The Global Construction Newsletter Q1 2023

View Table
View Table

What does it cost in the United States and around the world to build a 2 or 3-star (middle-of-the-road) hotel? Compass International gets asked this question a lot, so we have compiled a cost per square foot & square meter benchmark report on 25 U.S. and International locations. This book was designed to help simplify the hotel building cost calculations that determine the cost of building a hotel and can be viewed or downloaded below.


Notes / Comments: It is difficult to compute the exact cost to build a hotel because there are so many variables to the square foot (SF) / square meter (M^2) unit cost, such as:

  1. Location: Is the hotel in a congested city center with material handling logistics and delivery problems, or is the hotel situated in the city suburbs with less material delivery logistical issues?
  2. Large or small application: Typically, the larger the usable space, the lower the unit price will be.
  3. Types of materials used: Are high-end (i.e. expensive) construction materials or middle-of-the-road construction materials and fixtures being utilized?
  4. Contracting: Approach (lump sum or negotiated contract), construction schedule (fast track, perhaps overtime pay will be required or normal approach), the local bidding climate in a particular location and an extremely active construction market tend to increase contractors’ profit margins.
  5. Union or non-union labor: This applies predominantly in the US, where the vast majority of construction in the largest 20 cities is executed by union labor, which in hotel building cost calculations is, on average, 15% to 25% more expensive than non-union labor (open shop).


Our Global Construction Costs Yearbook can help determine hotel construction costs for 2 to 3-star hotels that are equipped with the following structural features:

  • A minimum of 3 floors
  • A maximum of 6 floors
  • A minimum 10 feet from floor to floor
  • A maximum of 12 feet from floor to floor


The Total Usable Footprint Space for 125,000 SF to 200,000 SF / 11,617 M2 to 18,590 M2 Mid 2016 cost is based on the following:

  • Hotel construction costs are based on a suburban city location (average 5 to 7 miles outside of the city center).
  • Excludes architectural & engineering / detailed design fees; these typically cost 5% to 10% of the indicated construction costs indicated below:
  • Excludes construction management fees; typically 3% to 5% of hotel construction costs below:
    • Excludes land purchase, furniture, fixtures, restaurant / kitchen items, artwork, linens, towels, bedding, etc.


#LocationLow Range Construction Cost $ / SFHigh Range Construction Cost $ / SFAverage Construction Cost $ / SF
Average Construction Cost $ / M²
(SF costs multiplied by 10.76)
1New York City, NY$198 per ft²$339 per ft²$269 per ft²$2,889 per m²
2Chicago, IL$182 per ft²$319 per ft²$251 per ft²$2,695 per m²
3Los Angeles, CA$177 per ft²$315 per ft²$246 per ft²$2,647 per m²
4San Francisco, CA$186 per ft²$330 per ft²$258 per ft²$2,776 per m²
5Washington, DC$182 per ft²$312 per ft²$247 per ft²$2,658 per m²
6Toronto, ON$180 per ft²$308 per ft²$244 per ft²$2,625 per m²
7Vancouver, BC$174 per ft²$303 per ft²$239 per ft²$2,566 per m²
8London, UK$195 per ft²$336 per ft²$266 per ft² $2,857 per m²
9Paris, France$189 per ft²$324 per ft²$257 per ft²$2,760 per m²
10Rome, Italy$181 per ft²$308 per ft² $245 per ft²$2,631 per m²
11Zurich, Switzerland$193 per ft²$333 per ft²$263 per ft²$2,830 per m²
12Berlin, Germany$184 per ft²$314 per ft²$249 per ft²$2,679 per m²
13Mexico City, Mexico$127 per ft²$215 per ft²$171 per ft²$1,840 per m²
14Rio de Janerio, Brazil$138 per ft²$220 per ft²$179 per ft²$1,926 per m²
15Abu Dhabi, UAE$186 per ft²$310 per ft²$248 per ft²$2,668 per m²
16Beijing, China$132 per ft²$246 per ft²$189 per ft²$2,034 per m²
17Tokyo, Japan$180 per ft²$306 per ft²$243 per ft²$2,615 per m²
18Hong Kong, China$194 per ft²$332 per ft²$263 per ft²$2,830 per m²
19Sydney, Australia$168 per ft²$290 per ft²$229 per ft²$2,464 per m²
20Oslo, Norway$192 per ft²$328 per ft²$260 per ft²$2,798 per m²
21Madrid, Spain$140 per ft²$250 per ft²$195 per ft²$2,098 per m²
22Moscow, Russia$140 per ft²$220 per ft²$180 per ft²$1,937 per m²
23Istanbul, Turkey$90 per ft²$150 per ft²$120 per ft²$1,291 per m²
24Warsaw, Poland$130 per ft²$210 per ft²$170 per ft²$1,829 per m²
25Johannesburg, South Africa$120 per ft²$180 per ft²$150 per ft²$1,614 per m²

Compass International’s (7) Global Cost Books detail Facilities / Buildings, Energy, Power, Offshore & Process cost models & unit prices, our cost books provides Construction Professionals with up to date construction cost data for more than 100 counties, visit our website at  to view our latest 2016 books, our most recent free newsletter, free tools / resources  & blogs.

Download PDF

For additional information contact John G. McConville, CCP

Operations Director – Telephone (609) 577 4505

Compass International at

View All of Our Books