According to Lodging Econometrics' year-end report for 2018, Europe’s total construction pipeline jumped to 1,569 hotels with 243,947 rooms, a 19-percent increase year-over-year and the highest hotel and room counts ever recorded. The record counts come despite concerns of slower growth throughout the region, shrinking demand for the region’s exports, Brexit uncertainties and political tensions in many countries.
There are 784 hotels with 124,674 rooms currently under construction, 434 hotels with 68,128 rooms planning to start construction in the next 12 months and 351 hotels with 51,145 rooms in the early planning stage. The total pipeline and all three stages of the pipeline have counts more than double their cyclical lows set earlier in the decade.
Announced renovation and conversion counts also are booming with 400 hotels and 55,787 rooms, up 16 percent by hotels (a record high) and up 21 percent by rooms year-over-year.
In 2018, 386 new hotels with 53,236 rooms opened throughout Europe, the highest number of new hotel openings ever recorded. Because of the robust construction pipeline, the Lodging Econometrics forecast for new hotel openings will continue to be strong with 382 new hotels and 53,252 rooms anticipated in 2019 and 386 new hotels with 59,861 rooms in 2020.
Franchise companies with the largest construction pipelines are Accor with 257 hotels and 34,606 rooms and Marriott International with 215 hotels and 35,789 rooms. Next is Hilton with 173 hotels and 26,684 rooms and IHG with 147 hotels and 24,861 rooms. These four companies are responsible for 50 percent of the hotels and rooms in the total pipeline. Accor, Marriott and IHG set new record project counts in their European pipelines.
The leading brands for each of these top companies are Accor’s Ibis brands with 138 hotels and 17,369 rooms, Novotel with 26 hotels and 4,426 rooms, Adagio City Aparthotel with 25 hotels and 3,236 rooms and Mercure Hotel with 25 hotels and 2,656 rooms. Marriott International’s top brands are Moxy with 69 hotels and 12,479 rooms, Courtyard by Marriott with 33 hotels and 5,788 rooms and the Autograph Collection with 17 hotels and 2,324 rooms. Hilton has Hampton Inn with 67 hotels and 10,309 rooms, Hilton Garden Inn with 47 hotels and 6,960 rooms and DoubleTree by Hilton with 25 hotels and 3,371 rooms. IHG’s include Holiday Inn Express with 74 hotels and 11,176 rooms, Holiday Inn with 34 hotels and 7,887 rooms, and Hotel Indigo with 14 hotels and 1,780 rooms.
Many brands have hit all-time records at year-end, including Novotel, Adagio City Aparthotel, Moxy, Courtyard, the Autograph Collection, DoubleTree and Holiday Inn Express.
Europe’s leading countries in the construction pipeline are Germany with 283 hotels and 52,569 rooms, the United Kingdom with 266 hotels and 38,590 rooms, France with 167 hotels and 20,479 rooms, Poland with 97 hotels and 14,958 rooms, and Portugal with 96 hotels and 10,206 rooms. With the exception of the United Kingdom, these markets all have construction pipelines at record highs.
The cities with the largest pipelines are London with 80 hotels and 13,516 rooms; Paris with 54 hotels and 8,093 rooms; Dusseldorf, Germany, with 50 hotels and 10,032 rooms; Istanbul with 31 hotels and 5,566 rooms; and Lisbon, Portugal, with 30 hotels and 2,911 rooms. Frankfurt, Germany, follows with 29 hotels and 5,694 rooms; Warsaw, Poland, with 29 hotels and 5,390 rooms; and Moscow with 28 hotels and 5,881 rooms. Warsaw, Dusseldorf, and Budapest, Hungary, have pipelines greater than 20 percent of their current census, indicating the possibility of absorption problems should economic growth trends soften further.