Despite the rising cost of capital and ongoing supply-chain delays, hotel developers generally found ways to make their projects work in 2022.
November data from STR, CoStar’s hospitality analytics firm, shows that while hotel development overall is down compared to pre-pandemic levels, the number of hotel projects in the final planning stages of development has grown since January. The number of projects in the initial planning stage has dropped, indicating that projects underway have been able to progress while starting new projects remains challenging.
In January, there were 1,631 hotel projects with 179,400 rooms in the final planning stage, growing to 1,903 projects with 213,642 rooms by November. In the initial planning stage in January were 2,536 hotel projects with 294,611 rooms, and those numbers dropped to 2,078 projects with 236,251 rooms by November.
During the same time period, the number of hotels in the construction phase stayed relatively flat with 1,259 projects and 158,727 rooms in January and then 1,227 projects with 158,719 rooms in November.
By November, hotel projects in the middle of the chain scale led the overall U.S. pipeline’s planning, final planning and in-construction phases. In total, there were 834 midscale hotel projects with 62,347 rooms, 1,272 upscale hotel projects with 162,179 rooms and 1,884 upper-midscale hotel projects with 186,795 rooms.