by Michael J. Shapiro | December 21, 2011

The number of rooms in the total active U.S. hotel development pipeline dropped by 6.3 percent year-over-year for the month of November, according to the most recent STR/McGraw Hill Construction Dodge Pipeline Report, released last week. The current pipeline includes 2,861 projects, or 310,196 rooms. Three chain-scale segments reported increases in the pipeline, however: the luxury segment, which grew by 48.5 percent; the upper upscale segment, with a 5 percent increase; and the upscale segment, which was up 4.1 percent over last November. The luxury segment’s huge gain, however, was mitigated by the fact that there are only 1,657 rooms in the pipeline. "The upscale and upper midscale chain-scale segments are the segments to watch because they tend to be popular for new growth as the projects are often easier to finance," pointed out Vail Brown, STR’s vice president of global sales and marketing. "Along with that, the overall construction time is shorter, and during economic downturns, historically, they don’t suffer as badly as other chain-scale segments."