Hospitality Real Estate Sector - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Hospitality Real Estate Sector is segmented by Property Type (Hotels and Accommodation, Spas and Resorts, and Other Themed Properties) and Geography. The report offers market size and forecasts for the hospitality real estate sector in value (USD billion) for all the above segments. The report also covers the impact of COVID-19 on the market.

Market Snapshot

 Global Hospitality Real Estate Market Growth
Study Period: 2017-2027
Base Year: 2021
Fastest Growing Market: Europe
Largest Market: Asia-Pacific
CAGR: >10 %

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Market Overview

The hospitality real estate sector is expected to register a CAGR of more than 10% during the forecast period. The hospitality real estate market suffered a hard hit by the global pandemic, as travel restrictions, social distancing, and low mobility rates were implemented during the COVID-19 outbreak. Now the market is in the recovery phase as international travel restrictions were relaxed in some regions, thus resulting in increasing travelers inflow.

Hotels and accommodations hold the largest share in the global market. North America accounts for the highest investments in the hotels and accommodation segment, followed by the Asia-Pacific region. In addition, investors also focus on luxury hotels and resorts in urban areas, which attracts upper-middle class and high-income populations.

Despite the fact that the disruptive pandemic affects investment, flows into the market are uninterrupted. Meanwhile, Europe's hospitality real estate sector experienced the highest number of foreign investments from North America and Asia-Pacific regions. In addition, most of the investments are obtained from private equity, institutional investors, and investment fund entities.

Scope of the Report

The hospitality real estate sector is segmented by property type (hotels and accommodation, spas and resorts, and other themed properties) and geography. The report offers market size and forecasts for the hospitality real estate sector in value (USD billion) for all the above segments. The report also covers the impact of COVID-19 on the market.

By Property Type
Hotels and Accommodation
Spas and Resorts
Other Property Types
By Geography
Asia-Pacific
China
Japan
India
South Korea
Rest of Asia-Pacific
North America
United States
Canada
Rest of North America
Europe
United Kingdom
Germany
France
Russia
Rest of Europe
Middle-East and Africa
Saudi Arabia
United Arab Emirates
Qatar
South Africa
Rest of Middle-East and Africa
Latin America
Brazil
Mexico
Argentina
Colombia
Rest of Latin America

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Key Market Trends

Increasing Investments in the Hospitality Real Estate Sector

Many investors are interested in the hospitality real estate sector despite the disruptions caused by the pandemic. Further growth in investments is supported by a great number of first-time investors stepping into the hospitality sector for better yields and to diversify their portfolios.

In 2021, resort hotels witnessed increasing investments in the hospitality sector. In addition, sales of resort assets reached USD 9.2 billion globally. Furthermore, private equity groups are focusing on increasing investments in the hospitality real estate sector, which accounts for more than USD 25 Billion in 2021 compared to the previous year.

The Asia-Pacific region experienced a resilient market with a strong rebound of investments in 2021 by more than USD 8 billion for the development of the hospitality sector. Meanwhile, the North American region accounts for more than 60% of global hotel investments in 2021, followed by Europe, the Middle East, and Africa (EMEA), and Asia-Pacific (APAC) region.

Furthermore, increasing investments through hospitality Real Estate Investment Trusts (REITs) leverage the market growth by acquiring and managing hotels, motels, luxury resorts, business-class hotels, etc. Some of the major REITs include Apple Hospitality REIT, Summit Hotel Properties, Park Hotels & Resorts, Hersha Hospitality Trust, and Pebblebrook Hotel Trust.

Global Hotel Investment Volume

The United States Experiencing Demand in the Hotel Industry

The United States hospitality real estate sector is in the recovery phase as it has been severely hit by the COVID-19 pandemic. Moreover, significant growth in demand for the hotel industry supports the hospitality sector's growth.

The hotel industry in the country is majorly driven by travelers entering the country from different regions across the globe.

In July 2021, screenings by the Transportation Security Administration (TSA) were increased due to the flow of more than 2 million foreigners into the country.

Furthermore, in November 2021 relaxation of European travel restrictions to the United States increased the demand for hotels in the country. Also, the demand continued with the arrival of the holiday season in the country.

In addition, Thanksgiving week 2021 resulted in robust demand for the hospitality sector as hotel occupancy rates were increased to 53%, and revenue per available room (RevPAR) was 20% compared to the pre-pandemic era of 2019.

The United States Hotel Room Occupancy

Competitive Landscape

The hospitality real estate sector is a competitive market with many players who are already well established in their respective regions. Most of the players are expanding their business by investing strategically in partnerships, acquisitions, etc. Furthermore, hotels and accommodations, luxury hotels, and resorts are the most invested segments in the hospitality real estate sector by the developers. In addition, significant growth in tourism and traveling across the globe leveraging the market growth by grabbing the attention of various investors.

