Developers are set to open 61 new hotels to the New york City market next year as the sector continues to experience a construction boom.
According to the third quarter construction pipeline trend report published by Lodging Econometrics (L.E.), the city has the second biggest pipeline of hotel construction projects behind Los Angeles.
The report found that LA has 161 projects in its pipeline creating 26,670 rooms. Next are New York and Dallas with 155 projects/26,605 rooms and 160 projects/20,020 rooms, respectively. Houston follows with 138 projects/14,130 rooms, and Atlanta with 137 projects/18,396 rooms.
The total pipelines for the top 25 markets account for 39.7 percent of all pipeline rooms and when built out represent a potential growth rate of 15.9 percent over all existing open and operating rooms.
While overall supply growth has risen to two percent year to date in 2019, it’s 2.5 percent in the top 25 markets and 1.7 percent in the other markets nationwide.
In the first three quarters of 2019, the U.S. opened 704 new hotels with 81,111 rooms.
The markets with the highest number of new openings are New York City with 28 hotels/4,513 rooms, Dallas with 26 hotels/3,073 rooms, Houston with 18 hotels/2,285 rooms, Boston with 16 hotels/2,435 rooms and Nashville with 15 hotels/1,965 rooms.
These five markets alone account for 15 percent of all new hotels that opened in the U.S. through the end of the third quarter.
For the last three years Dallas, with 92 hotels, opened the most hotels. New York with 90, Houston at 76, Nashville with 62 and Atlanta with 58 follow. All but Nashville show supply growth in excess of demand growth year-to-date in 2019.
The markets forecast to open the greatest number of new hotels in 2020 are New York City with 61 new hotels/8,283 rooms, Dallas with 35 new hotels/3,852 rooms and Los Angeles with 24 new hotels/3,370 rooms.
In 2021, Dallas leads the forecast for new hotel openings with 43 hotels/5,283 rooms followed by Houston and Los Angeles with 39 new hotels/3,725 rooms and 27 new hotels/3,868 rooms respectively.
In the next three years, markets with the highest number of new hotels (supply) expected to open are: New York with 123, Dallas 107, Houston 87, Atlanta 72 and Nashville with 67.