Summary:
- U.S. hotel rooms under construction fell year over year for the ninth month, CoStar reported.
- About 137,956 rooms were under construction in September, down 12.3 percent from 2024.
- In September, 12,746 midscale and 4,559 economy rooms were under construction.
U.S. HOTEL ROOMS under construction fell year over year for the ninth consecutive month in September, reaching the lowest level in 40 quarters, according to CoStar. Still, more rooms are under construction now than after the Great Recession.
About 137,956 rooms were under construction in September, down 12.3 percent from the same month in 2024, CoStar reported. Final planning included 258,836 rooms, a 3.5 percent decline, while 327,304 rooms were in planning, a 2.6 percent decrease year over year.
“Construction fell to the lowest point of the past 40 quarters, more than 80,000 rooms below the peak from the third quarter of 2020,” said Isaac Collazo, STR’s senior director of analytics. “Uncertainty often leads to inaction and developers and financial institutions are still waiting for a more favorable environment. Higher building and material costs are also hampering groundbreakings and we don’t foresee the cycle turning for some time. However, more rooms are under construction now than after the Great Recession—development is down but still happening.”
In September, the luxury segment had 5,911 rooms under construction, up 3.8 percent year over year; upper upscale 15,292, up 2.1 percent; upscale 33,376, up 3.6 percent; upper midscale 39,075, up 3.3 percent; midscale 12,746, up 2.4 percent and economy 4,559, up 0.7 percent.
CoStar reported that U.S. hotel rooms under construction fell year over year for the sixth consecutive month in June.
