Canada’s hotel development pipeline surges
The latest data from Lodging Econometrics (LE) for the third quarter of 2024 highlights an unprecedented expansion in Canada's hotel development pipeline, signalling a robust phase of growth within the sector.
With a total of 327 projects encompassing 40,799 rooms, the pipeline has reached historic highs, reflecting a year-over-year increase of 19% in projects and 8% in room count.
This surge underscores strong confidence among developers amid a competitive market landscape.
Current under-construction activity is notably robust, with 81 active projects comprising 10,596 rooms—marking a staggering 45% increase in projects and a 29% rise in room numbers compared to the previous year.
The early planning phase is witnessing the most dramatic growth, boasting 177 projects and 20,435 rooms. "The 50% increase in project count relative to a more modest 14% rise in room numbers suggests a trend towards smaller-scale developments," said a spokesperson from LE.
The pipeline also includes another 69 projects scheduled to commence construction within the next 12 months, further cementing a strong trajectory for the sector.
By chain scale, upper midscale hotels are leading the charge, with record figures showing 135 projects and 14,219 rooms—accounting for 41% of total projects and 35% of room supply.
The upscale segment follows with 56 projects and 7,748 rooms, while midscale and upper upscale sectors also set new records with 43 projects (3,718 rooms) and 22 projects (5,066 rooms), respectively, as of Q3 2024.
Ontario remains the dominant province in hotel construction, representing 59% of projects and 61% of rooms across Canada. This province has achieved record counts with 193 projects and 24,697 rooms.
British Columbia ranks second with 60 projects and 8,420 rooms, while Quebec has 22 projects and 2,547 rooms, followed by Alberta with 16 projects and 1,647 rooms.
Toronto leads the cities with a staggering 67 projects, encompassing 9,468 rooms, which accounts for 23% of the total room count in Canada’s construction pipeline.
Vancouver follows with 22 projects and 3,921 rooms, while Niagara Falls, Montreal, and Ottawa-Hull round out the top five cities, each reporting significant project counts.
In the first three quarters of 2024, Canada welcomed nine new hotels, adding 1,004 rooms to the existing supply of operational hotels.
Looking ahead, LE forecasts the opening of another 12 hotels, contributing 1,359 rooms by year-end, which would bring the total to 21 new hotels and 2,363 rooms for the year.
Story Continues
Projections for 2025 anticipate the launch of 35 hotels with an additional 3,875 rooms, translating to a 1.1% increase in overall supply. For 2026, the forecast suggests 44 new hotels adding 5,079 rooms, which would mark a 1.4% increase in supply.
The data from Lodging Econometrics paints a promising picture for Canada's hotel industry, with substantial growth and development on the horizon, reflecting a strong belief in the sector's future resilience and adaptability.
"Canada’s hotel development pipeline surges" was originally created and published by Hotel Management Network, a GlobalData owned brand.
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