Dive Brief:
- The total U.S. hotel construction pipeline stood at 6,020 projects, or 705,825 rooms, in the first quarter of 2026, according to Lodging Econometrics’ Q1 2026 U.S. Construction Pipeline Trend Report. Both project and room counts were down roughly 5% compared to Q1 2025.
- Despite the decline, the luxury segment reached a record-high project count of 102 hotels in the quarter, up 16% year over year, per Lodging Econometrics. Hotel conversions also maintained a steady pipeline of 1,461 projects, up 3% year over year.
- Dallas led all other U.S. markets with the largest hotel construction pipeline in Q1, totaling 184 projects, or 22,861 rooms, the report detailed. Phoenix, meanwhile, is forecast to have the most hotel openings in 2026.
Dive Insight:
In the first quarter, the number of hotel projects under construction (1,071) decreased roughly 7% year over year. The number of hotel projects scheduled to start construction in the next 12 months (2,164) as well as those in the early planning stage (2,785) also declined compared to Q1 2025.
The pipeline shrunk year over year in part due to many projects finishing and opening ahead of major upcoming events, including the FIFA World Cup, Bruce Ford, senior vice president and director of global business development at Lodging Econometrics, told Hotel Dive.
Additionally, due to the cost of debt in 2025, it was not feasible for many hotel players to sign new project agreements, Ford said. Growing financial pressures led a significant portion of hoteliers to delay or cancel development and renovation projects last year, a September report from the American Hotel & Lodging Association found. Debt markets, however, are expected to improve throughout 2026, according to a February JLL report.
Still, hotel players who have the capital are spending it, Ford said, pointing to the growing luxury pipeline. Several hotel companies have notable luxury projects underway across the U.S., including Marriott International and Hilton.
The upscale, upper midscale and midscale chain scales accounted for 75% of the projects in the total U.S. construction pipeline in the first quarter of this year, per the report.
While Dallas had the largest total hotel construction pipeline in the quarter, its projects pipeline was down roughly 9% year over year. Atlanta followed Dallas for the largest pipeline, with 158 projects, or 17,524 rooms. Phoenix, Nashville and Austin, Texas, rounded out the top five.
The markets with the greatest number of projects presently under construction in Q1 were Dallas at 37, Phoenix at 36 and New York at 26. Phoenix saw “particularly strong momentum,” with its number of projects under construction, up 19% year over year in Q1, according to Lodging Econometrics. Phoenix also had the most new project announcements (nine) in the quarter.
Phoenix is slated to have the most hotel openings (27) of any other U.S. market this year, followed by New York (21) and Dallas (20), according to Lodging Econometrics.
The organization forecasts that a total of 682 new hotels with 77,323 rooms will open across the U.S. in 2026, representing a 1.4% year-over-year increase in new hotel supply.
