STR Reports Global Hotel Pipelines for January 2015

According to the January 2015 STR Pipeline Report, there are 3,644 projects totaling 438,957 rooms Under Contract in the United States.

This number represents an 18.8% increase in the number of rooms Under Contract compared with January 2014 and a 31.8% increase in rooms under construction.

The Under Contract data includes projects in the In Construction, Final Planning and Planning stages but does not include projects in the Unconfirmed stage.

“The U.S. development pipeline continues to increase steadily. January rooms under construction hit 127,653, an increase of more than 6% from December 2014 and about one-third higher than January 2014,” said Bobby Bowers, senior VP of STR, Inc. “Upscale and Upper Midscale brands continue to dominate construction activity, accounting for two-thirds of the total. STR anticipates full-year 2015 U.S. room supply growth of 1.3% ... The pipeline continues to remain relatively in check when compared to the long-term average, which should help the industry maintain its current strong performance metrics. Lending parameters, development costs and the scarcity of some construction materials have led to excellent conditions in the hotel industry that are spurring some growth but not the over-the-top additions we’ve seen during some of the past up cycles.”

Among the Chain Scale segments, the Upper Upscale segment reported the largest increase in rooms in Under Contract, rising 33.7% to 33,391 rooms over January 2014. The Luxury segment followed with a 32.2% increase to 10,106 rooms. The Economy segment reported the largest decrease in the number of rooms Under Contract (-9.1% to 4,043 rooms).

All segments but Economy (-41.3% to 685 rooms) and Midscale (+9.5% to 5,583 rooms) reported increases in rooms under construction of more than 25.0% year over year. The Upper Upscale segment reported the largest increase, rising 79.5% to 14,449 rooms. The Upscale segment followed with a 32.2% increase to 47,222 rooms.

Asia Pacific Hotel Pipeline - January 2015

There are 2,400 hotels totalling 542,207 rooms Under Contract in the Asia Pacific region.

Among the countries in the Asia Pacific region, China reported the most rooms under construction with 140,952 rooms in 460 hotels. Five other countries reported more than 5,000 rooms under construction: Indonesia (28,652 rooms in 159 hotels); India (26,444 rooms in 161 hotels); Malaysia (11,885 rooms in 43 hotels); Japan (6,851 rooms in 29 hotels); and Philippines (6,773 rooms in 24 hotels).

Middle East / Africa Region Hotel Pipeline - January 2015

There are 633 hotels totalling 147,953 rooms Under Contract in the Middle East/Africa region,.

Among the Chain Scale segments, the Upper Upscale segment accounted for the largest portion of rooms in the Under Contract (36.0%) with 53,257 rooms. Two other segments each accounted for more than 15.0% of rooms in Under Contract: the Upscale segment (20.8% with 30,703 rooms) and the Luxury segment (18.8% with 27,820 rooms).

The Upper Upscale segment made up the largest portion of rooms under construction (40.3% with 29,770 rooms, followed by the Luxury segment (22.2% with 16,448 rooms) and the Upscale segment (19.9% with 14,699 rooms).

Europe Hotel Pipeline - January 2015

According to STR, there are 912 hotels totalling 144,374 rooms Under Contract in Europe.

Among the region’s key markets, Istanbul, Turkey, reported the largest number of rooms under construction with 4,981 rooms.

Four other markets ended the month with more than 1,500 rooms under construction: Greater London, England (4,470 rooms); Greater Amsterdam, Netherlands (2,368 rooms); Baku, Azerbaijan (1,654 rooms); and Greater Berlin, Germany (1,642 rooms).

Central / South America Hotel Pipeline - January 2015

There are 436 hotels totalling 69,718 rooms Under Contract in the Central/South America region. This represents a 14.3% year-on-year increase in rooms Under Contract and a 27.9% increase in rooms under construction.

Among the Chain Scale segments, the Upscale segment accounted for the largest portion of rooms Under Contract (21.2% with 14,787 rooms). Three other segments each accounted for more than 15.0% of rooms Under Contract: the Upper Midscale segment (20.4% with 14,189 rooms); Midscale (19.5% with 13,583 rooms); and Upper Upscale (19.2% with 13,407 rooms). The Unaffiliated segment made up the smallest portion of rooms Under Contract (3.9% with 2,710 rooms).

The Upscale segment accounted for the largest portion of rooms under construction (27.4% with 7,378 rooms), followed by the Midscale segment (17.7% with 4,773 rooms) and the Upper Midscale segment (17.6% with 4,723 rooms).

Caribbean / Mexico Hotel Pipeline - January 2015

There are 163 hotels totaling 28,698 rooms Under Contract in the Caribbean/Mexico region. This represents a 6.8% increase in rooms Under Contract, compared with January 2014, and a 7.6% decrease in rooms under construction.

Among the Chain Scale segments, the Upper Upscale segment reported the largest increase in rooms Under Contract, rising 34.6% with 4,529 rooms, followed by the Midscale segment (+25.9% with 2,717 rooms) and the Upscale segment (+17.8% with 6,109 rooms). The Unaffiliated segment reported the largest decrease in rooms Under Contract, falling 11.3% with 4,097 rooms.

Looking specifically at the In Construction stage, the Upper Upscale segment reported the largest year-over-year increase in rooms (+39.5% with 1,320 rooms). The Midscale segment followed with a 39.0% increase to 624 rooms. The Upper Midscale segment reported the largest decrease in rooms in the In Construction phase (-32.6% with 1,432 rooms).