JLL’s Hotels & Hospitality Group has released its annual Global Hotel Investment Outlook, projecting a 15% to 25% increase in global hotel investment volume compared to 2024. The report highlights the industry’s resilience and potential for growth as it adapts to evolving travel patterns and consumer preferences.

2024 in review: uneven recovery in the global hotel market

Through November, global hotel demand reached a staggering 4.8 billion room nights, 102 million more than in 2023, resulting in RevPAR growth of 4%. Though RevPAR grew in all regions, performance remains uneven, with Asia Pacific (APAC) still lagging 10% behind 2019 levels while the Americas, Europe and the Middle East have all fully recovered.

Global hotel investment volume reached $57.3 billion in 2024, a 7% increase from 2023, but remained 17% below historical levels driven by historically limited portfolio volume and significant declines in average deal size. The global increase was fuelled by growth in APAC and EMEA, while the Americas transaction volume declined modestly for the second consecutive year.

Private equity remained the most active hotel buyer globally, with a notable increase in investments from high-net-worth individuals, REITs and first-time hotel investors. This trend is expected to continue in 2025 and beyond, with cross-border investments likely to rise as U.S. investors capitalize on a strong Dollar and cash-rich Middle Eastern investors look to deploy capital into Europe and select U.S. cities.

JLL expects global hotel investment volume to accelerate in 2025, likely exceeding 2024 by 15% to 25%. This growth will be catalyzed by impending loan maturities, deferred capital expenditures, private equity fund-life expirations and moderating RevPAR in some markets, with the Americas expected to see the largest growth followed by EMEA and APAC.

The luxury and select-service sectors will continue to be most favored and liquid in 2025, with urban cities and high barrier-to-entry markets expected to attract the most investor interest. Foreign investment should also accelerate further as some investors look to capitalize on strengthening currencies. Cash-rich Middle Eastern and select-U.S. private equity investors will likely be the most acquisitive, targeting quality assets across Europe and Asia, respectively.

In 2025, slowing new supply will spur hotel brands to continue to use their balance sheets to fuel net unit growth, a key driver of shareholder value. Look for increased hotel brand M&A and private equity investment in third-party management companies, non-traditional lodging brands and hotels in the lifestyle sector.

As we consider the transaction market in 2025, we expect to see a reemergence of two key contributors to overall volume, portfolio transactions and urban full-service hotel sales. We are hopeful that improved liquidity in the debt and equity markets will allow those segments to return to their traditional contributions toward overall sales activity. Daniel C. Peek, President, Americas, JLL Hotels & Hospitality Group

Key themes to watch in 2025

• The great merging is here: live-work-play boundaries blur – The boundaries between living, working, and playing are blurring, with lifestyle hotels emerging as the new “third place.” This shift is driving expansion into branded residences and alternative accommodations as hotels capitalize on the growing Experience Economy.
• Evolution of global travel and emerging market influence – Emerging markets, particularly India and Saudi Arabia, are set to play increasingly significant roles in shaping future travel trends, creating new opportunities for development and investment.
• Rise in the adoption of artificial intelligence in the hospitality industry – Strategic implementation of AI will be crucial for optimizing hotel operations, enhancing guest experiences and addressing ongoing labor challenges.

Final thoughts

As the global hotel industry enters a pivotal year, JLL’s flagship Global Hotel Investment Outlook offers crucial insights into the evolving investment landscape for 2025 and beyond. From urban resurgence to the expansion of hotel brands into new verticals, this comprehensive outlook equips you with the knowledge to navigate the dynamic hotel investment terrain in 2025.

The hotel industry stands at a transformative crossroads, where embracing technological innovation and adapting to evolving consumer preferences will be key to unlocking unprecedented value and shaping the future of hospitality. Kevin Davis, CEO, Americas, JLL Hotels & Hospitality Group

Global real estate investors are increasingly gravitating to the hotels sector evidenced by near historic levels of first-time capital invested in 2024. We expect this dynamic to continue throughout 2025 as hotels emerge as a preferred asset class driven by outsized yields, robust operating performance and favorable supply dynamics. Zach Demuth, Global Head of Hotels Research, JLL Hotels & Hospitality Group

JLL’s Hotels & Hospitality Group has completed more transactions than any other hotels and hospitality real estate advisor over the last five years, totalling $83 billion worldwide. The group’s 370-strong global team in over 20 countries also closed more than 7,350 advisory, valuation and asset management assignments. Our hotel valuation, brokerage, asset management and consultancy services have helped more hotel investors, owners and operators achieve high returns on their assets than any other real estate advisor in the world.