Hotel development remains surprisingly strong despite the weak economy, with the domestic construction pipeline at a record high in the first quarter of the year, Lodging Econometrics said in its quarterly report.
Although project cancellations are increasing, the report said they are outpaced by new project announcements, which hit an all-time high of 125,442 rooms during the period, the report said
“The pipeline continues to soar. It's a 60,920-room boost, an 8.5% increase over Q4 2007, and the 17th consecutive quarterly increase dating back to 2004. All projects have dedicated land parcels, are being actively pursued by developers and have been verified by the brands, “said Patrick Ford, president of Lodging Econometrics.
“Developers remain bullish about the future. For hotels under 200 rooms in the upscale, mid-market and economy sectors, financing is still available, albeit at much more difficult terms. At this time, regional banks and dedicated national lodging real estate lenders continue to be less constrained by the lending crisis.”
Ford said 73 projects larger than 200 rooms were among the newly announced projects. Thirteen projects are casinos while 13 others already have been branded, seven by Marriott. The remaining projects are presently classified as independents.