While hammers are swinging and concrete’s being poured at breakneck pace across much of the globe, there’s one pocket of the hotel world where the sound of silence is growing louder. According to freshly minted data from CoStar, the Middle East and Africa were the only regions where the hotel pipeline shrank in the second quarter of 2025. A curious reversal of fortunes, considering the region’s usual flair for bold builds and record-breaking hospitality projects.
For those unfamiliar, CoStar is no stranger to such insights. As one of the world’s top real estate intelligence firms, they have more eyes on construction cranes than a flock of seagulls at a chip shop. And what they’ve reported this June is eye-opening, depending on which part of the map you’re peering at.
Asia Pacific Flexes Its Concrete Muscles
The Asia Pacific region is leading the global charge, with a staggering 957,254 hotel rooms under contract, up 4.2% from last year. China alone is responsible for a jaw-dropping 318,327 — no small feat for a country that seems to have made a national pastime out of large-scale infrastructure.
India’s no slouch either, with 40,950 rooms under construction, and Vietnam’s following hot on its heels with 36,338 — a sign that Southeast Asia’s appetite for shiny new hotels remains as voracious as ever.
Even with a sharp 54.3% drop in rooms in the “final planning” stage — perhaps a sign of cautious optimism or overextended credit — the region’s growth is driven by a whopping 21% increase in new projects entering the planning phase. In simple terms, the bulldozers aren’t slowing down any time soon.
Europe Steadies the Ship with Classic Precision
In Europe, things look pleasantly uneventful — and that’s a good thing in this business. With 431,736 rooms under contract, the continent has seen a 2.9% increase in pipeline activity. The United Kingdom leads the pack with 24,711 rooms currently under construction, followed closely by Germany’s 23,400.
But it’s not all biscuits and champagne — Europe’s final planning numbers are down nearly 20%, which may suggest developers are pausing for breath, or simply battling the rising tide of construction costs.
Still, with 185,311 rooms in the early planning stage (a healthy 15.4% boost), the long-term vision for European tourism seems intact.
Americas Build Quietly (Except the U.S., Of Course)
Across the pond, the Americas are ticking along modestly. The region boasts 902,952 rooms under contract, with a slight 1.1% uptick. Unsurprisingly, the lion’s share belongs to the United States, claiming 138,922 rooms under construction.
After that, there was a polite round of applause for Mexico (14,562), Canada (9,128), and Brazil (5,334). Though the total number of rooms “in construction” dropped by 9.3%, the future is looking brighter with increased numbers in both the planning and final planning phases.
It seems North and South America are trading hard hats for spreadsheets, reassessing the blueprint but not abandoning the build.
Middle East and Africa: Where Did Everyone Go?
Now, to the one region bucking the trend — and not in a good way. The Middle East and Africa saw a 2.6% decline in total rooms under contract, with construction numbers down 5.4%. That’s not just a hiccup; that’s a pretty pointed pause.
Saudi Arabia, usually the show’s star, is still leading the region with 46,015 rooms in construction, and the UAE is holding up its end with 16,271. But beyond that? Not much movement.
Even the “final planning” numbers are down a hefty 34.2%, suggesting fewer investors are ready to put pen to paper, or perhaps the appetite for new hotel development has cooled faster than expected.
Still, the region saw a 13.7% uptick in early-stage planning — a small spark that may yet reignite the engines.
Outlook: Cautious Confidence, Except Where It Counts
It’s fair to say that globally, the hotel industry is still building its way out of the pandemic shadow, and in most places, optimism has taken the form of bricks and mortar. From China’s turbo-charged developments to the steady hand of Europe and the cautious recalibrations in the Americas, the hospitality sector refuses to sit still.
However, the downward turn of the Middle East and Africa is a notable wrinkle. Whether it’s geopolitical jitters, tightening financing, or simple overcapacity, only time will tell if this is a blip or a bellwether.
For now, the cranes keep swinging, the foundations keep pouring — and the global hotel pipeline, with a few detours, marches ever onward.
For more insight into CoStar’s full report, visit: www.costargroup.com.
By Christine Nguyen
