European Hotel Investor Compass

Madrid and Barcelona top the list of cities where investment interest is strongest, followed by Paris and Rome. Contributing to this, Barcelona saw the biggest increase in attractiveness relative to 2022 (+10%), while Lisbon saw an 8% increase and Madrid a 7% rise. Dublin saw a 3.1 decrease in attractiveness. 

A substantial 78% of the investors surveyed intend to deploy the same or more capital into European hotels this year compared to pre-pandemic 2019 levels. Value-add opportunities are being aggressively targeted, with 92% of respondents focused on this strategy of acquiring assets requiring repositioning or moderate capital expenditure. Nearly half of investors are planning to be net buyers in 2024.

Findings of the survey also point to the premium investors expecting to pay for hotels with superior ESG credentials. On average, respondents indicated they expect to pay a 5.5% premium versus non-certified properties for those achieving the highest level of ESG certification such as BREEAM Outstanding or LEED Platinum ratings.

There is a strong pull towards investment in upscale hotel segments, including luxury and upper-upscale, which are seeing the biggest increases in investor demand versus 2019, 53% and 46% respectively.

When asked about the level of attractiveness of accommodation types, investors indicated that the most attractive were resorts (74%) and serviced apartment (59%) properties.