STR’s December 2016 Pipeline Report shows 560,199 rooms in 4,621 projects Under Contract in the United States. The total represents a 19.4% increase in the number of rooms Under Contract compared with December 2015.
Under Contract data includes projects in the In Construction, Final Planning and Planning stages, but does not include projects in the Unconfirmed stage.
In the In Construction stage, the U.S. reported 186,965 rooms in 1,424 projects. Based on the number of rooms, that is a 32.9% increase in year-over-year comparisons.
Among the Chain Scale segments, Upscale (61,565 rooms in 450 hotels) accounted for the most rooms In Construction followed by Upper Midscale (59,990 rooms in 592 hotels).
“Development trends remained the same throughout the year—limited service is by far the most popular segment for new projects with 65% of all construction activity in the U.S.,” said Bobby Bowers, STR’s senior VP for operations. “Most of the more than 120,000 rooms set to come online in the Upscale and Upper Midscale segments are expected to hit the market in 2017, and with occupancy levels forecasted to dip, we expect hoteliers to be focused in on pricing power in the coming months.”
Despite representing the lowest number of rooms in the pipeline, the Economy segment reported the largest percentage increase for rooms Under Contract (+125.6% to 11,073 rooms).
The Upper Upscale segment reported the largest percentage increase for rooms In Construction (+105.2% to 23,646 rooms).
“Aside from Luxury, all segments were well into double-digit construction growth for the month,” Bowers said.
U.S. pipeline by Chain Scale segment (number of rooms % change, December 2016 versus December 2015):
|Chain Scale||Existing Supply||% Change||In Construction||% Change||Under Contract||% Change|
Source: STR / report as of December 2016, activity reported through November 2016
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