Recent Developments

  • March 2022: OTO Development (fast-growing hotel development and hospitality management company) acquired Best Western Fort Walton Beach in the Florida Panhandle from Marcus & Millichap. OTO Development is a part of the Johnson Group, which develops, owns, and operates select-service hotels across the United States.
  • February 2022: Noble Investment Group entered a strategic partnership with Host Hotels & Resorts, Inc. (the largest lodging real estate investment trust). This partnership enables a USD 150 million capital commitment and provides Nobel with extended-stay hotel opportunities sourced through Host’s channels
  • January 2022: The Georgetown Company (develops and invests in residential, commercial, and mixed-use properties) acquired the Hutton Hotel in Nashville. This is the company's first purchase through its USD 1 billion hospitality platform in partnership with the hotel management company First Hospitality.

Table of Contents

  1. 1. INTRODUCTION

    1. 1.1 Study Deliverables

    2. 1.2 Scope of the Study

  2. 2. RESEARCH METHODOLOGY

  3. 3. EXECUTIVE SUMMARY

  4. 4. MARKET INSIGHTS AND DYNAMICS

    1. 4.1 Market Overview

    2. 4.2 Market Dynamics

      1. 4.2.1 Market Drivers

      2. 4.2.2 Market Restraints

      3. 4.2.3 Market Opportunities

    3. 4.3 Insights into Technological Innovation in the Hospitality Real Estate Sector

    4. 4.4 Insights into Urban Commercial Property Prices and Recent Hospitality RE Transactions

    5. 4.5 Industry Value Chain Analysis

    6. 4.6 Porter's Five Forces Analysis

    7. 4.7 Impact of COVID-19 on the Market

  5. 5. MARKET SEGMENTATION

    1. 5.1 By Property Type

      1. 5.1.1 Hotels and Accommodation

      2. 5.1.2 Spas and Resorts

      3. 5.1.3 Other Property Types

    2. 5.2 By Geography

      1. 5.2.1 Asia-Pacific

        1. 5.2.1.1 China

        2. 5.2.1.2 Japan

        3. 5.2.1.3 India

        4. 5.2.1.4 South Korea

        5. 5.2.1.5 Rest of Asia-Pacific

      2. 5.2.2 North America

        1. 5.2.2.1 United States

        2. 5.2.2.2 Canada

        3. 5.2.2.3 Rest of North America

      3. 5.2.3 Europe

        1. 5.2.3.1 United Kingdom

        2. 5.2.3.2 Germany

        3. 5.2.3.3 France

        4. 5.2.3.4 Russia

        5. 5.2.3.5 Rest of Europe

      4. 5.2.4 Middle-East and Africa

        1. 5.2.4.1 Saudi Arabia

        2. 5.2.4.2 United Arab Emirates

        3. 5.2.4.3 Qatar

        4. 5.2.4.4 South Africa

        5. 5.2.4.5 Rest of Middle-East and Africa

      5. 5.2.5 Latin America

        1. 5.2.5.1 Brazil

        2. 5.2.5.2 Mexico

        3. 5.2.5.3 Argentina

        4. 5.2.5.4 Colombia

        5. 5.2.5.5 Rest of Latin America

  6. 6. COMPETITIVE LANDSCAPE

    1. 6.1 Overview (Market Concentration and Major Players)

    2. 6.2 Company Profiles

      1. 6.2.1 Wyndham Hotel Group LLC

      2. 6.2.2 Choice Hotels International Inc.

      3. 6.2.3 Marriott International Inc.

      4. 6.2.4 Hilton Worldwide Holdings Inc.

      5. 6.2.5 InterContinental Hotels Group

      6. 6.2.6 Sonesta RL Franchising Inc.

      7. 6.2.7 Best Western International Inc.

      8. 6.2.8 G6 Hospitality LLC

      9. 6.2.9 Aimbridge Hospitality

      10. 6.2.10 Radisson Hospitality Inc.

      11. 6.2.11 The Georgetown Company

      12. 6.2.12 Host Hotels & Resorts LP

      13. 6.2.13 OTO Development

      14. 6.2.14 Apple Hospitality REIT Inc.

      15. 6.2.15 Atrium Hospitality Company

    3. *List Not Exhaustive
  7. 7. MARKET OPPORTUNITIES AND FUTURE TRENDS

  8. 8. APPENDIX

**Subject to Availability

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Frequently Asked Questions

The Hospitality Real Estate Sector market is studied from 2017 - 2027.

The Hospitality Real Estate Sector is growing at a CAGR of >10% over the next 5 years.

Europe is growing at the highest CAGR over 2021- 2026.

Asia-Pacific holds highest share in 2021.

InterContinental Hotels Group, Hilton Worldwide Holdings Inc., Marriott International, Inc., Choice Hotels International, Inc. , Wyndham Hotel Group, LLC. are the major companies operating in Hospitality Real Estate Sector .

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