Savills names UK most liquid European hotel market
UK hotel transactions reached £2.1bn in H1 2026, a £500m year-on-year increase, with London alone accounting for £1.4bn and attracting buyers from Spain, Italy, Israel, Singapore, and domestic sources.
Photo by Savills
New research from international real estate advisor Savills shows that the UK accounted for 24% of all European hotel investment volumes in the first half of 2026, reinforcing its position as the region’s most liquid hotel investment market, as investors look ahead to a more selective period for growth and returns.
UK hotel transactions totalled £2.1 billion in H1 2026, representing an increase of almost £500 million compared with the same period in 2025. Savills says the sustained level of investment demonstrates the sector’s resilience despite moderating revenue growth, rising employer National Insurance contributions and business rates, as well as uncertainty surrounding the potential introduction of a levy on overnight stays. This suggests that the sector’s robust performance in the face of these pressures, together with the UK’s deep demand base, transparent legal system and relative ease of doing business, will become increasingly important as investors become more selective.
London continues to underpin the UK’s strong position, recording £1.4 billion of hotel transactions in H1 2026. According to the real estate advisor, the breadth of London’s buyer pool also provides evidence of its enduring global appeal. Investors behind the largest London hotel transactions between July 2025 and June 2026 originated from Spain, Italy, Israel and Singapore, alongside domestic buyers. The arrival of new entrants is further expanding the funds available to the sector. OneIM, Punta Na and Generali all made their first UK hotel acquisitions during the period, while established investors including CDL, Criterion Capital, Fattal Hotels and the Arora Group have continued to grow their hotel holdings, especially in London.
The real estate advisor notes that UK regional operational performance remains uneven. While 23 of the 32 UK markets analysed are recording year-on-year growth in revenue per available room, or RevPAR, only ten have moved ahead of 2019 levels in real terms.
Owner-operators and private equity accounted for 40% and 37% of London hotel transaction volumes, respectively, between 2024 and H1 2026. Savills suggests this demonstrates continued confidence in both the operational potential of London hotels and the opportunities available to investors pursuing value-add strategies.
Savills says the investment picture is supported by resilient visitor demand and constrained hotel development. VisitBritain is forecasting 44.2 million inbound visits and £33.9 billion of visitor spending in 2026, while UK room supply increased by just 0.6% in the 12 months to June. Rooms under construction represented only 2.6% of existing stock.
We expect the UK to retain its position as Europe’s leading hotel investment market, but future outperformance will be increasingly concentrated among well-located and actively managed assets. Investors with strong operating capabilities and the ability to use technology purposefully will be best positioned as revenue growth moderates and cost pressures persist
David Kellett, Head of Hotel Capital Markets EMEA
The UK’s liquidity continues to set it apart from other European hotel investment markets. London provides an unrivalled anchor, attracting both established investors and new entrants from across the globe, while the scale of regional activity demonstrates the breadth of opportunity across the country. As investors become more selective, the depth of the UK’s buyer pool and its proven exit market will become even more valuable. Capital remains available, but it will increasingly favour high-quality assets, locations with durable demand and opportunities where active ownership can deliver stronger performance
Thomas Emanuel, Head of Hospitality Thought Leadership, EMEA at Savills