Hotel Investment Activity Navigates Economic Shifts and Capital Markets

By RadCRE Research · 2026-10-09 · Market Updates

Global hotel investment volume is projected at $8.1 billion in 2025 by CBRE, as markets adapt to evolving economic conditions and financing landscapes [1].

Current State of Global Hotel Investment

The global hotel investment landscape continues to evolve, with significant capital flows and shifting market dynamics. For 2025, CBRE projects a global investment properties volume of $8.1 billion for hotels [1]. This figure underscores the ongoing interest in the asset class despite broader economic adjustments. Navigating this environment requires specialized market intelligence and global connections, which firms like CBRE leverage to assist clients in both acquiring and divesting hotel properties [1]. Services such as Investment Properties, Debt & Structured Finance, Advisory, Valuation, and Research are critical in enabling institutions, individuals, investors, and lenders to maximize their investments [1].

Key Market Fundamentals and Investment Activity

Examining specific regions provides a granular view of current investment trends. In Germany, for the first half of 2026, the hospitality sector recorded an investment volume of €603 million [5]. During this period, 30 hotels and 3,671 rooms were transacted [5]. The average price per room in Germany reached €164,281, with 43% of the investment volume directed towards Upper Midscale Hotels [5]. Prime yields for German hotels (HMA) were observed between 6.0-6.5% [5]. The region also experienced a year-over-year RevPAR growth of +0.1% and a supply growth of -0.2% [5]. Economic indicators for Germany in H1 2026 included a 0.5% year-over-year Real GDP Growth and 2.5% year-over-year Inflation Growth [5].

Financing and Capital Markets

Debt financing continues to play a vital role in hotel transactions. Recently, JLL’s Hotels & Hospitality Group arranged a five-year, $30.8 million refinancing for the 172-key Hyatt House Seattle/Downtown [6]. This extended-stay hotel, owned by Kauri Investments, is strategically located in Seattle's South Lake Union submarket [6]. The financing provides long-term flexibility for the ownership following a recent property renovation and sustained strong operating performance [6]. Such refinancing activities highlight the continued availability of capital for well-performing assets in key markets.

RadCRE Perspective

"The hotel sector, while showing robust investment volumes globally at $8.1 billion for 2025, is clearly in a phase of recalibration. We're observing a divergence where revenue is growing, yet profit isn’t keeping pace, as noted by CoStar for 2027 trends [2]. This implies a tightening margin environment for operators, which savvy investors must factor into their underwriting. The German market, with its H1 2026 investment volume of €603 million and prime yields of 6.0-6.5%, offers a tangible example of value being sought. The average price per room at €164,281, with significant investment in upper midscale hotels, suggests a preference for resilient, demand-driven assets. Our focus at RadCRE remains on identifying value-add opportunities and distressed assets where operational efficiencies and strategic capital deployment can unlock significant returns, especially in markets demonstrating stable RevPAR growth amidst inflation."

Tags: hotel investment sales, CRE financing, hotel cap rates, RadCRE Market Update