STR: U.S. hotel pipeline shows confidence in business travel
HENDERSONVILLE, TENNESSEE – Upper upscale hotels, the property types most associated with business travel, are well represented in the U.S. development pipeline. The volume of projects in the segment points to confidence in the future of business travel, according to STR.
“Upper upscale saw the slowest recovery, but a steady climb in performance and the business travel indicators have supported developer confidence in the segment,” said Isaac Collazo, STR’s VP, analytics. “The more than 23,000 upper upscale rooms in construction right now represent 3.4% of the segment’s existing supply. That is well above the long-term growth average (+2%) in the U.S.”
U.S. Hotel Pipeline
March 2023 (percentage change in comparison with March 2022):
- In Construction: 154,284 rooms (-0.5%)
- Final Planning: 239,995 rooms (+34.6%)
- Planning: 232,517 rooms (-21.6%)
After three consecutive month-over-month increases, the overall number of U.S. rooms in construction fell slightly in March, which aligns with patterns in previous years. Among the chain scale segments, luxury shows the highest number of rooms as a percentage of existing supply.
- Luxury (5.2%, 7,136 rooms)
- pscale (4.1%, 36,089 rooms)
- Upper Midscale (3.7%, 43,470 rooms)
- Upper Upscale (3.4%, 23,564 rooms)
- Midscale (2.1%, 10,363 rooms)
- Economy (1.0%, 6,302 rooms)
“Luxury, though the smallest in terms of room count, shows the highest projected growth against existing supply, matching the rate gains experienced in the segment over the last few years,” Collazo said. “Select-service (upper midscale + upscale) continues to grow as well, which is no surprise given how well the segment of the market has regained demand. The upper tier of select-service also caters to the business traveler.”
The article STR: U.S. hotel pipeline shows confidence in business travel first appeared in TravelDailyNews International.