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Not surprisingly, the global recession is negatively impacting hotel development throughout EMEA, according to Lodging Econometrics' Q1 2009 construction pipeline report for the region. Europe's construction pipeline sits at 912 projects/153,189 rooms, down 11 percent from Q2 2008's cyclical peak, while the Middle East pipeline has plunged 14 percent to 477 projects/142,702 rooms. Africa's pipeline of 174 projects/35,253 rooms represents a 3 percent drop from the peak.
The three regions are also facing a backlog of stalled hotel projects. Construction starts in Europe hover at a low of 68 projects/10,839 rooms; LE projects that those figures will drop further. In the Middle East, construction starts have dropped 50 percent from their peak. Dubai's pipeline—124 projects/48,558 rooms—accounts for 34 percent of all hotel development in the region. New project announcements include 79 in Europe (36 of which are in the UK); 22 throughout Egypt, Saudi Arabia, and Abu Dhabi; and 18 in Africa, with four of those projects in Morocco.
Additionally, project cancellations and postponements have increased due to the global recession. "The availability of financing is so restrictive and lodging operation declines are impacting so significantly that, of the 116 cancellations/postponements reported, 51 or 44 percent were already under construction and abruptly halted," according to LE's report.
Q1 saw the debut of 68 new hotels representing 11,924 guestrooms throughout EMEA; 60 percent of those openings were in Europe, and 28 percent were in the Middle East. LE forecasts that total new openings for Europe this year will be down 10 percent from 2008 but will significantly bounce back in 2010. Growth in the Middle East and Africa is poised to accelerate each year into 2011.
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Hotel Construction Pipeline Drops throughout EMEA
June 4, 2009Not surprisingly, the global recession is negatively impacting hotel development throughout EMEA, according to Lodging Econometrics' Q1 2009 construction pipeline report for the region. Europe's construction pipeline sits at 912 projects/153,189 rooms, down 11 percent from Q2 2008's cyclical peak, while the Middle East pipeline has plunged 14 percent to 477 projects/142,702 rooms. Africa's pipeline of 174 projects/35,253 rooms represents a 3 percent drop from the peak.
The three regions are also facing a backlog of stalled hotel projects. Construction starts in Europe hover at a low of 68 projects/10,839 rooms; LE projects that those figures will drop further. In the Middle East, construction starts have dropped 50 percent from their peak. Dubai's pipeline—124 projects/48,558 rooms—accounts for 34 percent of all hotel development in the region. New project announcements include 79 in Europe (36 of which are in the UK); 22 throughout Egypt, Saudi Arabia, and Abu Dhabi; and 18 in Africa, with four of those projects in Morocco.
Additionally, project cancellations and postponements have increased due to the global recession. "The availability of financing is so restrictive and lodging operation declines are impacting so significantly that, of the 116 cancellations/postponements reported, 51 or 44 percent were already under construction and abruptly halted," according to LE's report.
Q1 saw the debut of 68 new hotels representing 11,924 guestrooms throughout EMEA; 60 percent of those openings were in Europe, and 28 percent were in the Middle East. LE forecasts that total new openings for Europe this year will be down 10 percent from 2008 but will significantly bounce back in 2010. Growth in the Middle East and Africa is poised to accelerate each year into 2011.
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