in many of these markets, projects in the early-planning and scheduled-to-start-in-the-next-12-months stages of the pipeline remain high, as developers have been waiting for the right time to begin their projects. Since most projects have about a 2-year build cycle, forecasted openings will temper slightly at the beginning of 2023, but are expected to become robust again in 2024 as these projects move into the under-construction stage, and then open. Overall, however, the U.S. in 2023 is expected to have more openings than in 2022.

LE’s forecast for new hotel openings is always being updated as construction timelines and opening dates are adjusted by developers. In Q2 ‘22, LE will publish its 2024 Forecast for New Hotel Openings and provide any updates to its 2023 forecast. To purchase information on LE’s hotel construction pipeline or for projections on new hotel openings in any market in the United States with supply growth rates please contact Lodging Econometrics at +1 603-431-8740 Ext. 0025 or visit: https://lodgingeconometrics.com/purchase-reports/to purchase our latest Construction Pipeline Trend Reports or Market Trend Reports.