European Hotel Deals Surge as Investors Shun Office Real Estate

Europe’s pace of hotel and short-term rental dealmaking has accelerated lately. Recent headline deals include Blackstone buying the UK’s Village Hotels for a reported $1 billion and Trinity Investments’ bid to acquire $1.5 billion in hotel assets across Europe within the next three years.

In the UK alone, the first half of this year produced the highest volume of British hotel deals in nearly a decade, according to Savills. The value of deals in the sector reached $3.85 billion in the six months to June, an increase of 35% compared with the whole of 2023.

In Europe overall, global hotel groups are taking advantage of rising interest from investors, owners, and banks. In April, Marriott said it would add nearly 100 hotels by 2026, and IHG said it would add 100 hotels in Germany. 

Europe hostel chain A&O is set to invest $500 million to expand across Europe, while Pygmalion Capital is working on two portfolio transactions in Southern Europe for about $150 million.

Earlier this month, Room Mate Hospitality & Leisure, a Madrid-based hotel operator, bought the Staying Valencia brand, its management company, and lease