According to the latest China Construction Pipeline Trend Report from Lodging Econometrics (LE), China’s total hotel construction pipeline reached a new all-time high by projects for the second quarter in a row at Q4 2023. With a 6 per cent year-over-year (YOY) increase in projects and a 2 per cent YOY increase in rooms, the country’s total pipeline ended the year at 3,788 projects with 691,772 rooms.
Projects currently under construction encompass an impressive 2,644 projects/473,921 rooms, reflecting a 1 per cent increase by projects YOY. In comparison, projects scheduled to start construction in the next 12 months are up 4 per cent YOY and stand at 420 projects/74,067 rooms. Notably, projects in the early planning stage experienced a remarkable surge, achieving record-high counts in Q4. This stage witnessed a 30 per cent YOY rise in projects and a 16 per cent YOY increase in rooms to close the quarter at 724 projects/143,784 rooms. The region also saw an impressive 77 per cent YOY uptick in new project announcements (NPAs), culminating in 308 new projects/47,885 rooms at the end of Q4. These statistics collectively reflect a vibrant and expanding hotel construction landscape in China.
Upscale and upper midscale projects dominate China’s hotel construction pipeline in Q4, claiming more than 50 per cent of the total projects and rooms in the country’s pipeline, reaching unprecedented highs in project and room counts. The upscale segment increased 13 per cent YOY by projects and 7 per cent YOY by rooms to stand at 879 projects/202,831 rooms. Similarly, the upper midscale segment maintained prominence with 1,253 projects/197,122 rooms, a 12 per cent YOY increase in projects and a 7 per cent YOY increase in rooms.
Chengdu leads China’s hotel construction pipeline with the most significant number of projects in Q4, with 148 projects/29,575 rooms. Next is Shanghai with 121 projects/23,148 rooms, Guangzhou with 110 projects/22,938 rooms, Hangzhou with 96 projects/19,945 rooms, and Xi’an with 88 projects/15,565 rooms.
In 2023, China opened 683 new hotels/106,463 rooms. In the years ahead, LE analysts expect new hotel openings to continue to grow, fueled mainly by the influx of new projects into the early planning stage. Throughout 2024, LE forecasts 871 new hotels/140,116 rooms will open and 955 new hotels/161,162 rooms to open in 2025.
