U.S. Hotel Construction Pipeline Grows 5% YOY in Q1 2025, Early Planning Stage Surges 10%

As seen in Lodging Econometrics’ (LE) Q1 2025 U.S. Hotel Construction Pipeline Trend Report, at the close of the quarter, the pipeline consists of 6,376 projects and 749,561 rooms. These first quarter totals represent a 5% year-over-year (YOY) increase in projects and a 6% YOY increase in rooms compared to Q1 2024.

Currently, there are 1,152 projects comprising 145,368 rooms under construction in the U.S., up 1% by projects and 3% by rooms YOY. Projects scheduled to start construction anytime within the next 12 months total 2,286 projects with 263,370 rooms at Q1, reflecting a 1% rise in both projects and rooms YOY. Most notably, project and room totals in the early planning stage experienced significant growth, increasing 10% by projects and 13% by rooms YOY, standing at 2,938 projects and 340,823 rooms, respectively.

The top three chain scales by total projects at the end of Q1 are upscale, at 1,443 projects/179,295 rooms, upper midscale, at 2,338 projects/226,349 rooms, and midscale at 974 projects/82,094 rooms. These three chain scales account for approximately 75% of the projects in the total U.S. construction pipeline at the end of the first quarter. Notably, however, upper upscale chain scale projects in the U.S. pipeline reached record highs of 362 projects and 70,603 rooms at Q1, up 10% by projects and 7% by rooms YOY. Similarly, the midscale chain scale hit all-time highs at Q1 with 974 projects/82,094 rooms, increasing 10% by projects and 9% by rooms YOY.

LE’s latest U.S. Hotel Construction Pipeline Trend Report also highlights the continued growth in brand conversions at Q1, which reached a new record-high of 1,421 projects with 136,668 rooms, growing 13% by projects and 16% by rooms YOY. Combined hotel conversion and renovation activity hit a record-high project total at Q1 with 2,050 projects/269,435 rooms.

New project announcements (NPAs) announced into the pipeline during Q1 stand at 313 projects/37,912 rooms. Projects starting construction during the first quarter of 2025 increased 21% by projects and 41% by rooms compared to Q4 2024 new construction start totals. This indicates that in Q1 developers pressed forward with their current projects, suggesting an upbeat approach to development for the first quarter of 2025.

From January through March of 2025, 161 new hotels with 18,767 rooms opened across the United States. For Q2-Q4 of 2025, LE analysts forecast an additional 579 projects with 64,781 rooms to open, resulting in 740 new hotels opening with 83,548 rooms by year-end, resulting in a 1.5% growth rate. Looking ahead, LE analysts anticipate 848 new hotels with 92,892 rooms to open by year-end 2026, for an increase in supply of 1.6%.

Top U.S. Markets for Hotel Development Still Rolling Along at Q1 2025 Close

The recent U.S. Hotel Construction Pipeline Trend Report from Lodging Econometrics (LE) reports that, at the close of the first quarter of 2025, the top five markets with the largest hotel construction pipelines are led by Dallas with 203 projects/24,496 rooms, a new all-time-high room total representing 9% project and 11% room growth year-over-year (YOY). Following Dallas is Atlanta with 166 projects/19,149 rooms, Nashville with 127 projects/16,589 rooms, Phoenix with 126 projects/16,490 rooms, and Austin with 124 projects/14,514 rooms, which also achieved new all-time-high project and room totals, showing impressive 11% project and 9% room growth YOY.

U.S. markets with the greatest number of projects already under construction at the Q1 close are New York with 39 projects/7,064 rooms, Phoenix with 34 projects/5,023 rooms, and Dallas with 31 projects/3,706 rooms. Atlanta follows with 26 projects/3,182 rooms and the Inland Empire with 22 projects/2,399 rooms under construction.

Dallas has the most projects scheduled to start anytime in the next 12 months, with 80 projects/8,890 rooms. Following Dallas are Atlanta with 61 projects/7,452 rooms, Nashville with 50 projects/7,058 rooms, Austin with 47 projects/5,347 rooms, and the Inland Empire with 46 projects/4,652 rooms.

Dallas leads the U.S. Markets with the largest number of projects in early planning again, with 92 projects/11,900 rooms. Atlanta follows with 79 projects/8,515 rooms, Austin with 61 projects/6,988 rooms, Nashville with 57 projects/6,892 rooms, and the Inland Empire with 55 projects/5,384 rooms.

Additional markets of note include Raleigh-Durham, which reached new all-time-high project and room totals with 68 projects/8,774 rooms, and Saint Louis with a new all-time-high project total of 47 projects/5,271 rooms.

During the first quarter of 2025, 138 new projects, accounting for 19,800 rooms, were announced within the top 50 U.S. markets. The leading markets for new project announcements (NPAs) include Dallas, with 9 projects and 2,011 rooms, Austin, with 9 projects and 988 rooms, and New York, with 8 projects and 1,595 rooms. These markets are followed by Nashville, Atlanta, and Denver, each with 7 projects and accounting for 996 rooms, 757 rooms, and 688 rooms, respectively.

Renovation and brand conversion activity remains robust throughout the United States at Q1. The Washington DC market leads with the largest count of combined renovation and conversion projects with 35 projects/5,025 rooms. The Charlotte market follows with 34 projects/3,729 rooms, then the Atlanta market with 33 projects/3,709 rooms, the Houston market with 30 projects/4,060 rooms, and the Chicago market with 28 projects/5,742 rooms.

In the first quarter in the U.S., 161 new hotels/18,767 rooms opened, led by the Atlanta market with 7 new hotels/733 rooms, the Dallas market with 6 new hotels/534 rooms, and the New York market with 5 new hotel openings/498 rooms. LE analysts forecast another 579 new hotels/64,781 rooms to open across the U.S. through Q2-Q4 2025, for a total of 740 new hotels/83,548 rooms to open by year-end.

Among the U.S. markets with the greatest number of new hotels forecast to open in 2025, New York again tops the chart with 31 new hotels with 3,926 rooms expected to open, followed by Dallas with 20 new hotels/2,133 rooms and Atlanta with 19 new hotels/2,284 rooms.

For the 2026 forecast, LE analysts expect 848 new hotels/92,892 rooms to open in the U.S. by year-end. The Dallas market is expected to lead in new hotel openings in 2026, with 26 new hotels/2,611 rooms forecast to open, followed by the Atlanta market with 24 new hotels/2,539 rooms, then the Phoenix market and the Inland Empire, each with 23 new hotels expected to open accounting for 3,587 and 2,207 rooms, respectively.