- Athens hotels had the highest value growth in Europe in 2024, according to the Hotel Valuation Index (HVI) of global hotel consultancy HVS. It is noted that Athens has maintained this performance for the third consecutive year.
Specifically, the value of hotels in Athens in 2024 increased by 11.8%. HVS analysts attribute this leadership of the Greek capital’s hotel market to the positive growth of the RevPAR index (revenue per available room) and the continued investment interest.
It is noted that the value of Athenian hotels has shown a Compound Annual Growth Rate (CAGR) of 6.1% since 2015, confirming the city’s momentum in investments in the hospitality sector.
According to the data, Southern Europe saw the strongest growth in hotel values, with an almost full recovery to 2019 levels. Eastern Europe, while lagging behind the rest of the region, saw the second strongest growth as its recovery strengthened.
Hotels in Lisbon, Madrid, and Edinburgh benefited from a strong influx of leisure visitors, placing them behind Athens, with their values rising between 6% and 8%.
German cities saw a slow but steady return of demand for corporate travel and exhibition participation, which helped hotel values increase by 4.8% in Munich and 3.4% in Berlin.
Hotels in Paris remain the most expensive in Europe, at the top of the HVI valuation table, followed by London, Zurich, Rome, Florence, and Geneva.
+2% value of European hotels in 2024
At the European level, despite the complex geopolitical and economic context, hotel values in Europe increased by an average of 2% in 2024, year-on-year, as revenue per available room (RevPAR) remained mostly positive and results were broadly stable, while the reduction in debt costs also contributed.
“The continued desire for European travel places the region firmly at the centre of the world in terms of tourist attractiveness, with more than 50 million more overnight stays in 2024 compared to 2023, almost half of which were international visitors,” said report co-author Margherita Rivetti, consulting and valuation analyst at HVS London.
Reversal in hotel investment trends
Hotel groups, which were the biggest buyers in 2023, turned into the biggest sellers in 2024, selling €4.3 billion worth of hotel properties. At the same time, private equity funds took a leading role in the markets, investing a total of €5.3 billion in the sector.
European investors continued to be the most active in acquisitions and divestments of hotel real estate in Europe, representing almost 70% of the total transaction volume. Their acquisition activity increased by 45% compared to the previous year.
Strong return of investors from North America to Europe
At the same time, North American investors made a dynamic return, covering 25% of the hotel real estate purchases in Europe, with a significant increase from 2.2% in 2023 to 7.2% in 2019.
London returned to first place as the hotel market with the most liquidity in Europe, recording transactions of almost 3 billion euros, more than double compared to the previous year.
Paris maintained second place, with a total transaction volume of 1.5 billion euros, recording an increase of two-thirds compared to 2023.
Spanish cities also showed strong liquidity, with Barcelona recording transactions of 444 million euros and Madrid following with 440 million euros.
Tariffs and inflation
HVS warns that while the outlook for European hotels remains relatively strong, a weakening dollar would be detrimental given the importance of the US as a source of market, while the trade war between the US and Europe could cause inflation to re-emerge.
In addition, as HVS London CEO Sophie Perret points out, geopolitical changes such as the collapse of the transatlantic alliance (NATO) could have a significant impact on the hotel industry in the future. The disintegration of long-standing Western alliances adds a sense of uncertainty, he points out.
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