In 2024 global hotel investment will see a major rebound, mainly due to the robust growth of cross-border transactions. Hotel investment trends were dominated by regional differences, and the Asia-Pacific region continued to present promising opportunities. Global hotel investment outlooks for 2025 remain positive, despite possible risks like geopolitical pressures and inflationary factors.
CBRE’s latest 2024 Global Hotel Capital Flows Report, global cross-border investment in hotels saw a strong increase of 54% in 2024 compared to the previous year. This marked a significant shift in global hotel investment. This growth has increased the total volume of hotel transactions by 16% in the last year. It indicates a strong rebound from the economic downturn caused by the COVID-19 epidemic.
EMEA emerged as the leading source of cross-border investment in the Americas, with 74% of all volumes of inbound capital. The decline in Asia-Pacific investment, especially from Greater China, was a contributing factor. The full-service hotel sector remained as the most popular investment, accounting for 87% of cross-border investments in 2024.
In EMEA 61% of the hotel investment volume was accounted by foreign capital. The interest of investors based in the United States was a major factor. The UK remained as the number one destination while Italy, Portugal, Greece, and Spain all saw a significant increase in cross-border investing.
Asia-Pacific outperformed both the Americas, and EMEA. Total hotel investment volume reached 90% of levels in 2019. This growth was largely due to strong purchases by investors within the region. The U.S. remains the largest source of cross border capital with an annual increase of 23% in flows since the start of COVID-19. In 2024, Japan saw a dramatic increase in capital inflows. It accounted for almost 50% of all cross-border investments in the region.
In 2024, global cross-border investment in hotels as a proportion of the total volume of transactions exceeded pre-pandemic rates. The hotel industry was the only one to experience this trend, since other commercial real estate assets have not recovered fully. Over the last decade, strong cross-border investments have resulted in a significant increase of foreign hotel ownership.
Asia-Pacific is a brighter spot than ever since COVID-19. It has seen a 12% rise in annual capital flows between 2020-2024. This was driven primarily by the steady purchase of U.S. investors. The reduced investment outbound from Greater China resulted in a 52% and 70% decline in capital flows into EMEA.
Both domestic and international investment in the hotel sector is expected to be positive by 2025. CBRE believes that lower interest rate, a positive tourism and travel outlook, and favorable demand/supply fundamentals will encourage more capital to flow into the hotel sector.
Conclusion: Despite the risks associated with geopolitical issues, currency fluctuations and inflationary pressures the strong performance of the global hotel capital flow in 2024, as well as the positive outlook for 2025, indicate a stable future for global hotel investments.
Download the latest version of the software Full Year 2024 Global Hotel Capital Flows ReportIncludes detailed regional analysis.
