The upscale segment accounts for the largest portion of guestrooms in the total active pipeline in Asia Pacific, according to the latest STR Global Construction Pipeline Report.
Of the 262,662 guestrooms under development in Asia Pacific, 25% are in the upscale segment, with 23.3% in upper-upscale and 18.5% in luxury. The midscale without food and beverage and the economy segments combine to make up just 6% of the active pipeline in Asia Pacific. In all there are 1,064 projects in various stages of development across the region.
The concentration of projects in the upscale segment and higher signifies the strong focus across the region to bring the higher-end hotel brands into the main markets before diversifying into a broader offering in more secondary locations,” says Elizabeth Randall, managing director of STR Global.
Total development activity is less in Europe, where the hotel project pipeline comprises 718 hotels totaling 120,251 guestrooms. The majority of guestrooms under construction are in the United Kingdom, followed by Russia, Germany, Turkey and Sweden, respectively. “The 2012 Olympic Games have fuelled the construction activities in London, where 38% of rooms under construction in the UK are located,” Randall says.
Development activity has picked up somewhat in the Caribbean and Mexico since a year ago, STR reports. The hotel development pipeline in that region comprises 128 hotels totaling 18,802 guestrooms. In 2010, 32 projects opened in the region, with 3,791 guestrooms. This year, 58 projects are expected to open, with 7,590 guestrooms. The midscale without food and beverage segment is expected to open the largest number of projects—22 hotels with 2,389 guestrooms—and those figures are expected to more than double in 2012, to 50 and 7,815.
Panama City is leading the development pipeline in Central and South America, with the Panama capital set to up its total guestroom inventory by more than 50% during the next three years. "It represents the biggest increase compared to the existing supply of all the major markets in Central and South America,” Randall says. “The economic strength and outlook for the market has continued to attract development." With 4,734 guestrooms in the pipeline, Panama City boasts about 21% of the region’s entire pipeline activity, according to STR Global.
In the Middle East, Dubai again claims the top spot for hotel pipeline activity, with 27,102 guestrooms in various stages of development. Abu Dhabi follows with 13,239 guestrooms. Three other Middle East markets have at least 1,500 guestrooms in the pipeline: Cairo (3,275), Jeddah (3,033) and Muscat (1,831). The region has a total pipeline of 430 hotels and 116,152 guestrooms.