Billions in new hotel development still off historical levels1 May, 2013 By: David Eisen
A new analysis by STR Analytics has revealed something of a surprise: while $10 billion in new hotels opened in the U.S. last year, these developments were near their lowest levels ever reported.
In STR's newly released Hotel Development Almanac, it makes the case that a lack of funding is the reason for the decrease in new developments, with just 420 hotels being opened in 2012.
"With a limited amount of financing available for new developments, the volume of new rooms entering the market is negligible in most cities," STR Analytics Director Steve Hennis said. "However, with continued improvement in both the general hotel industry as well as the national economy, we are beginning to see the pace of new construction increase."
According to the report, Hampton Inn & Suites and Holiday Inn Express had the most hotel openings in 2012, while the most active market for development last year was North Dakota, with 23 new hotels opened. This undoubtely is due to the need for more lower-end lodging options to accommodate the influx of workers coming to the area to work the oil and natural gas production.
Not surprising, New York City was the most expensive area for development in 2012 and the majority of properties opened last year were upscale and upper-midscale hotels.
More than 600 new hotels are scheduled to be opened throughout the U.S. in 2013, Hennis noted.
External Source : Star Tribune
Reproduction in whole or part is prohibited.