European hotel transactions rise 30% in 2025 to €22.6 billion

The European hotel investment market saw another year of strong performance in 2025 with total transaction volume reaching €22.6 billion, a rise of 30% on the previous year, according to our latest HVS European Hotel Transactions Report.

This is the third-highest transaction level ever recorded, with some 461 deals involving 725 hotels and more than 107,000 rooms, making 2025 the best-performing year since the peak year of 2019.

Hotels transacted for an average price of €31.1 million, up 7% on the previous year. The average price per room was €210,000, a fall of 2% from 2024 levels. Private equity activity dropped by 39% on the previous year, leaving owner-operators and real estate investment companies the dominant forces in the transaction market.

The UK retained its position as Europe’s most active hotel investment market, accounting for 25% of total European volume. France rose to second place, pushing Spain into third place. Germany, the fourth most active market, delivered one of the year’s most impressive recoveries, reaching €2.5 billion, more than double that of 2024.

The momentum of 2024 was sustained and broadened in 2025, underpinned by continued interest rate easing, improving debt market conditions, resilient hotel operating performance across most of Europe and a strong supply of investor capital.

Lukas Horch, associate at HVS Hodges Ward Elliott and co-author of the report

Single asset transactions made up nearly 70% of total transactions, totalling 411 hotels and reaching a record high volume of €15.6 billion, the strongest year ever recorded in Europe. The three most liquid European single asset markets in 2025 were the UK (€3.4 billion), France (€3.0 billion) and Spain (€2.1 billion). Germany, Czechia and Austria also saw significant transaction volumes.

In terms of cities, London overtook Paris as the most liquid single asset market in Europe in 2025, with a total volume of €1.8 billion, up 78% on the previous year. The year’s most notable transactions included the W London (brokered by HVS Hodges Ward Elliott), the Holiday Inn Kensington and the Novotel London West. Paris saw single asset transaction volumes reach €1.6 billion, up 13% on 2024, driven by the sale of the Hotel des Grands Voyageurs and Pullman Paris Montparnasse.

Europeans were the most active buyers of single assets in 2025, as usual, accounting for 81% of transaction activity, with real estate investment companies being the largest capital movers and shifting €8.9 billion of single asset acquisitions and disposals. Owner-operators were the largest net buyers of single assets at €1.7 billion.

Portfolio volume remained fairly steady in 2025, recording a 3% increase in volume to €7.0 billion. The UK, which had previously dominated the portfolio landscape due to several key deals in 2024, saw volumes fall by €2.2 billion, while Sweden, Greece, Germany and Denmark all recorded strong increases in portfolio deals. The number of hotel portfolios transacted increased by 22%, although the total number of hotels per deal decreased by 11%, highlighting a trend towards smaller, more focussed portfolios.

London recorded the highest volume of portfolio deals, at €487 million, although this represented only a quarter of 2024’s recorded volume. Athens was second in the portfolio rankings, with a volume of €271 million, followed by Paris at €267 million.

European investors were also the largest portfolio buyers of 2025, although with acquisitions of €5.8 billion and sales of €5.7 billion, their volume remained reasonably neutral. North American buyers took top slot as the largest net buyers, recording net portfolio acquisitions of €599 million. Owner-operators were the strongest portfolio investors at €3.3 billion, followed by real estate investment companies (€1.7 billion). Private equity investors decreased their activity, although remained the highest net buyers, reaching €564 million.

The tailwinds that drove hotel investment activity in Europe during 2025 had remained broadly intact at the start of 2026. However, the conflict in the Middle East has now introduced a new layer of complexity to the European hospitality landscape, acting as both an operational headwind and an unexpected catalyst for regional demand.

A substitution effect is emerging as global travellers redirect their itineraries towards perceived safer alternatives in Europe. This trend is likely to strengthen the longer the instability persists in the Middle East, and 2026 may therefore become the year of short-haul travel.

Gauthier Champlong, senior associate at HVS Hodges Ward Elliott and co-author of the report

A copy of the 2025 European Hotel Transactions report by Gauthier Champlong and Lukas Horch can be downloaded here.