Europe's Hotel Construction Pipeline Shows Slight Year-over-year Increases in Project Counts at Q3 2023

In the Q3 2023 Hotel Construction Pipeline Trend Report by Lodging Econometrics (LE), analysts state that Europe's total construction pipeline currently stands at 1,673 projects/249,264 rooms, up 1% by projects year-over-year (YOY).

The luxury, upper upscale, upscale, and economy chain scales in Europe all show YOY increases in project counts compared to Q3 2022 totals. Luxury projects increased 2% YOY, just ten projects short of the segment's all-time high, closing the quarter with 139 projects/18,515 rooms. The upper upscale chain scale increased 3% by projects YOY, with 284 projects/46,717 rooms. Upscale projects in Europe are up 3% YOY and account for 26% of projects in the country's total construction pipeline, settling in at 439 projects/71,178 rooms. Economy projects grew 5% YOY to stand at 157 projects/20,042 rooms at the close of the quarter.

At the end of the third quarter of 2023, there are 759 projects/114,842 rooms under construction. Projects scheduled to start construction in the next 12 months stand at 411 projects/63,154 rooms, while projects in early planning stand at 503 projects/71,268 rooms. Brand conversions in the region are up 15% by projects YOY, to stand at 374 projects/49,893 rooms. Construction starts grew 17% by projects YOY, with 91 hotels/11,436 rooms, and new project announcements (NPAs) also increased at Q3 by 20% YOY by projects, to close the quarter at 107 projects/13,536 rooms.

The United Kingdom continues to have the largest number of projects in the region's total pipeline at Q3, with 322 projects/44,259 rooms. Germany follows with 201 projects/32,889 rooms, then Portugal with 125 projects/15,055 rooms, and France with 121 projects/13,613 rooms. Next is Turkey, reaching all-time highs of 114 projects/16,907 rooms and increasing 33% by projects YOY.

Through the third quarter, 241 new hotels, accounting for 32,191 rooms, opened in Europe. The LE forecast for new hotel openings anticipates 99 additional new hotels/13,519 rooms to open by year-end. LE analysts expect new hotel openings will continue to ascend in the coming years, with 356 hotels/48,888 rooms scheduled to open in 2024 and climbing even higher to 406 hotels/56,127 rooms expected to open in 2025.