Lodging growth is recovering from a large dip in 2009 and 2010. The latest FMI forecast calls for 14% growth in construction activity for 2015 after realizing a 24% increase in 2014. Solid growth will continue through 2016 and then slow down through 2018.
Activity to renovate and update will still be strong, even as new lodging projects begin. The greatest amount of growth will continue to be in upscale properties and event locations. Green building will also be more commonplace in remodels and retrofits.
According to Lodging Econometrics, the hotel construction pipeline surged forward to a 5-yr high in the 3rd quarter of 2014 with 3,516 projects/443,936 rooms. The pipeline has posted double-digit, year-over-year increases for four consecutive quarters in both projects and rooms. These increases signal an expansion phase of the current real-estate cycle, which is likely to continue another two to three years.
