Skip to content

Search

Latest Stories

CoStar: U.S. hotel construction down in March

The month saw 144,760 rooms under construction

Line graph showing U.S. hotel rooms under construction from January 2006 to March 2025, peaking at 220.2K in April 2020 and declining to 144.8K in March 2025, per CoStar and STR data

The number of U.S. hotel rooms under construction declined for the third straight month in March, down 103 projects from the same time last year, according to CoStar.

U.S. Hotel Construction Declines 7.5% in March 2025

THE NUMBER OF U.S. hotel rooms under construction declined year over year for the third consecutive month in March, according to CoStar. Construction was down by 103 projects compared to last year.

About 144,760 rooms were under construction in March, a 7.5 percent decrease from the same month in 2024, CoStar found. Final planning included 273,068 rooms, up 3.7 percent, while 359,878 rooms were in the planning stage, a 10.9 percent year-over-year increase.


“With increased uncertainty and the potential for rising construction costs, it’s not surprising that fewer projects have broken ground,” said Isaac Collazo, STR’s senior director of analytics. “The decline of 103 hotels means most markets are seeing one fewer project in the final phase. Still, the overall pipeline remains robust, with 6,500 hotels and 777,000 rooms including planning phases.”

“We’ll be watching those planning phases closely, as that’s where economic uncertainty is likely to have the most impact,” he added. “Projects already under construction are moving forward.”

By chain scale in March, the luxury segment had 6,421 rooms under construction, a 4.1 percent year-over-year increase. The upper upscale segment had 18,813 rooms, up 2.6 percent, upscale had 35,082 rooms, up 3.8 percent, and upper midscale had 38,217 rooms, up 3.2 percent. Midscale recorded 13,883 rooms, up 2.7 percent, and economy had 5,993 rooms, up 0.9 percent.

Collazo noted the construction decline was concentrated in upper midscale, which made up more than a third of the overall drop in room count and an even greater share of hotel count.

“Even with the decrease, upper midscale still accounts for the largest number of hotels and rooms under construction,” he said.

Separately, The Highland Group reported that U.S. extended-stay hotels outperformed the broader industry in March across all key metrics except occupancy, where their long-term premium held steady.

More for you

 'America the Beautiful' Campaign Launched by Brand USA

Brand USA launches 'America the Beautiful' campaign

Summary:

  • Brand USA launched its “America the Beautiful” campaign to increase international visitation.
  • The campaign targets nine markets and includes an AI-powered trip planning hub.
  • It promotes 2026 U.S. events, including the World Cup and the nation’s 250th anniversary.

BRAND USA LAUNCHED “America the Beautiful,” a global tourism campaign to increase international visitation and hotel demand. The campaign was announced at Brand USA Travel Week U.K. & Europe 2025 in London.

The initiative aligns with $147 billion in travel exports through July, up 2 percent year over year, Brand USA said in a statement. The spending is projected to generate $39.6 billion in federal tax revenue, support millions of U.S. jobs and add $551 billion to the economy in 2025.

Keep ReadingShow less