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European Hotel Investment: Current and Future Trends


The European hotel investment landscape is changing greatly, marked by a strong recovery from the pandemic, shifts in investor focus, and emerging market dynamics. 

Savills’ latest research indicates that investment volumes for European hotels in 2024 are set to exceed those of 2023 significantly. Spain, which surpassed the UK in 2022 to become Europe’s largest hotel investment market, maintained its lead in 2023 with €4.2 billion in hotel transactions, compared to the UK’s €2.62 billion.

In 2024, over €1 billion worth of UK hotel assets have already changed hands, suggesting that the total annual volume will exceed last year’s figures.

Additionally, the Savills Survey reveals a strong investor appetite for the hospitality sector over the next three years. Survey respondents plan to invest approximately €10 billion, focusing on serviced apartments, lifestyle hotels, and mid-market hotels.

As we approach the end of 2024 and beyond, understanding these trends is crucial for stakeholders who want to capitalise on investment opportunities.

Current Trends in European Hotel Investment

Recovery and Resilience: The European hotel industry has shown remarkable resilience, rebounding strongly from the impacts of the pandemic. Revenue per available room (RevPAR) has reached or even surpassed pre-pandemic levels in many regions. This recovery is driven by a surge in international travel and a robust events calendar, which are boosting occupancy rates and revenues across the continent. According to Deloitte, London’s RevPAR is expected to see significant growth in 2024, reflecting a broader trend across major European cities. Similarly, a report by Hospitality Investor highlights that the European lodging industry has not only recovered but is now exceeding pre-pandemic performance levels, with a full recovery of RevPAR and surpassing 2019 figures​​​.

Urban Markets Leading the Way: Urban centres like London and Paris are becoming prime targets for hotel investors. London, in particular, has emerged as the most attractive European city for hotel investment in 2024. This is due to its status as a global business and tourism hub, attracting significant international traffic and business travellers. The city’s RevPAR is expected to grow significantly, with many investors optimistic about its long-term profitability. Deloitte’s research indicates that London has climbed to the top of the rankings for hotel investment, driven by its robust tourism and business travel markets. Paris follows closely, benefiting from its appeal as a cultural and business destination, further underscoring the trend of urban market dominance in hotel investments.

Increasing Investment Volumes: Investment volumes in the European hotel market are projected to grow by 15% to 25% in 2024. This increase is fueled by improved capital market conditions and the anticipated easing of interest rates by the European Central Bank. Investors are particularly interested in urban markets, with the greatest potential for high returns. According to JLL, urban markets are proving to be the most appealing for hotel investment, with a substantial portion of capital expected to be deployed towards these areas. The report also highlights that the European hotel investment market is set to see significant growth, driven by increased international travel and favourable economic conditions​.


Future Trends and Opportunities

Focus on Quality Assets: Investors are increasingly looking for high-quality hotel assets that promise strong operational performance and resilience against economic fluctuations. This trend is driving more strategic acquisitions and mergers in the coming years. High-quality assets are attractive due to their ability to withstand market volatility and generate consistent returns. Deloitte’s insights emphasise that demand for premium hotel properties remains robust, with investors prioritising assets with strong financial performance and long-term growth potential​​. Hospitality Investor also notes that quality assets in prime locations continue to draw significant interest from both domestic and international investors​​.

Digital Transformation and Innovation: While digital transformation is not as high a priority as it was in previous years, there remains a significant opportunity for hotels to leverage technology. Innovations such as Generative AI can enhance operational efficiency and improve guest experiences. Despite only a quarter of industry leaders viewing it as a critical tool, those investing in advanced technologies can gain a competitive edge. Deloitte reports that implementing digital solutions can streamline operations, reduce costs, and enhance customer satisfaction​. As technology evolves, the adoption of AI and other digital tools is expected to grow, reshaping the hospitality industry​​.

Addressing Labour and Inflation Challenges: Labour shortages and inflation are significant concerns for the hotel industry. To maintain profitability, hotels need to develop strategies to manage rising costs and attract skilled workers. This includes investing in employee training programs and adopting more flexible labour models. Deloitte highlights that effective labour management is crucial for sustaining growth and operational efficiency​. Hospitality Investor adds that addressing these challenges requires a comprehensive approach, including better workforce planning and improved employee benefits to retain talent​.

Education and Skills Development: As the industry evolves, there is an increasing need for well-trained professionals. Pursuing a degree in hotel management provides the necessary skills and knowledge to navigate the complexities of the modern hospitality industry. Leading hospitality institutions offer comprehensive programs that prepare graduates for the investing field. These educational programs are designed to equip future hospitality leaders with the expertise to manage high-quality assets and effectively leverage technological advancements.


The European hotel investment market is poised for significant growth and transformation in 2024 and into 2025. Investors who stay attuned to market trends and focus on quality assets will likely find lucrative opportunities. Addressing operational challenges and leveraging technological advancements will be crucial for sustaining growth and profitability in the coming years.


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