According to analysts at Lodging Econometrics (LE), the total China construction pipeline stands at 3,454 projects/661,043 rooms. At the end of the second quarter, the 2021 construction pipeline is up 2% by rooms year-over-year (YOY) and just below the region’s all-time high project count of 3,574 projects/647,704 rooms set in the second quarter of 2020. This is the fourth consecutive quarter China’s pipeline has increased.
China currently has 2,401 projects/437,731 rooms under construction, up 5% by projects and 7% by rooms YOY, while projects scheduled to start construction in the next 12 months are down 6% by projects and 11% by rooms, standing at 556 projects/103,958 rooms. Projects in the early planning stage are at an all-time high, up 10% by projects and 12% by rooms YOY and standing at 497 projects/119,354 rooms at the end of Q2. The increases in projects in the under construction and early planning stages can be attributed to a record number of new upper upscale, upscale, and upper midscale projects recorded during Q2'21. According to LE's market intelligence team, previously delayed projects that have been on hold over the past year, due to COVID-19, are now advancing and expected to increase over the next few quarters as construction in China resumes.
Chengdu leads China's pipeline at the end of Q2'21 with 138 projects, a record-high number of projects, having 28,009 rooms. Shanghai follows with 123 projects/23,891 rooms. Next is Guangzhou, standing at 121 projects/24,836 rooms, then Wuhan with 101 projects/14,064 rooms, and Xi'an with 93 projects/16,395 rooms.
The three top franchise companies in China’s construction pipeline reached record highs during the second quarter. Hilton Worldwide hit a record-high of 634 projects as well as a record-high count of 120,697 rooms; InterContinental Hotels Group (IHG) also reached a record-high of 444 projects, accounting for 92,342 rooms; and Marriott International saw an all-time high of 394 projects/105,961 rooms. Next is JinJiang Holdings, with 218 projects/21,394 rooms, and Accor with 183 projects/32,839 rooms. These five companies make up an impressive 54% of projects and 56% of rooms in China’s total hotel construction pipeline.
The leading brands in the construction pipeline for these companies are Hilton’s Hampton by Hilton with a record-high of 362 projects/55,084 rooms; IHG’s Holiday Inn Express also reached record-high counts this quarter with 209 projects/34,788 rooms; JinJiang’s 7 Days Inn brand with 102 projects/8,031 rooms; Accor’s Ibis brands with 66 projects/6,976 rooms; Marriott International’s Marriott Hotel brand closed the quarter with 63 projects/19,130 rooms.
China’s new hotel openings in the first half of 2021 were 221 hotels/37,227 rooms, with a record low of 82 projects/15,507 rooms opening during the second quarter. The LE forecast for new hotel openings expects another 622 projects/90,586 rooms to open in the second half of 2021, bringing expected new hotel openings to 843 projects/127,813 rooms by year-end. In the years following, 984 new hotel openings with 158,810 rooms are expected in 2022 and 735 projects/147,278 rooms in 2023.
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