New benchmarks in the hotel real estate market: Serviced apartments on the rise – investment market gains momentum

The hotel real estate market is facing a phase of selective growth, in which efficient operating models, strong micro-locations and economically resilient operator structures are the key success factors for 2026. This was the conclusion reached by Martin Schaffer, Managing Partner at mrp hotels, Hannah Struck, Senior Asset Manager at mrp hotels, Josef Vollmayr, Co-CEO & Co-Founder of Limehome, Heiko Imiela, Research Consultant Professional at Berlin Hyp/LBBW, and Isabella Doennig, Senior Asset Manager at Swiss Life Asset Managers, at the online panel “mrp hotels quarterly”. The experts discussed current developments in the hotel real estate market and gave a comprehensive insight into market dynamics, key performance indicators and forward-looking trends.

Macroeconomic environment: stabilisation despite high service inflation

The economic conditions remain tense. Although the ECB’s interest rate policy provides planning security, long-term financing costs continue to rise. The persistently high service inflation is having a particularly negative effect. The drivers are rising personnel costs, especially in the transport and hotel and catering sectors.

“We are seeing a slow stabilisation, but inflation in the tourism-related segments remains stubbornly high – a factor that is slowing down the recovery,” summarised Heiko Imiela, Research Consultant Professional at Berlin Hyp/LBBW. Despite weak consumer confidence and a renewed increase in the savings rate in the euro area, international travel continues to grow: In the first half of 2025, 690 million international travellers were counted – an increase of 5 per cent.

Asset Management Analysis: Moderate Growth with Continued Challenging Rate Dynamics

The performance data of the properties managed by mrp hotels in asset management from January to September 2025 show moderate revenue growth in a challenging market environment. Room occupancy increased by 2.3 percent and the average rate by 2.8 percent – as a result, RevPAR increased by 5 percent. “Nevertheless, the implementation of higher rates – especially in Germany and Austria – remains difficult. Many hotels had to adapt their pricing strategy in order to initially secure a solid base occupancy,” says Hannah Struck, Senior Asset Manager at mrp hotels.

The upper-upscale and luxury segment developed above average. It benefits from robust leisure travel demand, low price sensitivity and a stable international guest mix. At the same time, personnel, energy and goods costs continue to rise, which makes efficient structures indispensable.

According to Struck, flexibility and agility are increasingly becoming a competitive factor. Operators who dynamically adapt workforce structures, service offerings, or sales strategies achieve measurably better results. For the fourth quarter of 2025 and 2026, many hotels are cautiously optimistic about moderate but stable growth.

Investment market: Revival with focus on operator quality and selective deals

The hotel investment market will experience a noticeable revival in 2025: The European transaction volume rose by around nine percent in the first nine months. Portfolio adjustments, refurbishments and CapEx-intensive properties continue to characterise the offering, especially in the high-priced segment.

Institutional investors are paying more attention to the creditworthiness, reporting obligations and reliable forecasts of operators. “As an investor, we make advance payments – which is why we need partners who perform sustainably and report transparently,” emphasises Isabella Doennig, Senior Asset Manager at Swiss Life Asset Managers. However, the purchase price determination remains challenging, as price expectations often diverge.

According to Doennig, attractive opportunities arise above all in segments such as serviced apartments or mixed-use properties, which enable flexible usage concepts. At the same time, banks are tightening their financing conditions, for example through higher requirements for rent coverage ratios and more critical business plan reviews. Alternative forms of financing are gaining in importance and could bring additional movement to planned transactions.

Serviced Apartments: High-efficiency segment with sustainable growth

Serviced apartments are currently one of the most dynamic and high-performing areas of the hotel real estate market. Efficient operating models, high occupancy rates and a broad target group approach make it a stable alternative to the classic hotel industry.

“We operate in the same market as hotels – but with a completely different operating model,” explained Josef Vollmayr, Co-CEO of Limehome. Automation and centralized processes enable significantly lower personnel costs and operating costs of only around 25 percent.

With an average occupancy rate of 90 percent across a Europe-wide portfolio and over 12,000 units under contract, Limehome continues to see enormous growth potential. Demand for flexible, scalable concepts is growing faster than the pipeline – a trend that is giving the segment a tailwind.

Outlook: 2026 as a year of strategic adjustment

The hotel real estate market is in a phase of readjustment. High financing costs and rising operating expenses pose challenges for operators and investors. Nevertheless, mrp hotels expects a cautiously positive development for 2026. “Good locations work – everything else is evaluated more selectively,” emphasized Martin Schaffer, Managing Partner at mrp hotels. The ongoing consolidation opens up opportunities for agile, economically stable concepts. His conclusion: “2026 will be a promising year for all those who consistently adapt their strategy to market reality and actively take advantage of the opportunities that arise.”