European hospitality sector outlook 2024

Leisure has been the primary leader of the recovery and investors will continue to hunt for opportunities in this sector, especially with a value-add angle

In addition to resorts, the travel demand is growing rapidly in primary and second-tier urban markets with strong cultural offerings, allowing for longer season and more balanced mix of source markets. This is likely to attract investors who want to benefit from the long-term growth of leisure travel but also want to avoid the challenges with seasonality and the complex operation of resorts.

Key takeaways

• The pressure on wages, lack of staff, and rising operating costs is deepening investor interest into the extended stay sector that is less labour-intensive;
• Luxury hotels have proven to be an effective hedge against inflation and economic downturns with the additional benefit of owning a distinctive physical asset;
• With passenger movements now exceeding pre-pandemic levels, airport hotels are recovering and could offer promising investment prospects.

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