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With Nearly 20,000 Rooms In The Pipeline, LA Leads U.S. Hotel Construction

Raleigh Studios in Hollywood

Hotels in Los Angeles are still working to recover from the pandemic, but developers appear to be bullish on the sector's future. 

LA is leading the nation in new hotel room construction, reports L.A. Business First, citing a new report from New Hampshire-based Lodging Econometrics

At the end of 2021, Los Angeles had 19,815 rooms across 120 projects in the works, Lodging Econometrics found.

LE estimates that 3,630 of those rooms are under construction now, with another 6,278 rooms scheduled to begin construction within the next 12 months. An additional 9,900 rooms are in the early planning stages, according to LE, which tracked construction pipeline activity for the top 50 markets in the U.S.

The firm also forecasts that the Los Angeles market will rank fourth in the nation for new hotel openings this year, as just over 3,000 rooms in 19 projects are slated to open.

The city's hotel sector continues to be impacted by the pandemic. Hotel occupancy in LA averaged just under 64% last year, LABF reported, citing data from STR. That was a vast improvement over 2020's average of about 49%, but still a significant drop from 2019's 79.3% occupancy average.

In late 2021, hotel bookings in LA reached 100% of their pre-pandemic levels, in large part due to leisure travelers, the Los Angeles Times reported

Earlier this week, in a show of confidence in LA's hotel market, AEG announced it was looking to sell part ownership in its L.A. Live hotels, the J.W. Marriott and The Ritz-Carlton. It's planning to use the money to help fund an 800-room expansion of the hotel complex on a neighboring site.