NEW YORK Recent analysis of the upscale segment of hotels in the top 50 markets performed by Lodging Econometrics showed a 20% decline in hotel rooms under development.
Both Marriott and Starwood have experienced market share increases for their hotel rooms in the development pipeline. As overall supply growth slows benefiting all hotel companies, Marriott, Starwood and Hilton are increasingly better positioned to compete as they either increased (Marriott and Starwood) or maintained (Hilton) their market share of rooms under development, according to the analysis.
The report states that hotels and rooms under development in the upscale segment declined 14.7% and 20%, respectively, with a falloff in projects in all categories under construction, in permitting, and early planning. Furthermore, the entire lodging industry pipeline has declined 7.6% over the past three months, said the report. The decline in early planning hotel rooms will likely lower future hotel openings into 2003.
Finally, the report indicated that Marriott s market share of the development pipeline has increased significantly. The overall upscale market scaled back its development pipeline by 20%, but Marriott s share of future development accelerated, as it cut its development plans by only 9.6%. Hilton is Marriott s closest competitor with regard to market share, but only holds 17.9% of the market in comparison to Marriott s 30.1%, according to the report. (5/21/01)