Data from hotel-industry analyst STR shows that the number of upper-upscale and upscale hotel rooms presently under construction—which means they will almost certainly open within 12 to 18 months—is notably higher than the year before. This rate of development could ease pressure on meeting planners who are trying to execute events on budgets squeezed by rising room rates due to post-pandemic group demand and inflation.
The more than 23,000 upper-upscale rooms under construction right now across the country represent 3.4 percent of that segment’s existing supply, “and that is well above the long-term average growth rate—two percent—in the U.S.” said Isaac Collazo, STR’s vice president of analytics, in a press release. “A steady climb in performance and in business-travel indicators have supported developers’ confidence in this segment.”
As for the upscale segment—populated by brands such as AC by Marriott, Cambria, Courtyard by Marriott, Crowne Plaza, Delta, Hilton Garden Inn, Hyatt Place, and Wyndham—guest-room growth is also higher than the long-term average. In fact, the annual increase in rooms under construction in the upscale segment—4.4 percent—is significantly higher than for upper-upscale. A total of about 36,600 guest rooms will be added to the upscale hotel market by the end of 2024.
For planners of executive meetings and incentives, there’s even better news: the number of luxury-hotel rooms under construction is up 5.2 percent versus 2022. Put another way: About 7,140 more luxury-property rooms should be open around the U.S. by the end of 2024.