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North America

Global Hotel Construction Pipeline Sets a New Record

Alan Woinski and Kim Woinski

February 29th, 2024

Skift Take

At the close of 2023, analysts state that the total global construction pipeline stands at 15,196 projects and 2,367,727 rooms, a 7% increase in projects and a 3% increase in rooms year-over-year.

The DJIA was up 47 points while Nasdaq was up 144, the S&P 500 was up 27 points and the 10-year treasury yield was down .02 to 4.25%. Lodging stocks were mixed. The companies that reported had a tough day with VCSA down -16%, SVC was down -11%, HGV was down -8% but INN was up 3%. AINC and AHT were up 11% and 8% respectively while HPK and XHR traded up to new highs.

We are getting to the tail end of earnings season. The worst response from the Street was definitely the Vacasa report, not so much from the earnings, as they were in line to better than expectations. VCSA did provide a full year guide but warned of bookings variability and churn, saying it doesn’t give them visibility. They announced another 320 job cuts and said their COO, John Banczak, is also stepping down on March 31.

Service Properties Trust did not get a good response to their earnings report. It looks like they missed on AFFO, with investors taking the stock down to a new 52-week low. They did have a lot of hotels under renovation in the quarter. They also mentioned weakness they are seeing in business travel on the conference call.

Summit Hotel Properties, on the other hand, reported an earnings beat, higher than expected 2024 guidance and the sale of three hotels for $84 million. INN is also marketing for sale another 101 room hotel.

Hilton Grand Vacations reported a 4Q earnings beat, despite the hit from the Macau fires and technical issues with their sales system in the quarter. HGV also guided higher than consensus for 2024.

Jefferies upgraded their rating on Xenia Hotels & Resorts to Buy from Hold. They do not believe the Street is giving them credit for renovations which are concluding and could greatly increase EBITDA. They upped their price target to $18 a share.

The redevelopment of St. Petersburg, Florida’s former police headquarters is preparing to break ground to construct a new hotel. Orange Station is located in the city’s Edge district and will add a Marriott Autograph Collection boutique hotel and 125,000 square feet of office space. It will also include a parking garage with 14,000 square feet of retail space and The Wye, a 42-unit apartment building. The project team called Edge Central Development Partners includes DDA DevelopmentJ Square DevelopersBackstreets Capital and Ellison Development.

Ashford Hospitality Trust, Inc. has signed a definitive agreement to sell the 390-room Hilton Boston Back Bay in BostonMassachusetts for $171 million. The sale is expected to be completed in March. The Company expects the net proceeds to be approximately $70 million after repayment of the underlying mortgage debt and closing costs. This clearly offset weaker than expected 4Q results as AHT shares jumped on the news. Baird reported on this saying they believe with these asset sales, AHT should be in position to repay the Oaktreefinancing within the next few months, resulting in a de-risking of the stock.

The highly anticipated $55 million Kilolani Spa at Grand Wailea, A Waldorf Astoria Resort, in Wailea, Hawaii, has opened. The all-new, open-air sanctuary encompasses 40 treatment rooms including couples’ treatment suites, a meditation lounge, reflection lounge, halotherapy-infused infrared saunas, hammam, hydrothermal gardens, movement studio and an outdoor saltwater pool. At 50,000 square feet, Kilolani Spa is the largest in the state. The newly renovated Grand Wailea, A Waldorf Astoria Resort boasts 777 rooms and 57 suites, five re-imagined restaurants, and adults-only and family-friendly pools.

Sumitomo Realty & Development has completed a lavish $14 million renovation of the Park Hyatt Los Angeles, a landmark hotel situated in the heart of Century City. The renovation project has transformed the Park Hyatt Los Angeles, encompassing extensive upgrades to its 366 guestrooms and a complete redesign of the lobby.

IHG Hotels & Resorts recently opened a new Holiday Inn Express & Suiteshotel in Dayton, Texas. Owned by Envision Partners LLC and managed by Sunway Hospitality, LLC, the newly-built Holiday Inn Express & Suites Dayton – Highway 90 provides 66 rooms, a fitness center and a business center.

Lotus Management Inc. plans to build a new Holiday Inn Express Hotel in Santa Maria, California. The four-story, 93-guestroom hotel will include a lounge, meeting room, pantry, gym, indoor pool and outdoor patio space.

Cobblestone Hotels and Suites broke ground on a new project in Foley, Alabama. The project’s completion is anticipated to occur within the coming year.

The Wabigoon Lake Ojibway Nation announced the start of construction on a new $25 million hotel and commercial mixed-use development in Dryden, Ontario. The new Studio 6 Extended Stay Suites franchise is expected to feature 70 suites, extensive green spaces and convention space.

