The hotel investment market across the UK and Europe is riding a strong wave of momentum in 2025. According to the latest Hilltop Tracker H1 2025 report by Hilltop Hospitality Advisors and Hospitality People Group, hotel transaction volumes soared to €11.7 billion in the first half of 2025 — a 16% year-over-year increase from €10.1 billion in H1 2024.
This semi-annual snapshot reveals an active, evolving landscape for hotel investors, highlighting new trends, top-performing markets, and shifting investor behaviours.
📈 Investment Activity: Rising Volumes, Growing Opportunities
- 198 transactions were publicly announced across single assets, portfolios, and M&A deals, compared to 179 in H1 2024.
- Over €15 billion of hotel stock is currently in open-market sales — indicating 2025 could break historic transaction records if deals close.
- The “flight to luxury” continues, with six deals surpassing €1 million per key, including development and conversion assets.
🌍 Top Markets and Cities
The UK and Spain maintained their positions as the most active markets. However, Spain’s share slipped to 16%, down from 26%, while Germany surged into third place:
Country | % of Deals (H1 2025) |
UK | 24% |
Spain | 16% |
Germany | 12% |
France | 11% |
London, Paris, and Hamburg led the city rankings, followed by Barcelona, Dublin, and Prague — with the latter three showing upward momentum. Rome, once a hotspot, saw a relative decline.
💼 Who’s Buying, Who’s Selling?
Owner-Operators and Real Estate Investment Managers (REIMs) dominated acquisitions:
- Owner/Operators: 41% of buyer activity
- REIMs: 19%
- Private Equity (PE): 17%
🏨 Urban vs. Resort: Both on the Rise
While urban assets still make up the majority of transactions (72%), resort hotel deals rose to 28%, reflecting growing investor appetite for leisure and experiential travel properties.
🧾 Deal Structures and Trends
- Vacant possession (VP) deals led at 41% of total transactions.
- Lease deals climbed to 23%, likely influenced by the European Central Bank’s rate reductions.
- Development and conversion projects represented 15% — evidence of opportunistic strategies in repositioning assets.
🔮 Outlook: Will 2025 Set a New Record?
With high levels of capital chasing premium assets and a vast pipeline of properties on the market, 2025 could exceed expectations — but deal execution will depend on resolving pricing mismatches and navigating macro pressures.
For investors, operators, and developers, H1 2025 has affirmed that hospitality real estate remains a resilient, adaptive asset class. And with luxury, resorts, and redevelopment continuing to dominate, the rest of the year is likely to offer plenty more movement.
For a more in-depth analysis and to receive quarterly editions of the Hilltop Tracker, please do get in touch.
Hospitality People Group focuses on assembling leadership teams that are capable of making strategic decisions to reduce risk, improve resilience, and address the challenges organisations face in today’s complex environment by fostering workplace cultures that promote continuous improvement and innovation. This approach helps ensures our clients not only navigate the current landscape, but also position themselves for long-term success.
Dan Akhtar, Managing Director – HPG Advisory Services
+44 208 600 1166 / +44 7808 157796 / [email protected]
Guy Lean, Managing Director – Madison Mayfair
+44 20 8 600 1180 / +44 7813 009787 / [email protected]
Chris Denison Smith, Managing Director – FM Recruitment
+44 20 8 600 1160 / +44 7775 711923 / [email protected]
Andrea Shaw, Director – FM Recruitment
+44 20 8 600 1160 / +44 7714 236469 / [email protected]