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THE NUMBER OF U.S. hotel rooms under construction in June reached its highest level in 16 months, according to CoStar. The construction volume increased year-over-year for four consecutive months, with upscale and upper midscale segments dominating pipeline activity. "The number of rooms in construction has grown year-over-year for four consecutive months," said Isaac Collazo, STR's vice president, analytics. "While upscale and upper midscale continue to dominate, accounting for about 50 percent of all rooms in the final phase of the pipeline, the pace of activity in these segments has slowed compared to last year. Midscale and economy have shown the most growth, up 42 percent and 34 percent, respectively, with newer brands and extended-stay accounting for most of the new construction across the midscale segment." Approximately 157,713 rooms were under construction in June, up 5.5 percent from the same month last year. Additionally, 266,619 rooms were in the final planning phase, a 9.8 percent increase from June 2023. The planning stage saw 333,827 rooms, a rise of 38.7 percent compared to the previous year.

U.S. EXTENDED-STAY HOTEL occupancy declined across 59 MSAs in 2023 compared to 2019, primarily due to significant ADR growth over the past three years, according to The Highland Group. Additionally, extended-stay hotel RevPAR surged in more than 80 percent of MSAs, with ten of them, including four major hotel markets, experiencing gains exceeding 10 percent. Despite an 8 percent increase in the number of extended-stay hotel rooms under construction in the 100 largest MSAs over the past year, the figures remain below pre-pandemic levels, the report said. The resurgence in occupancy was notably led by smaller markets, where strong ADR increases and supply expansion played pivotal roles in driving the lowest occupancy recovery indices for MSAs in 2023.