Modular construction. Use of modular construction has been steadily growing in the hospitality sector over the past few years. Although the technology has the potential to lower costs in the long term, the main benefit today is a significant decrease in development time.
Unique designs. New hotel projects are focusing on specialization to fit their particular location and target market. This can include much smaller room sizes, lobbies with integrated bars and restaurants, and more outdoor space, all of which impact cost to build and type of materials needed for a project.
High construction costs. Labor shortages and rising costs that are plaguing the entire construction industry, high costs are leading to a forecast decline in new hotel supply in 2020. 2019 is expected to see peak levels of new hotel rooms, with volume stabilizing thereafter.