Hotel construction activity across all four regions witnessed a year-over-year decline, with Asia Pacific being the only one coming closest to its 2022 comparable, according to the March 2023 pipeline data from hospitality analytics firm STR. The data shows that the COVID-19 pandemic has continued to disrupt the hotel industry’s expansion plans, with hotel construction
Hotel construction activity across all four regions witnessed a year-over-year decline, with Asia Pacific being the only one coming closest to its 2022 comparable, according to the March 2023 pipeline data from hospitality analytics firm STR.
The data shows that the COVID-19 pandemic has continued to disrupt the hotel industry’s expansion plans, with hotel construction activity seeing a significant decline in March 2023 compared to March 2022.
Europe experienced the steepest decline, with hotel construction activity decreasing by 18.2% from March 2022, with 184,851 rooms currently under construction. The number of rooms in the final planning and planning stages also fell by 15.9% and 5.4%, respectively. The total number of rooms under contract in the region is 474,526, down 13.7% from the previous year. Germany and the UK lead Europe in total rooms under construction, with 34,030 and 29,160 rooms, respectively.
In Asia Pacific, there were 476,993 rooms under construction, representing a modest decline of 0.8% compared to March 2022. However, the number of rooms in the final planning and planning stages dropped significantly by 29.6% and 1.9%, respectively. China leads the way in construction activity in the region, with 299,458 rooms currently under construction, followed by Vietnam with 36,358 rooms. The total number of rooms under contract in the region is 904,935, down 4.4% from the previous year.
In the Middle East and Africa, 119,505 rooms were under construction, reflecting a decline of 5.8% compared to March 2022. However, the number of rooms in the final planning and planning stages increased by 20.4% and 21.2%, respectively. Most of the region’s pipeline activity is focused in the Middle East, with Saudi Arabia and the United Arab Emirates leading construction activity. The total number of rooms under contract in the region is 249,150, up 6.4% from the previous year.
In the Americas, the number of rooms under construction fell by 4.5% compared to March 2022, with 197,844 rooms currently under construction. The number of rooms in the final planning stage fell by 19.6%, while the number of rooms in the planning stage increased by 32.2%. The United States leads in construction activity in the region, with 702,123 rooms currently under contract. After the US, Mexico, Canada, and Brazil have the highest number of rooms in construction.
The COVID-19 pandemic has disrupted the hotel industry and its expansion plans. However, hotel developers remain optimistic, and several major hotel brands have announced ambitious expansion plans. In Europe, Accor plans to open 200 new hotels by 2023. In Asia, Marriott International aims to open 100 new hotels in China in 2023.
The hospitality industry is expected to recover gradually as the world emerges from the pandemic. Hotel developers will continue to focus on expanding their portfolio in anticipation of the post-pandemic recovery.
Written by: Supaporn Pholrach (Joom)
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