Construction worker putting up drywall

PORTSMOUTH, N.H. — In the third quarter of 2022, Canada’s total construction pipeline stands at 263 projects/34,825 rooms, up two per cent by projects and rooms year-over-year (YOY), according to the recent Hotel Construction Pipeline Report for Canada by Lodging Econometrics (LE).

At the Q3 close, projects currently under construction in Canada stand at 54 projects/6,984 rooms. Projects scheduled to start construction in the next 12 months are at 105 projects/14,270 rooms, a 24-per-cent increase by projects and a 37-per-cent increase in rooms YOY. Projects in the early planning stage show a slight two-per-cent increase with 104 projects/13,571 rooms recorded.

Recently, the Bank of Canada announced another interest-rate increase to bring its policy interest rate to 3.75 per cent. Even with this additional increase, building activity remains above pre-pandemic levels as developers continue to move projects forward. In Q3, Canada had 20 new project announcements with 1,463 rooms.

Additionally, hotel renovations are up substantially YOY, with project counts three times larger than they were at this time last year. At the end of Q3 2022, renovation total stand at 48 projects/5,808 rooms and conversion totals stand at 56 projects/6,505 rooms. Combined, renovations and conversions reached a cyclical high by projects and closed the quarter at 104 projects/12,303 rooms.

Furthermore, Ontario is the most active province with 148 projects/20,396 rooms, followed by British Columbia with 47 projects/7,239 rooms and Quebec with 20 projects/2,633 rooms. Together, these provinces account 82 per cent of the total pipeline projects in Canada.

The top cities at the Q3 close are Toronto with 62 projects/9,147 rooms, Vancouver with 19 projects/2,694 rooms and Montreal with 15 projects/2,140 rooms. Together, these cities account for 37 per cent of the projects and 40 per cent of the rooms in Canada’s total pipeline.

With regard to top hotel companies, Marriott International leads the pack with 73 projects/9,977 rooms, followed by Hilton Worldwide with 64 projects/7,824 rooms and InterContinental Hotels Group (IHG) with 43 projects/4,426 rooms. These three companies make up 68 per cent of the projects and 64 per cent of the rooms in the total pipeline. The top brands include Hampton by Hilton with 25 projects/2,872 rooms, IHG’s Holiday Inn Express with 21 projects/2,257 rooms and Marriott’s Fairfield Inn with 18 projects/1,678 rooms.

Overall, Canada had 19 new hotel openings in the first three quarters of 2022, accounting for 2,015 rooms. LE’s forecast for new openings predicts another 12 hotels/1,778 rooms for the last quarter of 2022, bringing the year-end total to 31 new hotel openings with 3,793 rooms for a 1.1 per cent room-supply increase. Additionally, 2023 is forecast to see another 1.1-per-cent increase in room supply with 37 new hotels/4,036 rooms expected to open. In 2024, 42 new hotels, accounting for 4,042 rooms are expected to open.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.