China’s hotel construction pipeline reached a new milestone in the third quarter of 2024, largely driven by developments in the upscale and upper midscale market segments, as reported by Lodging Lodging Econometrics (LE), in its latest China Hotel Construction Pipeline Trend Report, revealed the findings. The total pipeline comprises 3,853 projects and 703,312 rooms, marking an annual increase of 4% in project numbers and 3% in room count.
By the end of Q3, there were 2,793 projects with 505,106 rooms under active construction, reflecting a cyclical high with a 5% year-over-year increase. For projects anticipated to begin within the next 12 months, there were 348 projects and 60,095 rooms, showing a slight 2% decrease in projects and an 8% drop in rooms compared to the previous year. Early planning phases saw a modest 1% growth, with 712 projects and 138,111 rooms.
The upscale and upper midscale categories have driven this quarterly growth. The upscale segment ended Q3 with 1,026 projects and 224,688 rooms, reflecting a 14% rise in project volume and a 9% increase in room capacity from last year. Similarly, the upper midscale segment reported a 7% rise in projects and a 4% increase in rooms, totaling 1,230 projects and 188,280 rooms. These two segments make up 59% of all hotel construction projects and room capacity in China’s pipeline.
Additionally, China saw a 12% increase in brand conversion projects and a 20% boost in rooms, totaling 174 hotels and 29,893 rooms. The quarter also saw an 8% rise in project starts and a 10% increase in rooms, closing Q3 with 241 projects and 39,138 rooms.
The cities at the forefront of construction activity were Chengdu, hosting 152 projects with 27,424 rooms; Shanghai, with 132 projects totaling 25,081 rooms; Guangzhou, which had 127 projects and 25,763rooms. Hangzhou is set to see 103 projects with a total of 20,356 rooms, while Xi’an is anticipated to have 91 projects offering 16,303 rooms.
Lodging Econometrics noted that 662 new hotels with 91,463 rooms had opened across China through the end of Q3 2024. An additional 326 hotels with 53,654 rooms are projected to open in Q4, bringing the year-end total to 988 new hotels with 145,117 rooms. In 2025, an estimated 1,101 new hotels with a total of 176,140 rooms are anticipated to open, with another 799 hotels providing 150,069 rooms projected for 2026.
