This was a significantly better first result than in the same period of 2022 (784 million euros) and 2023 (369 million euros). The market thus continued its recovery and recorded its highest half-year value since the beginning of the interest rate turnaround.
With a share of 8 percent of the total commercial investment volume, hotel investments significantly exceeded previous years. The second quarter of 2025 in particular stood out with a volume of around 546 million euros – an increase of 92 percent compared to the first quarter and the strongest quarterly result since Q2 2021.
Momentum driven by large-volume individual transactions
Earnings were significantly influenced by large-volume deals. Particularly noteworthy is the sale of the 5-star Mandarin Oriental hotel in Munich, the transaction of which alone amounted to around 150 million euros. Further transactions in the range of 50 to 100 million euros – including several international individual deals – ensured that around 64 percent of the total volume was generated in the upper star segment. The average ticket size thus increased compared to the previous quarter and was over 22 million euros. The focus of investments was on the top 7 locations, especially Munich (261 million euros) and Berlin (136 million euros). Overall, 65 percent of the total volume was accounted for by the A-cities, which underlines the focus on established hotel locations.
Private investors dominate – foreign buyers with a high proportion
The most active group of buyers is once again private investors and family offices, which invest primarily in luxury and upper mid-range hotels with a market share of 33 percent. The high proportion of foreign investors, which accounts for around 61 percent of the transaction volume, is striking. This underlines the regained confidence of international investors in the German hotel market. It can be said that despite net outflows of funds from the funds, core capital must still be invested. Nevertheless, diversification is still required in accordance with the fund statutes, so that ultimately the ticket sizes for active core capital have become smaller. Larger core tickets currently require capital from abroad in particular.
Prime yields stable but selective
Prime yields for hotel properties remained stable at around 4.70 to 5.50 percent in the first half of 2025, with core properties in prime locations continuing to enjoy high demand. For the first time, isolated deals break through the mental hurdle of the 20 factor, paving the way for a stronger second half of the year. Value-add and opportunistic strategies remain challenging, as office-to-hotel conversion is the current supreme discipline in implementation.
Sebastian Hoffmann, Associate Director Hotel at Colliers, says: “The first half of the year proved that the transaction market is characterized by strategic M&A transactions at operator level. For the second half of the year, we are actively monitoring transactions in the market. Recent increases in wages and energy costs are reducing EBITDA margins and have a significant impact on the EBITDA to be factored. In principle, however, the situation is to be seen positively, as this window of opportunity lowers the threshold for market entry barriers for new players who want to expand.”
Outlook: Further positive trend expected in the second half of the year
Michael R. Baumann, Head of Capital Markets Germany at Colliers, says: “In view of the ongoing tourism demand, stable operating key figures as well as further expansion plans by existing operators and new concepts, we expect further investments in the second half of the year – including several transactions worth more than EUR 100 million as well as portfolios that are currently being prepared in the market. The consolidation of the hotel market is also likely to lead to further major transactions and acquisitions. If the interest rate environment continues to stabilize, an increasing transaction momentum is to be expected.”
