There are 879 projects/140,620 rooms currently under construction, 531 projects/81,235 rooms scheduled to start construction in the next 12 months, and 461 projects/75,635 rooms in early planning. All stages of the pipeline are at record highs and have counts more than double their cyclical lows set earlier in the decade.
However, Europe closed 2019 with a fragile and waning economy with growth in the Eurozone expanding by a mere 0,1 percent in the fourth quarter. This is partly due to last year’s lengthy negotiations that resulted in the UK leaving the European Union at the end of January this year, and the uncertainty of the US/China trade war which had a significant impact.
Looking forward, the first quarter of this year could be rather sluggish too, due in part to the heavily export-dependent German economy, which is being negatively affected by the slowing of the Chinese economy as a result of the coronavirus, France’s weakening economic performance and widespread social turmoil caused by unpopular economic reforms, and the UK’s need to re-establish an economic relationship with the European Union by year’s end.
Nevertheless, Europe remains the most popular destination in the world for tourism, the major franchise companies continue to focus development efforts in many areas of the region, and hotel operating performance remains positive, all of which continues to be a significant driver of hotel development in the region.
In 2019, 435 new hotels with 58,202 rooms opened throughout Europe, the highest number of new hotel openings ever recorded. As a result of the robust construction pipeline, the LE forecast for new hotel openings will continue to be strong with 457 new hotels/63,402 rooms anticipated to open in 2020 and rising to 503 new hotels/72,078 rooms in 2021.