The first quarter of 2025 has given hotel operators and investors much to rejoice about, as demonstrated by a boom in hotel construction, planned or underway, especially in five of the nation’s biggest cities. And the cheerful forecast extends into 2026.
According to the U.S. Hotel Construction Pipeline Trend Report prepared by Lodging Econometrics (LE), at the close of the quarter, the nation’s hotel construction pipeline included 6,376 projects and 749,561 rooms, up 5% and 6% respectively from 1Q 2024. That comprised 1,152 projects under construction, 2,286 scheduled to start construction within the year, and 2,938 projects in the early planning stages – a category which experienced significant growth.
The greatest number of projects (1,433) were upscale, upper midscale (2,338) and midscale (974). They accounted for approximately 75% of the developments nationwide.
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The report identified five metros with the nation’s largest construction pipelines: Dallas, Atlanta, Nashville, Phoenix and Austin.
Dallas led the country with 203 projects involving 24,496 rooms – an all-time high room total. The metro ranked third in terms of projects under construction with 31, representing 3,706 rooms. It also had the most developments scheduled to begin during the year (80) and ranked first for the number of projects in early planning (92) and new announcements (nine).
Atlanta followed, with 166 comprising 19,149 rooms. Atlanta had 26 with 3,182 rooms under construction. In the coming year, 61 projects were scheduled to start; 79 were in the planning stage, and seven new ones had been announced.
Nashville’s construction pipeline included 127 projects and 16,589 rooms in various stages of development. The city had 50 projects with 7,058 rooms scheduled for the coming year, while 57 were in the early planning stages and seven more had been announced.
Phoenix had 26 with 14,514 rooms in the pipeline. Of these, 5,023 rooms were under construction.
The report said Austin’s all-time high project (124) and room (14,514) totals showed “impressive 11% project and 9% room growth year-over-year.”
The city had 47 developments, including 5,347 rooms, scheduled to start in the coming year, with 61 projects in early planning stages and nine with announcements that were made.
Among all U.S. cities, New York had the greatest number of projects (39 with 7,064 rooms) under construction, with announcements for an additional eight already made. It also ranked third in the number of new hotels (5) that opened in 1Q 2025 and led the list in the number expected to open this year (31 with 3,926 rooms).
The Inland Empire, Raleigh-Durham, and St. Louis were other hotel markets with strong pipelines.
The report also noted robust renovation and brand conversion activity in the U.S. during the quarter. The largest number occurred in the Washington, DC market with 35 projects and 5,025 rooms. There was also strong activity in Charlotte, Atlanta, Houston, and Chicago.
In total, 138 new hotel developments with 19,800 rooms were announced in the first quarter for the top 50 U.S. markets. Additionally, the quarter saw 161 new hotels with 18,767 rooms open. Atlanta had the highest number (seven), followed by Dallas and New York.
“For Q2-Q4 of 2025, LE analysts forecast an additional 579 projects with 64,781 rooms to open, resulting in 740 new hotels opening with 83,548 rooms by year-end, resulting in a 1.5% growth rate. Looking ahead, LE analysts anticipate 848 new hotels with 92,892 rooms to open by year-end 2026, for an increase in supply of 1.6%,” the report stated.
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