Welcome to the 2025 Portugal Hotels and Chains Report, a comprehensive exploration of the dynamic hospitality industry in Portugal. This report delves into the unique opportunities and challenges facing this flourishing market, offering valuable insights.

Portugal’s hospitality industry continues to stand out as one of Europe’s most dynamic and resilient markets. In 2024, the country reinforced its position as a top-tier global tourism destination, buoyed by sustained demand, growing international interest, and a robust investment environment.

While traditional destinations like Lisbon, Porto, and the Algarve remained strongholds of growth, there was a notable surge in visitor numbers to lesser-known regions, signalling a broader diversification of tourism flows.

The sector’s evolution has been marked by a shift toward more sustainable, experiential, and culturally immersive travel. This has driven both strategic investments and operational innovation, particularly in the midscale segment, which is experiencing a rapid rise in popularity among younger, budget-conscious travellers. Meanwhile, institutional investors continue to demonstrate high confidence in the Portuguese market, despite macroeconomic challenges, with new developments and brand entries expanding across the country.

This report provides a detailed snapshot of current performance, development pipelines, and market trends shaping Portugal’s hotel landscape. From the increasing dominance of international hotel chains to the strong RevPAR growth across emerging destinations, the 2025 edition offers a timely, data-driven perspective on the forces driving this high-performing European hospitality market.

Market Dynamics

• Strong Growth: In 2024, Portugal reinforced its position as a leading global tourism destination, with a 5% rise in guests and a 4% increase in overnight stays, mostly driven by international travellers (over 70%).
• Revenue Performance: Hotel revenues rose by 12%, with RevPAR up 8% to €65.4 and occupancy at 62.3%.
• Urban Focus with Rural Expansion: While Lisbon and Porto remain dominant (Lisbon RevPAR at €112.6; Porto overnight stays up 9%), lesser-known areas like Oeste, Vale do Tejo, and the Azores also saw 8–10% growth in overnight stays.

Key Highlights

Shift Toward International Brands

• International brands are growing as domestic brands shrink.
  • Davidson Kempner acquired 21 distressed hotels and handed operations to Highgate.
  • Rebranding of NAU Hotels & Resorts properties under Marriott (e.g., Marriott Residences Salgados Resort).
• Hilton plans to add 2,000+ rooms; Marriott is developing a €52.5M luxury resort at Verdelago.

Development Pipeline Led by Lisbon

• Lisbon City has the most projects: 34 hotels / 5,167 rooms in the pipeline.
• Opening Targets for 2025: 24 new hotels across Lisbon, North, Algarve, and Alentejo.
• Challenges: Licensing delays, financing, and technical issues are affecting delivery timelines.

Midscale Segment Booming

• 16 new chain midscale hotelsadded in 2024, surpassing other segments in growth.
• Trend driven by younger, budget-conscious travelers seeking experiential stays.

Institutional Investment Remains Strong

• Davidson Kempner: Largest institutional owner with 21 hotels, €773M investment.
• Other major investors: Arrow Global (8 hotels), Azora, Square Asset, and Extendam.

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About Horwath HTL

Horwath HTL is focused one hundred percent on hospitality, tourism, and leisure consulting. Our services cover every aspect of hotel real estate investment, tourism, and leisure development. Our clients choose Horwath HTL because we have earned a reputation for impartial advice that will often mean the difference between failure and success. Each client project is unique, and they rely on us to utilize the experience we have gained throughout our 100-year history to assist them in achieving their goals. Being a global firm with 52 offices in 40 countries, we have successfully carried out over 40,000 assignments for both public and private clients. As part of the Crowe Global network, a top-ten accounting, and financial services network, Horwath HTL is the number one choice for companies and financial institutions looking to invest and develop in the industry.

For more information, please visit www.horwathhtl.com.

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