According to a recent report from analysts at Lodging Econometrics, the total hotel construction pipeline in the Asia Pacific region, excluding China, remains near its high with 1,738 hotels and 367,886 rooms.
The pipeline currently has 943 hotels with 211,361 rooms under construction, and hotels scheduled to start construction in the next 12 months are at 389 hotels with 77,390 rooms. These two stages reached their peaks over the past four quarters. There are 406 hotels with 79,135 rooms in the early planning stage, which peaked much earlier in 2015.
The pipeline is expected to decline in 2019 as the present development cycle cools. Construction starts have been declining for six quarters while new hotel announcements into the pipeline have been declining for five quarters. These two metrics are the most significant for forecasting the future direction of the pipeline.
The Asia Pacific region had 274 new hotels with 48,822 rooms open at the close of the third quarter, with another 71 new hotels and 11,764 rooms expected to open in the fourth quarter, bringing the total forecast for new hotel openings to 345 by the end of 2018. The LE forecast anticipates that 388 hotels with 70,037 rooms are expected to open in 2019, and 406 hotels with 79,072 rooms in 2020, the highest levels since LE first began recording in 2007.
Who's Building Where
The list of countries with the largest pipelines in Asia Pacific, excluding China, is led by Indonesia, with 400 hotels and 67,977 rooms, which accounts for 23 percent of Asia Pacific’s total pipeline. In September, LE ranked Indonesia's pipeline as third in the world, behind only the U.S. and Canada.
Next is India with 222 hotels and 33,785 rooms, Last year, IHG and Samhi entered into a partnership to rebrand 14 hotels with approximately 2,000 rooms (operating and under construction) to the Holiday Inn Express brand across India. The first three hotels were launched in Gurgaon, Bangalore and Pune in the autumn.
Japan comes next with 203 hotels and 41,816 rooms. Earlier this year, Okura Nikko Hotel Management signed a deal with Meieki Management to manage the Nikko Style Nagoya opening in 2020, and IHG announced plans for the Kimpton Tokyo Shinjuku to open the same year.
These countries are followed by Thailand with 143 hotels and 33,855 rooms. Since September, Mandarin Oriental has announced plans for a 105-guestroom resort on Phuket's west coast for 2022, Best Western revealed plans to bring its BW Premier Collection to the same city in 2020 and Radisson announced that it would bring its Park Inn brand to Phuket Town in the same year.
Malaysia, meanwhile, has 132 hotels and 34,853 rooms in its pipeline. Last week, Spanish hotel group Meliá Hotels International signed a deal to open the Innside Kuala Lumpur Cheras, part of an integrated development project in the country's capital. The week before, Hyatt Hotels Corporation and property developer UEM Sunrise Berhad opened the Hyatt House Kuala Lumpur, Mont'Kiara, marking the brand's entry into the extended-stay hotel segment in Malaysia and the Southeast Asia region.
Asia Pacific cities with the largest construction pipelines are led by Jakarta, Indonesia, with 99 hotels/18,820 rooms. Next is Seoul, South Korea, with 74 hotels and 13,730 rooms and Tokyo with 62 hotels and 15,572 rooms. Bangkok follows with 50 hotels and 11,662 rooms and then Kuala Lumpur, Malaysia with 49 hotels and 12,929 rooms.
Top Companies, Top Brands
The top franchise companies, accounting for 40 percent of guestrooms in the total construction pipeline, are AccorHotels with 248 hotels and 53,196 rooms, Marriott International with 198 hotels and 45,870 rooms, and InterContinental Hotels Group, which set a new record high for the company, with 148 hotels and 33,177 rooms. Hilton follows with 85 hotels and 18,978 rooms.
Top brands in Asia Pacific’s construction pipeline, excluding China, include AccorHotels’ Ibis brand with 62 hotels and 12,440 rooms and Novotel with 48 hotels and 10,807 rooms. Marriott International’s Courtyard has 33 hotels with 6,697 rooms, and the full-service Marriott Hotels has 24 hotels with 6,533 rooms. IHG’s Holiday Inn has 57 hotels with 13,715 rooms and Holiday Inn Express has 34 hotels with 6,838 rooms, while Hilton’s DoubleTree has 30 hotels with 6,368 rooms and the full-service Hilton Hotel & Resort brand has 27 hotels with 6,919 rooms. Both the full-service Marriott Hotels and the full-service Hilton Hotel & Resorts brand are at record highs for their respective companies.