PORTSMOUTH, NH— New supply growth in the nation’s 25 largest markets will fall to 127 hotels or 16,278 rooms in 2004, down from 147 hotels or 26,227 rooms in 2003, representing a 42% year-over-year room count decline, revealed Lodging Econometrics’ 3Q 2004 Lodging Development and Trends Report. Lodging Econometrics President Patrick Ford said 2004 marks the sixth consecutive annual decline from the peak reached in 1998, when 474 new hotels with 57,994 rooms were added, and that the average size of a new hotel opening fell significantly from 178 rooms in 2003 to 128 in 2004. This reduction in average room size underscores that large hotel development has almost completely waned in CBD locations and that developers are now focusing on much smaller properties in outer suburban and highway locations. Lodging Econometrics forecasts supply side growth in 2005 for the top 25 markets to increase slightly to 139 hotels or 17,049 rooms. Its newly released forecast for 2006 calls for an additional slight increase to 151 hotels or 20,105 rooms.
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