Hotel investment: individual assets and national investors as key players in 2024

Hotel investment in Spain closed 2024 with figures that highlight its strength and appeal. According to data presented by CBRE, total investment in this segment reached €3.35 billion, consolidating the sector as one of the most dynamic within the national real estate landscape. This performance reinforces Spain’s strategic position as a global leader in tourism, a milestone supported by renewed investor interest, particularly from domestic investors, in hotel assets.

The hotel sector, the second-largest segment in capital attraction (with only the ‘living’ sector ahead), represents approximately 30% of total real estate investment, according to the consultancy.

Although the 2024 figure reflects notable dynamism, it remains below the historic record of €4.1 billion reached in 2023, the second-best year for the sector after the €5 billion recorded in 2018. Between 2017 and 2024, Spain accumulated more than €25 billion in hotel investment, maintaining its position on the radar of major investors.

Key hotel investment transactions in 2024

While 2023 was marked by major portfolio acquisitions, the past year saw a predominance of individual asset transactions. A total of 123 operations accounted for 74% of the total volume, approximately €2.5 billion. Among the most notable transactions were the sale of the Hotel Miguel Ángel in Madrid, Six Senses Ibiza, and the AC Hotel Barcelona Forum.

• Hotel Miguel Ángel (Madrid): Acquired by the British fund Millenium Hospitality, this transaction closed at €150 million. The iconic hotel, located on Paseo de la Castellana, will undergo a full renovation to reposition it as a luxury establishment targeting the premium segment.
• Six Senses Ibiza: The Statuto Group completed Spain’s most significant hotel acquisition, with a transaction worth nearly €200 million.
• AC Barcelona Fórum (Barcelona): Located in one of the city’s most dynamic areas, this asset changed hands in a deal valued at approximately €100 million. The hotel will benefit from Barcelona’s continued appreciation as both a tourist and business destination.

Other significant transactions in 2024 also included the sale of assets such as the Hotel Rafael Atocha in Madrid, Labranda Suites Costa Adeje, and Iberostar Las Dalias in Tenerife.

The market also recorded notable portfolio transactions, such as Partners Group’s acquisition of a majority stake in BlueSea, Hyatt’s purchase of the Jewel portfolio (including three hotels in Tenerife), and investments by Banco Santander and the Catalonia group in portfolios featuring hotels in destinations like Tenerife, Menorca, Barcelona, and Málaga.

The rise of national investors

Domestic investors led the market in 2024, accounting for 52% of total investment volume—more than double their participation in 2023. Hotel chains and management firms were the most active, contributing 38% of total investments, while institutional investors, affected by rising interest rates, reduced their participation to 25%, a sharp decline from 70% the previous year.

Luxury: the most sought-after asset

In 2024, over 180 hotel assets changed hands, totaling more than 17,000 rooms. Investment focused mainly on 4- and 5-star hotels, which accounted for 45% and 20% of the total investment, respectively. Luxury assets have gained ground, with notable transactions such as those within the Millenium Hospitality Real Estate portfolio, where Sancus Capital recently entered.

This market polarization has reduced investment in 3- and 4-star hotels, which have lost prominence in favor of both ends of the quality spectrum, according to CBRE.

The rise of urban hotels

Unlike in 2023, the urban segment was the primary recipient of investments in 2024, capturing 53% of total capital compared to 47% for the vacation segment. According to the consultancy, this shift is partly explained by the growing trend of converting office buildings into hotels in urban centers, driven by high accommodation demand and the goal of revitalizing outdated buildings.

Cities such as Barcelona and Madrid led transactions, each accounting for 18% of the total volume, while Málaga stood out with 5%.

Meanwhile, prime hotel yields adjusted downward by 25 basis points, settling at 5% in Madrid and Barcelona and 6% in the islands. This adjustment reflects the positive impact of declining interest rates and the sector’s strong operational performance.

Hotel investment outlook for 2025

The hotel sector enters 2025 with an optimistic outlook. According to Gustavo Cumella de Montserrat, Director of Hotels at CBRE, ongoing sales transactions and interest rate stabilization point to a favorable investment environment. Additionally, greater attention is expected toward emerging destinations, conversion projects, and alternative segments such as branded residences and serviced apartments. The luxury and ultra-luxury market will also continue to be a key pillar for investment.