Latin America Hotel Pipeline Declines in Q3 2020

hotel Construction Pipeline - October 2019

Analysts at Lodging Econometrics (LE) this week released their Q3 2020 Latin America Hotel Construction Pipeline Trend Report. Latin America’s total construction pipeline stands at 671 projects/116,731 rooms, down 7 percent by projects and 11 percent by rooms year-over-year (YOY).

The number of projects presently under construction stands at 344 projects/61,159 rooms, up 3 percent by projects and 1 percent by rooms YOY. Projects scheduled to start construction in the next 12 months are at 186 projects/34,551 rooms. Projects in the early planning stage have experienced the sharpest decline, down 23 percent by projects and 40 percent by rooms YOY, settling in at 141 projects/21,021 rooms at the close of Q3 2020.

Through the third quarter of 2020, 45 new hotels/8,608 rooms opened in Latin America. There were 29 new project announcements—a cyclical low project count for the region—accounting for 4,557 rooms. Construction starts are also the lowest they’ve been in this real estate cycle with Latin America only beginning 21 projects having 3,667 rooms.

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Five countries in Latin America’s construction pipeline account for 68 percent of the projects in the region. This is led by Mexico with 221 projects/39,886 rooms. Brazil follows with 129 projects/19,604 rooms. Next is Peru with 43 projects/5,719 rooms, then the Dominican Republic with 32 projects/6,488 rooms, and Cuba stands at 29 projects/8,243 rooms.

Cities in Latin America with the largest pipelines include Lima, Peru with 32 projects/4,651 rooms; Mexico City, Mexico with 26 projects/4,004 rooms; Guadalajara, Mexico with 21 projects/2,777 rooms; Cancun, Mexico with 20 projects/10,009 rooms; and Sao Paulo, Brazil with 16 projects/2,671 rooms.

Hotel franchise companies with the largest construction pipelines in Latin America are Marriott International with 115 projects/19,799 rooms, Accor with 99 projects/12,936 rooms, Hilton at a record-high 97 projects/13,802 rooms, and InterContinental Hotels Group (IHG) with 57 projects/6,935 rooms. These four companies account for 55 percent of the projects in the total Latin America construction pipeline.

Leading brands in the pipeline are Accor’s Ibis brands with 68 projects/8,650 rooms, Hilton Garden Inn recording an all-time high of 27 projects/3,659 rooms, and Hampton by Hilton with 25 projects/2,985 rooms, also at record counts. These are followed by IHG’s Holiday Inn Express with 15 projects/1,850 rooms and Marriott’s Fairfield Inn with 14 projects/2,081 rooms.


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