mrp hotels quarterly with ECE, numa and Raiffeisen Research
In the exclusive quarterly LinkedIn live update "mrp hotels quarterly", the experts from mrp hotels, together with industry insiders, presented an up-to-date quarterly analysis for the second quarter of 2025 on July 22, 2025. The focus was on the question of how operators and investors can act economically, taking into account the current economic and geopolitical challenges. The experts discussed the difficult framework conditions in the DACH region, cost pressure on project developments, EBITDA pressure on the operator side and rumoured economic uncertainties among hotel operators. Above all, however, the panel sees a lot of potential: For internationally active investors and operators, for example, there are interesting business opportunities in growth markets in northern and southern Europe due to rising room prices and global demand. In addition, there are numerous opportunities in the DACH region through measures such as repositioning or conversion instead of new construction and increasing cost efficiency in development and operations.
Martin Schaffer, Managing Partner at mrp hotels, and Hannah Struck, Senior Asset Manager at mrp hotels, discussed the topic of "Hotel Investment & Operator Market – Risk or Return?" together with Caspar Kraushaar, Project Director Hotel at ECE Work & Live, Sven Küstermann, Director Real Estate Expansion at numa group, and Fabian Blasch, Research Analyst at Raiffeisen Research.
Macroeconomic framework: Rays of hope despite interest rate hurdles
Rising interest rates have increased the pressure on commercial real estate investments since 2022. However, according to the analysis by Fabian Blasch, Research Analyst at Raiffeisen Research, the first signs of recovery are emerging: "Despite the continued higher interest rate level, there are initial signs of stabilisation. Prices have already shown a slight recovery since mid-2024 and the transaction volume in the commercial real estate sector was 21 percent higher in the first quarter than in the same quarter last year. A restrained but palpable optimism is returning." Nevertheless, consumer sentiment, especially in Austria, but also in Germany, remains depressed compared to the EURO zone.
Hotel real estate market: Investors focus on brand power and repositioning
Demand for hotel properties remains high. mrp hotels identifies refurbishments and conversions as the main drivers of growing attractiveness. At the same time, the lack of new projects is leading to rising real estate prices. Transactions such as the acquisition of Mandarin Oriental Munich or the Dalata Hotel Group are examples of the shift towards brand-driven growth. Caspar Kraushaar, Project Director Hotel at ECE Work & Live, emphasizes: "We see a clear focus on European metropolises with high leisure demand and international reach. High rates can be achieved at such locations. Due to the high cost prices, every square metre must be economical."
Operator market in transition: Focus on creditworthiness and transparency
Operator contracts are subject to new/increased requirements: performance tests, termination rights and performance-based adjustment mechanisms characterize new agreements. Investors pay more attention to the economic stability of the operators and their factors when selling. Franchise models offer opportunities, but set clear requirements for the choice of location and operator quality. Sven Küstermann, Director Real Estate Expansion at numa, clarifies: "We see enormous cost pressure from many traditional operators. This makes it all the more important that our model remains lean, technology-based and data-driven. The lease coverage ratio (LCR) must be at least 1.4, otherwise it will not be sustainable for us as operators. This means that operating income must exceed the rent by 40 percent. Otherwise, there will be a lack of sustainable viability for operators and investors."
Market dynamics: Stagnation in DACH, opportunities in Southern Europe
While the number of overnight stays in DACH metropolises, such as Stuttgart, Frankfurt am Main, Munich or Vienna, stagnated or even declined in Q1/Q2 2025, markets such as Copenhagen, Lisbon and Stockholm exceeded the previous year's level.
"We see a lot of opportunities on the market – but we deliberately decide on a few projects. A large number of projects are oriented more towards the developer's perspective than from the operator's point of view. The market has become more realistic. Many conversion topics are not economically viable or not a suitable hotel location," says Küstermann on the selectivity of current expansion strategies. However, the topic of conversion remains one of the growth and opportunity drivers in the operator market. However, the right angle and reliable data are the key here.
Performance: Stable at a high level, but slowed down in the outlook
The evaluation of mrp hotels' asset management portfolio shows strong revenue and earnings growth for H1 2025 (RevPAR: +9 percent year-on-year, GOP per available room +11 percent). However, a sideways movement is expected for the second half of the year: economic uncertainty and the strong presentation from Q4 2024 are slowing growth. "Sustainable operator profitability requires a deep understanding of the micro-location and market cycles, as well as a flexible operating strategy," concludes Hannah Struck, Senior Asset Manager at mrp hotels.
Conclusion: The hotel investment market remains promising
Despite geopolitical risks, rising operating costs and subdued consumer sentiment, the analysis shows that the hotel market is experiencing stable demand and offers a high level of resilience as well as strong brand development prospects. "The combination of technology-supported M&A strategies, product-side repositioning and long-term platform building will continue to make the market an attractive playing field for risk-conscious return-oriented investors in 2025," sums up Martin Schaffer, Managing Partner at mrp hotels.
