JLL Forecasts Robust Global Hotel Investment Driven by Debt Market Strength and Capital Availability :: Hospitality Trends

JLL’s 2026 Global Hotel Investment Outlook projects a significant increase in hotel sector investment, supported by strong debt markets, ample capital, and renewed investor confidence, with notable regional trends and opportunities expected worldwide.

2025 Performance and Sector Recovery

JLL’s Hotels & Hospitality Group has released its annual Global Hotel Investment Outlook, forecasting continued growth in global hotel investment volumes for 2026. The report highlights that in 2025, global hotel transaction volumes rebounded, with direct investment rising 22% from the 2023 low point. The Americas led with a 27% increase, while EMEA (Europe, Middle East, and Africa) saw a 4% rise. In contrast, Asia Pacific experienced a 20% decline in transaction volumes, though the region is expected to recover in 2026 due to resilient travel demand and strong performance fundamentals.

The report notes that revenue per available room (RevPAR) growth is slowing after several years of above-average increases, with performance varying across markets. Cities such as Miami have returned to pre-pandemic levels, while others, including San Francisco and some Asia-Pacific markets, saw higher growth in 2025 due to a delayed recovery. This divergence is attributed to differences in recovery pace, business travel trends, and new hotel supply.

In 2025, hotels accounted for about 8% of global commercial real estate investment, surpassing the sector’s long-term average and indicating renewed interest from institutional investors.

Key Drivers for 2026 Investment Outlook

JLL identifies several factors supporting a positive outlook for hotel investment in 2026:

– Global air passenger volumes are projected to grow 4.9% year-over-year, with Asia Pacific leading at 7.3% growth, particularly in India, China, and Vietnam.

– Slower supply growth in major markets is expected to support the performance of existing hotels. Most large U.S. cities have construction pipelines that are below 2% of their existing supply. 

– Debt markets have improved, with increased lender interest and better pricing. Equity capital remains widely available, likely driving more transaction activity.

Regional Investment Trends

Luxury resorts and high-value assets are becoming top targets for investors, due to strong supply-demand dynamics and institutional interest. Upcoming events such as the 2026 FIFA Soccer World Cup and America’s 250th anniversary are expected to boost lodging demand in key cities.

In Asia Pacific, Japan is highlighted as a leader, with Goldman Sachs raising a $500 million fund targeting Japanese hotels. Japan is forecasted to account for 35% to 40% of the region’s hotel transaction volumes in 2026. Singapore and India are also identified as markets with strong investment potential due to their stable environments and growth prospects.

Emerging Investment Themes

The report outlines several trends shaping hotel investment strategy for 2026:

– Uneven RevPAR performance is leading investors to focus on high-quality assets in prime locations. – Improved debt markets are enabling larger transactions, with deals over $250 million expected to increase. – Cross-border capital flows are rising, particularly into UK and European markets. – Private equity firms, with significant available capital, are targeting value-add opportunities, portfolio transactions, and high-quality hotels priced below replacement cost.

Conclusion and Outlook

JLL concludes that the hotel sector’s investment market has reached a turning point, with favorable supply-demand fundamentals, strong debt markets, and high investor confidence aligning to support a sustained investment cycle beyond 2026. The report suggests that these conditions create opportunities for both domestic and international investors to capitalize on sector growth and changing market dynamics.