The U.S. Hotel Construction Pipeline Surpasses 6,200 Projects at Q3 2024

According to the Q3 2024 U.S. Hotel Construction Pipeline Trend Report from Lodging Econometrics (LE), the total U.S. pipeline stands at 6,211 projects/722,821 rooms, up 9% by projects and 7% by rooms Year-Over-Year (YOY). This marks a new all-time high for projects in the U.S., surpassing previous pipeline records.

At the close of the third quarter, there are 1,185 projects/148,716 rooms under construction, marking an 11% increase in projects and a 6% increase in rooms YOY. Projects scheduled to start construction in the next 12 months total 2,209 projects/251,797 rooms. Projects and rooms in early planning reached new all-time highs, at 2,817 projects/322,308 rooms, up 17% by both projects and rooms YOY.

LE analysts report that the upper midscale chain scale continues to have the largest project count in the U.S. pipeline, reaching a new all-time high of 2,315 projects/224,703 rooms. Following is the upscale chain scale with 1,407 projects/174,127 rooms. Together, these two chain scales comprise 60% of all projects in the total pipeline. The midscale segment also showed significant growth, reaching an all-time high with 928 projects/77,600 rooms, up 19% by projects and 16% by rooms YOY.

Construction starts grew to the highest level in 2024 to end the quarter, with 181 projects/20,840 rooms, up 18% by projects and 25% by rooms YOY. At Q3, brand conversion activity also reached an all-time-high project count with 1,247 projects/120,912 rooms. Combined with renovation activity of 722 projects/141,136 rooms, the total renovation and brand conversion pipeline in the U.S. stands at 1,969 projects/262,048 rooms.

Through the third quarter, 408 new hotels with 48,258 rooms opened in the U.S., with another 223 projects/23,902 rooms anticipated to open by year-end 2024. LE projects 2024 to finish at 631 new hotels with 72,160 rooms, a 1.3% supply increase. Looking ahead, LE analysts forecast 759 new hotels/86,264 rooms to open in calendar year 2025, representing a 1.5% supply increase. For 2026, LE forecasts 938 new hotels/101,017 rooms to open, amounting to a supply increase of 1.8%.

Dallas Leads Nation’s Hotel Boom: Nearly 200 Projects Set to Transform Texas Hospitality Landscape

According to the Q3 2024 U.S. Hotel Construction Pipeline Trend Report from Lodging Econometrics (LE), at the close of the quarter, the five markets with the largest hotel construction pipelines are led by Dallas with a record-high of 194 projects and 22,803 rooms, followed by Atlanta with a record-high 166 projects accounting for 19,174 rooms, Nashville with a record-high 130 projects and 16,966 rooms, Phoenix with 123 projects/15,999 rooms, and Austin with a record-high 119 projects accounting for 13,962 rooms. These top five markets combined account for 732 projects/88,904 rooms.

At Q3, five U.S. markets stand out for their active under construction hotel projects. New York leads with 42 projects/6,771 rooms, followed by Dallas with 30 projects/3,443 rooms. Atlanta is third with 26 projects/3,001 rooms, while Phoenix and Nashville follow with 25 projects/4,522 rooms and 23 projects/3,269 rooms, respectively.

Dallas, with 73 projects/8,708 rooms, has the most projects scheduled to start in the next 12 months. Following Dallas are Atlanta with 62 projects/7,708 rooms, Inland Empire with 57 projects/5,670 rooms, Phoenix with 55 projects/6,620 rooms, and Austin with 49 projects/5,797 rooms.

Dallas also tops the list of markets with the most hotel projects in the early planning stage at Q3, boasting 91 projects that will add 10,652 rooms. Atlanta follows with 78 projects set to bring 8,465 rooms, while Nashville has 64 projects totaling 7,885 rooms. Austin and Los Angeles round out the top five, with Austin at 55 projects/6,434 rooms and Los Angeles at 51 projects/8,491 rooms.

In the third quarter, LE recorded a combined U.S. renovation and conversion total of 1,969 active projects with 262,048 rooms. The markets with the largest combined number of renovations and conversions at Q3 are Chicago with 34 projects/7,704 rooms, Atlanta with 31 projects/4,557 rooms, Phoenix with 29 projects/5,267 rooms, Washington, DC-MD-VA with 29 projects/4,452 rooms, and Los Angeles with 28 projects/4,468 rooms.

Four hundred one new project announcements (NPAs), accounting for 42,413 rooms, were announced during the third quarter. At Q3, Dallas, with 15 projects/1,549 rooms, has the largest number of new projects announced into the pipeline, followed by Atlanta with 11 projects/1,104 rooms, Austin with 9 projects/909 rooms, Nashville with 8 projects/1,142 rooms, and Fort Worth-Arlington with 7 projects/1,145 rooms.

According to LE analysts, 408 new hotels with 48,258 rooms opened in the U.S. through Q3 2024. Of these openings, 67% of hotels (60% of rooms) were in suburban locations, and 47% of hotels (54% of rooms) were in the top 50 markets.

The LE forecast for new hotel openings for the remainder of 2024 in the U.S. includes an additional 223 hotels with 23,902 rooms, bringing the year-end 2024 projection to 631 new hotels with 72,160 rooms to open. The New York market is forecast to open 20 new hotels/2,181 rooms, followed by Atlanta and Dallas each with 16 new hotels (2,898 and 2,045 rooms respectively), Orlando with 13 new hotels/2,398 rooms, and Indianapolis with 12 new hotels/1,347 rooms.

Looking ahead, LE forecasts 759 new hotel openings/86,264 rooms in 2025 and 938 new hotel openings/101,017 rooms in 2026. For 2025, New York leads with 23 new hotels/3,147 rooms forecast to open, followed by Nashville and Dallas each with 18 new hotels (2,463 and 1,820 rooms respectively), Phoenix with 17 new hotels/2,864 rooms, and Inland Empire with 16 new hotels/1,530 rooms. In 2026, LE analysts forecast 938 new hotels/101,017 rooms to open in the U.S.