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Southern U.S. Cities Lead Hotel Construction Pipeline as Dallas and Phoenix Dominate Growth – Image Credit Unsplash+
The latest Lodging Econometrics report highlights that Southern and Southwestern U.S. cities, particularly Dallas, Atlanta, and Phoenix, are leading the nation in hotel construction and planning, with strong growth projected through 2027.
Overview of Hotel Construction Trends
According to the Q4 2025 United States Construction Pipeline Trend Report from Lodging Econometrics (LE), hotel construction activity in the U.S. is concentrated in several key Southern and Southwestern markets. Dallas remains at the forefront, with the largest number of projects in the pipeline, followed by Atlanta, Phoenix, Nashville, and Austin. These cities are driving future growth in the hotel sector as they continue to attract new developments and investments.
Top Markets by Total Projects
Dallas leads the nation’s hotel construction pipeline at the close of Q4 2025, with 193 projects totaling 23,720 rooms. Atlanta is second, with 159 projects and 17,804 rooms. Phoenix, Nashville, and Austin complete the top five, with 124 projects/16,303 rooms, 120 projects/15,983 rooms, and 120 projects/14,120 rooms, respectively. These figures indicate a significant concentration of hotel development in these metropolitan areas.
Under Construction Activity
In terms of projects currently under construction, Phoenix leads with 35 projects totaling 4,829 rooms. Dallas follows closely with 34 projects and 3,663 rooms. Other leading markets in this stage include New York (29 projects/5,689 rooms), Miami (24 projects/4,843 rooms), and Atlanta (21 projects/2,206 rooms). The data suggests that both established and emerging markets are experiencing active hotel development.
Planned Construction Starts
Dallas is projected to see the highest number of construction starts over the next 12 months, with 74 projects totaling 8,202 rooms. Atlanta is next with 58 projects and 6,658 rooms, followed by Austin (51 projects and 5,499 rooms), the Inland Empire (44 projects and 4,467 rooms), and Nashville (42 projects and 5,981 rooms). These planned starts reflect the ongoing momentum in these regions.
Early Planning Stage
The early planning stage further demonstrates Dallas’s strong position, with 85 projects/11,855 rooms. Atlanta has 80 projects totaling 8,940 rooms in early planning. Nashville (59 projects/7,648 rooms), the Inland Empire (59 projects/5,908 rooms), and Orlando (51 projects/10,777 rooms) also show significant early-stage activity. This indicates a robust pipeline that extends beyond projects currently underway.
Renovation and Conversion Trends
LE’s report notes steady renovation and conversion activity across the country. Houston and Atlanta each have 35 projects, with 5,411 and 4,314 rooms, respectively. Washington DC follows with 34 projects/3,963 rooms, Chicago has 29 projects/5,397 rooms, and New York rounds out the top five with 28 projects/7,293 rooms. These projects represent ongoing investment in existing hotel assets.
New Project Announcements
During the fourth quarter, 285 new hotel projects were announced nationwide. Phoenix led with 12 projects and 1,347 rooms, followed by Atlanta (8 projects/854 rooms) and Saint Louis (7 projects/725 rooms). Tampa and the Inland Empire also saw new announcements with 6 projects/664 rooms and 5 projects/535 rooms, respectively.
Forecast for 2026 and 2027
Looking ahead, Phoenix is expected to open 23 new hotels totaling 3,326 rooms in 2026. New York is forecast to open 22 hotels with 3,795 rooms, Dallas 19 hotels with 2,295 rooms, Austin 13 hotels with 1,738 rooms, and the Inland Empire 12 hotels with 1,024 rooms. In 2027, Dallas is projected to lead with 37 new hotels and 3,198 rooms, followed by Atlanta (28 hotels and 2,554 rooms), the Inland Empire (18 hotels and 1,693 rooms), Phoenix (17 hotels and 2,078 rooms), and Los Angeles (15 hotels and 1,769 rooms).
The report confirms that Southern and Southwestern markets are driving U.S. hotel construction growth. Dallas, Atlanta, and Phoenix are expected to remain leaders in new hotel openings and pipeline activity through at least 2027, reflecting ongoing demand and investment in these regions.
