As the European hotel market continues to evolve, a new crop of destinations is emerging as hotspots for hotel investment. According to a 2025 European Hotel Investor Intentions Survey by CBRE, cities like Rome, Lisbon, and Athens are challenging traditional favorites like London and Paris for the attention of international hotel investors.
Market Fundamentals Drive the Shift
So, what’s driving this shift? Market fundamentals are playing a significant role, with attractive price points, growing demand, and increasing supply all contributing to a surge in investor interest. For example, Rome’s strong tourism sector, supported by its rich history and cultural attractions, has made it an attractive destination for hotel investors. The city’s luxury hotel segment has also seen significant growth, with new brands and developments entering the market.
- Rome offers a unique blend of cultural and historical attractions, making it an attractive destination for tourists and investors alike.
- The city’s strong tourism sector is supported by a range of world-class attractions, including the Colosseum, the Vatican, and the Pantheon.
- Rome’s luxury hotel segment has seen significant growth, with new brands and developments entering the market.
Lisbon, Portugal: A City on the Rise
Lisbon, the Portuguese capital, has continued to impress investors with its blend of historic charm, scenic coastline, and growing global connectivity. The city’s positive tourism outlook and improving infrastructure have fueled confidence in its hospitality sector, making it an increasingly attractive destination for tourists and investors.
- Lisbon’s historic neighborhoods, such as Alfama and Bairro Alto, offer a unique blend of cultural and architectural heritage.
- The city’s scenic coastline and beaches, such as Cascais and Estoril, make it a popular destination for tourists and locals alike.
- Lisbon’s improving infrastructure, including its airport and public transportation system, has made it easier for visitors to explore the city.
Athens, Greece: A New Player in the Market
Athens, the capital of Greece, has made a notable entry into the top ten most attractive hotel investment destinations. The city’s steady growth in international arrivals and a rapidly expanding luxury segment have gained traction among investors looking to diversify their portfolios beyond traditional Western European hubs.
| Key Features | Benefits |
|---|---|
| Steady growth in international arrivals | Increased tourism revenue and job creation |
| Rapidly expanding luxury segment | Growing demand for high-end hospitality |
| Cultural richness and affordability | Competitive advantages in the market |
“Athens is a city that has something for everyone. From its stunning ancient ruins to its vibrant nightlife and delicious cuisine, there’s no shortage of excitement and adventure. And with its growing luxury segment, Athens is becoming an increasingly attractive destination for high-end hotel investors.” – CBRE
A Value-Add Strategy for Hotel Investors
Investors are looking beyond turnkey acquisitions, focusing instead on rebranding, refurbishment, and repositioning properties to meet rising consumer expectations. This trend is especially visible in cities like Athens and Lisbon, where boutique and lifestyle hotels are booming.
- Rebranding and refurbishment can help hotels appeal to new markets and increase their competitiveness.
- Repositioning properties can help hotels take advantage of new trends and consumer preferences.
- Boutique and lifestyle hotels are booming in cities like Athens and Lisbon, offering hotel investors new opportunities.
Geographical Broadening of Interest
More investors are venturing into new territories, recognizing that Europe’s hospitality landscape is evolving. Established gateway cities like London and Madrid continue to lead in total investment volume, but the real story of 2025 is the geographical broadening of interest.
The Appeal of Luxury and Upper-Upscale Hotels
Investors drawn to cities like Rome, Lisbon, and Athens are often those with a strong interest in luxury and upper-upscale hotels. These segments remain the most attractive across the continent, and investors are looking for opportunities to capitalize on this trend.
The Future of Hotel Investment in Europe
Rome, Lisbon, and Athens are poised to become key players in Europe’s evolving tourism economy.
