European hotel transactions reach five-year high: C&W
European hotel transactions reached a five-year high of €22.4 billion in 2024, up 37% from the previous year, according to new data analysis from Cushman & Wakefield.
“The European hotel market continues to hold great attraction to investors seeking to deploy capital”, said Jon Hubbard, Head of EMEA Hospitality, Cushman & Wakefield. “From an asset perspective, the upper end of the market has attracted a lot of interest and pricing should remain competitive as the supply of new accommodation slows due to development costs. We anticipate transactional activity will expand further in 2025, supported by rising debt liquidity and healthy hotel performances.”
The UK reclaimed its status as the top destination for investor capital with €7.8bn worth of deals transacted, an increase of 197% on the previous year, followed by Spain and France. Between them, these three markets accounted for 59% of total European volumes at €13.2bn, up 38% on 2023 volumes.
Among the top 10 European markets, the most notable increases in investment volumes relative to 2023, were in Greece (+294%), Norway (+248%) and Ireland (+218%).
At a city level, London was the leading destination for investor activity with €4.0bn transacted, ahead of Paris at €1.6bn and Dublin at €0.6bn.
The UK accounted for the four largest hotel transactions in 2024, all of which were portfolio deals: the sale of ADIA’s Marriott portfolio (33 hotels); the Village Hotels portfolio (33 hotels); the Radisson Edwardian portfolio (10 hotels); and Landsec’s Accor portfolio (21 hotels).
The average transaction price per room in Europe in the second half of last year was €163,000, down from €188,000 during the same period in 2023. This was driven by shifts in transaction composition, including class and location, rather than an indication of continued discounting.
In fact, the analysis shows that after decompressing in 2023, yields remained stable throughout 2024, with values being supported by growing income and high barriers to entry for the top end of the market. In 2025, the improving sentiment, declining cost of financing and return of core investors are expected to put downward pressure on yields, especially in the case of prime locations and assets.
From an investor perspective, private capital accounted for the largest share of deals at 45%, reflecting a 45% increase compared to 2023. Elsewhere institutional investment represented 39% of transactions and public finance 13%, which was a large increase on 2023 (352%). Institutional (39%) and private (40%) sellers were the biggest sources of deals.
Investor focus remained on the premium end of the market, with hotels classed as Luxury or Upper Upscale accounting for a combined 42% of the volumes transacted in 2024.
