U.S. hotel construction down 48,000 rooms - Insights
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U.S. hotel construction down 48,000 rooms

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Hotel construction pipelineThe number of U.S. hotel rooms in construction is down roughly 48,000 from the country’s all-time high in April 2020 (220,207 rooms), according to September 2021 pipeline data from STR.

The final two phases of the pipeline, construction, and final planning, are down by double digits from the same time last year while activity in the planning stage has risen significantly.

September 2021 (percentage change in comparison with September 2020):

  • In construction: 172,251 rooms (-20.3%)
  • Final Planning: 205,829 rooms (-17.2%)
  • Planning: 263,673 rooms (+41.1%)

“The impacts of the pandemic and the associated financial bearings have reached the hotel development pipeline, as the number of rooms in the construction phase continues to decline,” said Alison Hoyt, STR’s senior director of consulting. “While part of the decrease has come from fewer rooms entering and moving through the pipeline, new openings that were delayed by the pandemic also account for some of the loss. For 2021 as a whole, we’re looking at a higher-than-average influx of new rooms, assuming properties with projected opening dates over the final months of the year open on time. It is more likely that at least some of the projects nearing completion will be delayed to 2022 openings.”

As of 1 October 2021, New York City showed almost 18,000 rooms in construction. Only five other markets have more than 5,000 rooms in that final phase of the pipeline.

1. New York (17,985 rooms)
2. Atlanta (5,844 rooms)
3. Los Angeles (5,839 rooms)
4. Nashville (5,251 rooms)
5. Las Vegas (5,195 rooms)
6. Dallas (5,062 rooms)

“New York City remains positioned for a supply surge as we move deeper into the recovery timeline,” Hoyt said. “Demand has been improving in the market, but more supply from the final batch of pandemic reopenings as well as these new properties will continue to pressure occupancy levels. The return of business travel and groups was always going to be vital for New York City, but the urgency grows a bit when you throw more inventory into the equation.”

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