According to the latest Latin America Construction Pipeline Trend Report by Lodging Econometrics, the region’s hotel construction sector is reporting “robust growth.”
At the close of Q1 2024, the total hotel construction pipeline in Latin America stands at 604 projects and 100,990 rooms, an 11 percent increase in projects and a 12 percent increase in rooms year over year.
At the end of the first quarter, there are 249 hotels and 47,393 rooms under construction in Latin America, reflecting a 10 percent year-over-year increase by projects and an 18 percent increase by rooms. Additionally, projects scheduled to start construction in the next 12 months stand at 189 hotels and 28,740 rooms, up 18 percent by projects year over year and 11 percent by rooms, while those in early planning stand at 166 hotels and 24,857 rooms, up 4 percent by projects year over year and 3 percent by rooms.
Noteworthy chain scale segments in Latin America at the Q1 close include the upscale segment with 129 hotels and 18,314 rooms and the luxury chain scale, which reached record project counts of 106 projects with 22,051 rooms at the close. The upper upscale chain scale closed the quarter with 103 hotels and 21,403 rooms, down slightly from the peak of this chain scale, which was reached in Q4 2023.
Top Markets
Countries in Latin America with the largest number of projects in the pipeline at Q1 are Mexico with 226 hotels and 35,691 rooms, Brazil with 91 hotels and 13,670 rooms, and the Dominican Republic with record-high counts of 51 hotels and 13,118 rooms. These three countries account for 61 percent of the projects in the total pipeline and 62 percent of the rooms.
Key cities in Latin America with the largest construction pipelines include Mexico City with 21 hotels and 2,353 rooms; Georgetown, Guyana, with 13 hotels and 1,689 rooms; and Lima, Peru, with 12 hotels and 1,914 rooms. Riviera Maya, Mexico, follows also with 12 projects accounting for 1,421 rooms, and São Paulo, Brazil, with 11 hotels and 2,438 rooms.
Renovation and conversion activity remains strong in Latin America at the end of Q1 2024, accounting for 146 hotels and 29,191 rooms. Year over year, this represents an increase of 13 percent by projects and 33 percent by rooms. Upper midscale hotels lead the renovation and conversion activity in the region.
The first quarter of 2024 had 20 new hotels with 3,330 rooms open throughout Latin America. Moreover, new project announcements showed significant year-over-year growth with 23 more NPA projects in the pipeline at Q1 2024 compared to Q1 2023 NPA totals. The LE new hotel openings forecast for the remainder of the year expects an additional 81 new hotels with 15,051 rooms to open by year-end. Looking ahead, LE analysts expect new hotel openings in Latin America to increase slightly in 2025 with 108 new hotels and 18,744 rooms forecast to open.