California hotel construction boom to continue: Atlas Hospitality Group

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California set a new record in 2017 for the most hotel rooms opened in a single year, Atlas Hospitality Group has reported in its 2017 California Hotel Development Survey.

Overall, 10,793 rooms were made available, slightly higher than the previous record set in 2008 of 10,286 rooms.

Overall, there are 859 hotels with 125,749 rooms reported in various stages in planning, a 23 percent increase from 2016.

The survey, reported in Bisnow, says the greatest growth has occurred in Los Angeles and Riverside counties, with 4,309 and 1,236 rooms opened respectively.

The report says that 2018 looks to be even stronger, despite the increase in supply, with 145 hotels under construction — with 20,693 rooms.

“Across the board we’re seeing development way, way up,” Alan Reay, president of consultant and broker Atlas Hospitality Group in Irvine, was quoted in Orange County Business Journal. “The price of existing hotels here is way above replacement costs,” which makes development more attractive.”

The slight dip in new rooms—1,655 this year compared with 1,808 last year—is due largely to the 2016 opening of Great Wolf Lodge in Garden Grove last year, with its 603 rooms. It’s the largest hotel by room count that opened in California in 2016.

 

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