Home / World Tourism / Canada’s construction pipeline projects are at a cyclical high

Canada’s construction pipeline projects are at a cyclical high


PORTSMOUTH, NH – Analysts at Lodging Econometrics (LE) report that in the third quarter of 2018 the total construction pipeline in Canada stands at 247 projects/29,954 rooms. Construction pipeline projects are at a cyclical high with an increase of 19 projects year-over-year (YOY).

Indications are that the pipeline is in a topping-out period. Total guest rooms in the pipeline appear to have peaked in the 3rd and 4th quarters of 2017, signaling the onset of further pipeline declines ahead. Other pipeline metrics that signal a possible decline are rooms under construction, rooms scheduled to start construction in the next 12 months, and new project announcements into the pipeline which have all been decreasing since fall of 2017.

Projects presently under construction are at 89 projects/10,781 rooms, of which 40 projects/4,283 rooms began construction in the first three quarters of 2018. Projects scheduled to start construction in the next 12 months are at 85 projects/9,893 rooms, a minimal 2% decline in project counts. Projects in the early planning stage show a 20% increase with 73 projects/9,280 rooms recorded. With the Bank of Canada expected to increase interest rates again in January, developers continue to hurry projects from their drawing board into the permitting and early planning phase.

In the first three quarters of 2018, Canada had 36 new hotel openings. LE’s forecast for new hotel openings predicts another 10 hotels will open in the last quarter of 2018, bringing the total to 46 new hotel openings. 2019 is forecast to see 54 projects/6,220 rooms open, and 2020 anticipates that 63 projects/6,873 rooms will open and come online as new supply, which should be the high for this cycle.

Marriott International leads the top hotel companies in Canada’s construction pipeline with 51 projects/7,176 rooms, followed by the InterContinental Hotel Group (IHG) with 45 projects/4,359 rooms, and Hilton Worldwide with 42 projects/5,157 rooms. These three companies make up 56% of the total construction pipeline.

The top brands in the pipeline are IHG’s Holiday Inn Express with 28 projects/2,839 rooms, Hilton’s Hampton Inn & Suites by Hilton with 18 projects/2,161 rooms, Marriott’s Courtyard with 10 projects/1,509 rooms and TownePlace Suites with 10 projects/995 rooms, and Hyatt Hotel’s Hyatt Place with 9 projects/ 1,266 rooms.

Markets with the most projects in the pipeline are Toronto with 40 projects/5,250 rooms, Calgary with 15 projects/2,225 rooms, Edmonton with 13 projects/1,948 rooms, Ottawa with 11 projects/ 1,909 rooms, and Vancouver with 11 projects/ 1,290 rooms.


You can read more of the news on source