Last year marked a turning point for the European hotel investment market with transaction volume surging 62% year-on-year, the highest level recorded since 2019, according to our latest HVS European Hotel Transaction Report.

Buying and selling activity was fuelled by easing interest rates and abundant funding from private equity investors, most notably for large portfolios deals, giving a total transaction volume for the year of €17.4 billion, a rise of €6.7 billion on 2023 levels.

Hotels across Europe fetched an average price of €29 million, up 5% on the previous year, with the average price per room reaching €215,300, up 9% on 2023, and around 5% higher than in 2019.

The UK was the most active country in terms of total asset activity by volume, with 36% of deals, followed by Spain (15%), France (12%) and Italy and Germany taking a 6% share each while London, Paris and Madrid topped the table in terms of city transactional activity.

London retained its position as Europe’s most transacted city, with €3 billion in deals—matching the combined total of the next five most active cities. This was largely driven by major portfolio transactions, reinforcing London’s status as a key global investment hub, commented report co-author Gauthier Champlong, an associate at HVS Hodges Ward Elliott.

Private Equity investors proved the most active investor type in 2024, buying and selling nearly €8.6 billion-worth of assets – an increase of more than 300% on 2023, followed by owner-operators who transacted €7.8 billion-worth of properties, up 90% on the previous year.

Single asset transaction volume totalled €10.5 billion helped by interest rate cuts across European central banks and strong hotel trading fuelling investor appetite. Paris was the most liquid single asset city market in 2024, with the Olympics prompting much of its €1.4 billion activity. Some of the largest deals in the French capital involved the Mandarin Oriental Paris, the Pullman Paris Eiffel Tower and the Hilton Paris Opera.

London ranked second in terms of single asset transaction volume, with deals reaching €1 billion, followed by Madrid, Venice and Athens. Notable deals in London involved the Six Senses in Bayswater and The Standard in King’s Cross.

Portfolio transaction volume totalled €6.8 billion in 2024, significantly up on 2023 levels. Around half of portfolio deals were in secondary cities, notably in Spain, France, Germany and Belgium. London recorded the highest volume with €1.9 billion in portfolio transactions, followed by Amsterdam with €240 million.

As we move further into 2025, the availability and cost of financing will remain a focal point for hotel investors. With interest rates expected to decline further, capital markets should see a resurgence in liquidity, further boosting transaction volumes across key European markets, concluded report co-author Matthias Hecht, associate director with HVS Hodges Ward Elliott.

While refinancing challenges persist, banks and alternative lenders have demonstrated greater flexibility in restructuring debt, and hotels continue to outperform other real estate classes in investor preference.

A copy of the 2024 European Hotel Transactions report by Gauthier Champlong, Lukas Horch and Matthias Hecht can be downloaded here.

About HVS

HVS, the world’s leading consulting and services organization focused on the hotel, mixed-use, shared ownership, gaming, and leisure industries, was established in 1980. The company performs 4,500+ assignments each year for hotel and real estate owners, operators, investors, banks and developers worldwide. HVS principals are regarded as the leading experts in their respective regions of the globe. Through a network of some 60 offices and more than 300 professionals, HVS provides an unparalleled range of complementary services for the hospitality industry. hvs.com.

Gauthier Champlong
Associate
HVS