Global Construction Pipeline Trends: Hilton and Marriott Lead the Way

The Q2 ’23 Global Construction Pipeline Trend Report from Lodging Econometrics (LE) reveals significant insights into the worldwide construction landscape. Here are the key highlights:

Rising Global Construction Pipeline:

• The total global construction pipeline comprises 14,572 projects, with a staggering 2,310,238 rooms. This marks a 3% increase in projects and a 1% rise in rooms year-over-year (YOY).

Construction Phases:

• As of the second quarter, 6,154 projects with 1,108,498 rooms are under construction.
• Additionally, 3,679 projects with 506,760 rooms are scheduled to begin within the next 12 months.
• A further 4,739 projects with 694,980 rooms are in the early planning stages.

Dominance of Luxury and Upscale Chains:

• Luxury, upper upscale, and upper midscale hotel chains lead the global pipeline, accounting for 47% of all projects.
• Upper midscale projects constitute 29% of the total global pipeline, with a record-breaking 4,236 projects and 558,159 rooms.
• Upper upscale projects total 1,653, while luxury hotel projects have increased by 10% YOY, closing the quarter at 909 projects and 180,538 rooms.

Top Countries in the Pipeline:

• The United States leads the global construction pipeline with 5,572 projects and 660,061 rooms, making up 38% of the projects.
• China follows closely with 3,666 projects and 678,965 rooms, accounting for 25% of the global pipeline.
• India, the United Kingdom, and Saudi Arabia are also noteworthy, with India having 480 projects and 57,161 rooms, the UK with 322 projects and 45,181 rooms, and Saudi Arabia with 276 projects and 72,144 rooms.

Leading Markets:

• Dallas tops the list of markets with the largest pipeline counts worldwide, boasting 184 projects and 21,501 rooms.
• Atlanta follows with 141 projects and 17,993 rooms, and Chengdu is not far behind with 140 projects and 27,890 rooms.
• Phoenix and Shanghai round out the top five markets.

Franchise Companies at the Helm:

• Three franchise giants collectively account for 50% of projects in the global pipeline.
• Hilton Worldwide leads with 2,808 projects and 398,742 rooms, followed by Marriott International with 2,679 projects and 429,925 rooms.
• IHG Hotels & Resorts ranks third with 1,764 projects and 259,668 rooms.

Prominent Brands:

• The upper midscale segment is prominent among the top three franchise companies. Hilton’s Hampton Inn brand boasts 790 projects and 102,607 rooms.
• IHG’s Holiday Inn Express has 599 projects and 74,036 rooms, and Marriott’s TownePlace Suites stands at 364 projects with 34,125 rooms.
• Other notable brands include Accor’s upscale Novotel with 137 projects and 26,474 rooms and Hyatt’s upscale Hyatt Place with 105 projects and 16,408 rooms.

Growth Outlook:

• The first half of 2023 saw the opening of 868 new hotels, totaling 129,047 rooms globally.
• An additional 1,663 hotels with 251,468 rooms are scheduled to open by year-end.
• LE analysts predict a total of 2,531 new hotels with 380,515 rooms to open in 2023.
• In 2024, new openings are expected to reach 2,674 hotels, accounting for 415,699 rooms.
• Looking ahead to 2025, LE analysts forecast 2,701 new hotels with 429,006 rooms set to open worldwide.

This report provides a comprehensive view of the thriving global construction pipeline within the hospitality industry.