Birmingham hotel market leads Alabama in new construction

Birmingham has the highest percentage of hotel rooms under construction in Alabama, according to recent data published by CoStar Analytics.

The report highlights a major surge in the state’s hospitality pipeline, driven primarily by development in Birmingham and Huntsville. Midscale extended-stay brands dominate the new development across the state, while adaptive reuse projects and lifestyle concepts add to the variety of the market.

Birmingham hotel market leads Alabama in new construction

The data reveals that Birmingham’s hospitality sector is outpacing other major metropolitan areas in the state:

• Birmingham has approximately 1,000 hotel rooms currently under construction.
• This development represents 5.8% of the market’s total hotel inventory, making it the highest percentage of any region in Alabama.

Although the CoStar data is focused mostly on new builds and adaptive reuse projects, in the last few years, Birmingham has seen an increase in both new and renovated hotels. This growth is a sign of confidence in Birmingham’s day-to-day economic activity and its appeal as a regional travel and business hub.

Some of the completed and anticipated new builds across Birmingham are:

• Brown Marx Tower
  • Ascent Hospitality currently transforming the 117-year-old downtown tower
  • Being adapted into a dual-branded AC Hotel + Element Hotel
  • 190 short-term rooms + 148 longer-stay rooms (338 total rooms)
• Residence Inn by Marriot Birmingham Grandview
  • Combination of Residence Inn and Courtyard by Marriott
  • 96 kitchen suites + 84 rooms (180 rooms total)
  • Opened March 1, 2026
• The Painted Lady
  • 22-room luxury boutique hotel
  • Housed in the late-1800s Eyers-Raden Building
  • Pays homage to historic local figure Louise Wooster
  • Opened Spring 2025

Completed renovations include:

• Downtown Hilton at UAB
  • All 295 guest rooms refreshed
  • 16,000 square feet of meeting space renovated
  • New fitness center
  • Debut of Blazer’s Grill restaurant
• Embassy Suites by Hilton Birmingham
  • All 242 rooms refreshed
  • New locally-inspired design touches
  • Upgraded atrium + lobby
  • Modernized fitness + pool facilities

Another notable renovation is the A.G. Gaston Motel. Although the historic motel no longer accommodates overnight guests, the National Park Service is working on a $4 million, 18-month interior restoration.

The current project is focused on recreating the 1960s guest rooms and the famous “War Room.” The 1968 wing — which includes a local coffee shop and City of Birmingham exhibit space — remains open to visitors during the construction.

Huntsville + Mobile see major hospitality growth

While Birmingham leads in the percentage of inventory growth, other regions across the state are also seeing significant expansion, according to the CoStar report:

• Alabama North (Huntsville area) matches Birmingham in total volume with roughly 1,000 rooms under construction, representing 3.7% of its total inventory.
• Mobile follows closely behind Birmingham in momentum, with 5.6% of its inventory under construction, totaling more than 800 rooms.
• Alabama South (entire southern portion of AL excluding Mobile) shows more modest growth, with 2.6% of its inventory under construction, accounting for roughly 600 rooms.