Hotel Online  Special Report




New U.S. Hotel Construction Increased by 64% in 2006, 
Highest Room Starts Increase Since 1994

NEW YORK, June 6, 2007 – PricewaterhouseCoopers' research, supplemented by Torto Wheaton Research data, shows that approximately 136,500 rooms began construction in 2006, a year-over-year increase of 64.2 percent, making the 2006 room starts increase the highest since 1994, when the new hotel construction increased by 67.2 percent. 

The room starts increase of 2006 reflects positive industry fundamentals including the largest revenue per available room (RevPAR) growth since 1981 of 8.5 percent in 2005 and a robust growth of 7.7 percent in 2006. PwC forecasts a 5.6 percent RevPAR growth in 2007 as supply growth slightly exceeds demand growth and average daily rate (ADR) growth slows. 

As a result, PricewaterhouseCoopers forecasts supply growth of 1.6 percent in 2007 and 2.3 percent in 2008, the highest two year levels since 2001. 

The following graph illustrates the number of new hotel room constructions starts since 1988. 

New Hotel Room Construction Starts - 1988 to 2006 

Source: Torto Wheaton Research, F. W. Dodge data 

In December 2005, PricewaterhouseCoopers forecasted a non-consensus 59.2 percent increase in new hotel construction in 2006, the largest since 1994, as hotel projects put on hold in 2001 were reinstated and developers were expected to respond to record-setting room rate and RevPAR gains. The construction slowdown in 2005 also reflected the increased construction costs, including construction materials and labor as well as cancellations or delays for projects in the South, Southeast and Gulf regions due to damage and planning issues from the hurricanes in 2005. 

About PricewaterhouseCoopers 
PricewaterhouseCoopers ( provides industry-focused assurance, tax and advisory services to build public trust and enhance value for its clients and their stakeholders.  More than 140,000 people in 149 countries across our network share their thinking, experience and solutions to develop fresh perspectives and practical advice. 




Also See: Number of New U.S. Hotel Brand Launches in 2005/2006 Reflects Largest Two-Year Total in 17 Years, PricewaterhouseCoopers Reports / March 2007

Value Received by Hotel Customers in Past Decade Has Averaged 86% at Full-service Hotels and 72% at Limited-service Hotels / April 2007



To search Hotel Online data base of News and Trends Go to Hotel.OnlineSearch
Home | Welcome| Hospitality News | Classifieds| One-on-One |
Viewpoint Forum | Industry Resources
Please contact Hotel.Onlinewith your comments and suggestions.