The U.S. hotel construction pipeline experienced notable growth in the first quarter of 2025, as reported by Lodging Econometrics (LE). By the close of Q1, there were 6,376 projects in progress, translating to a total of 749,561 rooms.
This represents a 5% increase in the number of projects and a 6% rise in the number of rooms compared to the same period in 2024.
Projects and Rooms Under Construction
As of the first quarter of 2025, 1,152 hotel projects were under construction, totaling 145,368 rooms. This reflects a modest 1% increase in project count and a 3% rise in the number of rooms from Q1 2024.
A significant portion of the pipeline is made up of projects scheduled to begin in the next 12 months, with 2,286 projects and 263,370 rooms planned to start soon. Both the number of projects and rooms in this category rose by 1% year-on-year.
The most significant growth, however, is found in the early planning stages, where the number of projects increased by 10% and the room count grew by 13% compared to the previous year. Currently, there are 2,938 projects and 340,823 rooms in the early planning phase, signaling a positive outlook for the hotel construction industry.
Chain Scale Trends in the Hotel Pipeline
The hotel pipeline in the U.S. remains largely concentrated in three primary chain scales: upscale, upper midscale, and midscale. At the end of Q1, upscale hotels accounted for 1,443 projects and 179,295 rooms, while upper midscale hotels represented the largest share with 2,338 projects and 226,349 rooms.
Midscale hotels followed with 974 projects and 82,094 rooms. These three chain scales combined represent about 75% of all hotel projects in the U.S. pipeline.
A key trend is the growth in upper upscale projects, which reached record highs in both the number of projects and rooms. The pipeline now includes 362 upper upscale projects with 70,603 rooms, marking a 10% increase in projects and a 7% rise in rooms year-on-year.
Likewise, midscale chain scale projects also set new records, with a 10% increase in projects and a 9% rise in rooms compared to the previous year.
Growth in Hotel Conversions and New Openings
Conversions and renovations also saw substantial growth in Q1 2025. The report highlights a record number of conversion projects, with 1,421 projects and 136,668 rooms in the pipeline. This reflects a 13% increase in the number of projects and a 16% increase in rooms from Q1 2024. When renovation projects are included, the total number of projects rises to 2,050, involving 269,435 rooms.
For new construction, 313 projects were announced during the first quarter, comprising 37,912 rooms. The quarter also saw a 21% increase in the number of projects that broke ground, with a 41% rise in rooms compared to the previous quarter. These figures suggest developers are optimistic and continue to move forward with their projects.
Looking ahead, 161 new hotels, with 18,767 rooms, are projected to open across the U.S. between January and March of 2025. By the end of the year, an additional 579 projects, adding 64,781 rooms, are expected to open, bringing the total number of new openings for 2025 to 740 hotels with 83,548 rooms. This represents a 1.5% increase in hotel supply.
The US hotel construction pipeline grew by five percent in Q1 2025, with over six thousand projects underway, reflecting strong demand and optimism in the hospitality sector as developers work to meet rising accommodation needs.
Looking further into the future, analysts predict that by the end of 2026, 848 new hotels with 92,892 rooms will open, resulting in a 1.6% growth in hotel supply.
