As hotel developers increasingly shift their focus outside
the United States, U.S. hotel construction has reached its lowest level in more than a decade.
In fact, the actual number of hotel projects under
construction in the United States at the end of the third quarter, 487
properties totaling 62,041 rooms, is the lowest that research firm Lodging
Econometrics has ever recorded. Slightly more than 1,200 projects, accounting
for fewer than 130,000 rooms, are slated to begin construction in the next
year, the lowest level since 2004. As such, overall U.S. supply growth during
the next two years will be at its lowest rate since the early 1990s.
There is simply better opportunity for revenue growth
overseas, according to New York University Tisch Center divisional dean Bjorn
Hanson. "This is a long-term, permanent refocus for many lodging
companies," Hanson said. "The long-term outlook for revenue per
available room growth in the United States is 3.1 percent or less. If you look
at the rest of the world, the long-term rate of RevPAR growth is around 6
percent. If you look at India, China and parts of the Middle East, for the last
decade, it's been in the double digits."
Even though the number of rooms in the total U.S. pipeline
is more than 50 percent lower than it was in the second quarter of 2008, the
386,656 rooms from 3,221 planned hotels still represent the largest pipeline in
the world, according to Lodging Econometrics president Patrick Ford. "The
United States pipeline is very strong in proportion to everywhere else, but in
other growing economies, there are greater opportunities to do things that
weren't there before," he said. "So, people shouldn't think that the
United States is on the skids and other places are on the rise."