LBM dealers are still pinching themselves. There are exceptions, but construction activity in many U.S. markets is up—sometimes by a lot—despite the pandemic.
Not just single-family homes, either. Hotel Management reports that “at the close of the second quarter of 2020, the total U.S. hotel construction pipeline stands a 5,582 projects and 687,801 room, down just 1% by hotels and rooms year-over-year.”
At first glance, that sounds wrong. It makes sense that the single-family market is holding up with Millennials solidly in their first-home-buying years and the pandemic driving the need for secure shelter.
But hotel occupancy is down nearly 40% YoY according to Calculated Risk. Plus, remote meetings are catching on in a way that suggests business travel may never return to its pre-pandemic levels.
In fact, says Hotel Management, the industry is for the most part working down the backlog of projects already in the pipeline. With “nonessential travel halted and with the ongoing pandemic, new development deal signings have slowed.” Announcements of new projects in Q2 2020 are down 53% compared with Q2 2019.