The Q4 2023 Global Hotel Construction Pipeline Trend Report from Lodging Econometrics reveals that the global hotel construction pipeline hit all-time high project counts at Q4. At the close of 2023, LE analysts state that the total global construction pipeline stands at 15,196 projects and 2,367,727 rooms, a 7% increase in projects and a 3% increase in rooms year-over-year. The tables below summarize the key data points from the report.

Global Hotel Construction Pipeline Ending Q4 2023

Total Pipeline15,1962,367,727
Currently Under Construction6,1601,096,748
Scheduled to Start Next 12 Months3,850536,588
Early Planning Stage5,186734,391
Renovation and Conversion3,291510,584

Top Countries by Project Count Ending Q4 2023

United States5,964693,963
United Kingdom32243,990
Saudi Arabia30072,761

Top Cities by Construction Pipeline Ending Q4 2023

Dallas, Texas19322,291
Atlanta, Georgia15118,730
Nashville, Tennessee12316,148
Chengdu, China14829,575
Provincial cities, Saudi Arabia13328,656

Global Hotel Openings Forecast 2023-2025

YearNew Hotels OpenedRooms Opened
2024 (Forecast)2,550389,799
2025 (Forecast)2,804430,546

NH Hotel Group, controlled since 2019 by Minor, will take to the next shareholders’ meeting on April 19 to change its corporate name to Minor Hotels Europe & Americas and adapt, therefore, its bylaws to this change. In addition, NH will propose to the meeting the re-election of executive director Rufino Perez Fernandez and proprietary directors Stephen Andrew ChojnackiWilliam Ellwood Heinecke and Emmanuel Jude Dillipraj Rajakarier, all of them for the statutory term of three years. The company will also vote on the ratification of the co-opted appointment of Miriam Gonzalez-AmezquetaTomas Lopez Fernebrand and Maria Segimon de Manzanos as independent directors.

Personnel Moves

Elegant Hotel Collection has appointed luxury lifestyle brand and marketing strategist Anna Payne as Director of Marketing, Partnerships & Loyalty. Paynejoins the brand as it targets further growth in the sector, expanding on a limited invitation-only basis. Payne holds more than 15 years experience in the luxury and hospitality sectors, having achieved success with Small Luxury Hotels of the World and Firmdale Hotels.

Wyndham Hotels & Resorts announced the appointment of Murat Yilmaz as Market Managing Director for Central and Eastern Europe. Most recently, as Executive Advisor Business Development, Yilmaz led the global hotel development activities of the FTI GroupYilmaz will lead the implementation of Wyndham Hotels & Resorts’ operational strategies for a growing hotel portfolio in Central and Eastern Europe. He will also develop strategic relationships with existing and new Wyndham partners.

Lodging Dynamics Hospitality Group appointed Kathleen Bates as its Vice President of Operations. Kathleen has spent a significant portion of her career operating MarriottHilton and other premium brands hotels at every level.

Expotel Hospitality added Ed Robison to its executive team to serve as the company’s Chief Development Officer. In his new position, Ed will play a key role in the development of proactive business partnerships and play a crucial role in the company’s growth and success, driving the expansion of its unique hospitality experience into new markets. Ed will provide general support and education for owners as well as assistance in development. Previously, Ed served as Senior Vice President Owner Relations and Development with HP Hotels.

United Hospitality Management appointed Greg O’Stean as the Chief Executive Officer. A seasoned professional with over 30 years experience, O’Stean brings a wealth of strategic prowess and leadership acumen to lead UHM into a new phase of growth and success in the Middle Eastern, European markets and beyond. Prior to helming the leadership seat at UHMO’Stean served as the Global Chief Development Officer at Aimbridge Hospitality.

Alan Woinski and Kim Woinski

February 29th, 2024

Companies: Vacasa, Aimbridge Hospitality, Ashford Hospitality Trust, Autograph Collection, Cobblestone Hotels, Elegant Hotel Collection, Expotel Hospitality, Hilton, Hilton Grand Vacations, Hilton Hotels & Resorts, Holiday Inn Express, Hyatt Hotels Corporation, IHG Hotels & Resorts, Minor Hotels, NH Hotels, Park Hotels and Resorts Inc., Park Hyatt, Service Properties Trust, Summit Hotels, United Hospitality Management, Waldorf Astoria Hotels & Resorts, Wyndham Hotels & Resorts, Xenia Hotels & Resorts

Locations: Alabama, Boston, California, Florida, Hawaii, Los Angeles, Ohio, Ontario

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