Over the last decade the Spanish hotel market has been one of the best performing in Europe as it benefited from the growth in leisure tourism and resorts among a wider pool of investors.
That interest doesn’t seem to have cooled judging by 2025’s numbers with Colliers reporting that 2025 closed with a hotel investment volume of €4.275 billion and 194 transactions.
But what does this continued popularity mean for those trying to either get into the market or expand their brand presence?
"The Spanish owner operators are currently very cash rich," said Valerie Schuermans, CDO Western Europe at Radisson Hotel Group speaking on a panel at MIPIM.
"Is it mispriced? Time will tell, but we definitely see that the competition is very fierce, and it's creating a very interesting and intriguing market dynamic."
Spain has a long tradition of family owner-operators and the Colliers report found that domestic investors enjoyed a sizeable portion of the deal activity with a 72 per cent share of transactions and 63 per cent of total investment volume (€2.673 billion).
Sami Mendil, global head of real estate at B&B Hotels Group agreed: "Competition is so fierce," he said referring to southern Europe.
The German market
From one hot market to another that is currently underperforming. German hotel investment is struggling for a number of reasons – some relating to hotels the other to the general economic sentiment.
The popularity of the lease model and the financial struggle of white label operators – exemplified by the insolvency of Revo, point to a potential structural change.
“I think the opportunity lies in the fact that the institutional investors will assess the quality of the debt differently, so that the rent levels and the other covenants are put more in an equation where probably the rent level itself [is] valued differently,”
“I do believe that it will help us, especially on those lease negotiations that we have in those prime cities for flagship properties. It will be in our advantage for sure, because we did feel that there was a very fierce competition with white legal operators.”
Henry Simpson, CEO of Sohoma International said that although the German economy was an issue, the market had proven resilient over the years.
"Germany is going a bit down, down the chute at the moment, the economy is not right, but it has always had strong returns, and the rebound will come one day.
So I think Germany actually [...] will rebound, when is the question? But I would definitely look if there's cheap hotels to look at in great cities, location, unique. That's the place you should invest.