Dive Brief:
- Ahead of the Hospitality Industry Technology Exposition and Conference (HITEC) being held in Charlotte, North Carolina, next week, Lodging Econometrics released first-quarter 2024 hotel development data on the market, spotlighting trends that track with the total U.S. hotel construction pipeline.
- With 67 hotel projects, or 7,772 rooms, in its Q1 construction pipeline, Charlotte ranked fifteenth among the top 25 U.S. markets for the largest hotel construction pipeline by project count, according to the Lodging Econometrics report.
- Charlotte “stands out for its conversion activity,” according to Lodging Econometrics, noting that a significant portion of the market’s pipeline comprised conversion hotels in Q1. Other top 25 U.S. markets have similarly seen heightened conversion activity so far this year.
Dive Insight:
Charlotte has seen strong hotel development activity in recent months, with 11 projects, or 1,435 rooms, under construction at the close of Q1, according to Lodging Econometrics.
Roughly 25% of projects in Charlotte’s hotel construction pipeline in Q1 were for renovation and conversion projects. The market ranked ninth in the U.S. by project volume for conversions, according to Lodging Econometrics.
Charlotte followed Los Angeles, which led all other U.S. markets for renovation and conversion projects in the pipeline in Q1, as well as New York, Atlanta and Chicago.
At the beginning of the year, Lodging Econometrics SVP Bruce Ford forecasted that heightened conversion activity would continue through 2024. As a fast and affordable way to grow portfolio scale in a tight lending environment, hotel conversions have seen strong demand in recent months. Choice Hotels International, Marriott International and other hotel companies have expanded in the space.
Also in Q1, Charlotte had 31 projects, or 3,466 rooms, scheduled to start construction in the next 12 months and 25 projects, or 2,871 rooms, in early planning stages.
More than 65% of the hotel projects in Charlotte are for upscale and upper midscale brands, Lodging Econometrics found. Combined, the two segments account for 44 projects, or 5,007 rooms, in the market’s construction pipeline.
Looking ahead, Lodging Econometrics forecasts Charlotte will see 1.2% supply growth by rooms in 2024, with five projects, or 511 rooms, opening this year.
After being hosted in Toronto in 2023, HITEC is back in the U.S. this year after being hosted in Toronto in 2023. The conference will be held at the Charlotte Convention Center in the market’s city center.
