The hotel real estate market is becoming more selective - stable cash flows are becoming a key criterion

According to Matthias Reith, the economic conditions remain shaped by geopolitical developments and their impact on energy prices. These influenced both the inflation trend and the monetary policy decisions of the European Central Bank.

"Uncertainty remains the decisive factor at the moment. The development of inflation and interest rates is determined less in Frankfurt than by the geopolitical situation," says Reith.

Reith expects a moderate economic recovery in the second half of the year. Although rising energy prices and restrained consumer sentiment weighed on economic development, tourism is likely to continue to develop comparatively robustly. Many households would save on consumption, but not necessarily on travel.

The operating performance in hotel businesses was positive in the first half of 2026. In Germany, the number of overnight stays rose by 1.4 percent from January to May compared to the previous year, and in Austria by 2.4 percent. In both markets, growth was largely driven by a strong May. In Austria, Vienna and Carinthia in particular as well as the resumption of international demand – especially from the USA – provided positive impetus. In Germany, a regionally differentiated picture emerged: While North Rhine-Westphalia in particular contributed to growth with a significant increase in overnight stays and the trade fair locations Düsseldorf and Cologne contributed to growth, Berlin and Munich fell short of the previous year's level.

According to Martin Schaffer, however, the transaction and rental market is showing an increasingly heterogeneous development: "Deals are possible. Today, however, they can only be achieved if the location, operator, sponsor quality, business plan and financing are equally convincing."

According to mrp hotels, the consequences of the Revo insolvency continue to have an impact on the market. Changes of operator, renegotiation of existing lease agreements and the selection of new operators continue to occupy owners and investors. According to Schaffer, numerous projects show that contract controlling, the formation of FF&E reserves and active asset management have not been consistently implemented in many places. Many owners would have to perform their asset management tasks more consistently.

According to Norman Schaaf, the framework conditions for project developments have changed significantly in recent years. Today, new hotels are mainly being built where existing properties can be revitalized or repositioned as part of mixed-use neighborhoods.

"Especially in inner-city locations, we are now checking much more frequently whether existing office or retail properties are suitable for hotel use or mixed-use concepts," says Schaaf.

Hotels could meaningfully complement various uses and at the same time support the financing of district developments. CELLS continues to observe high demand for hotel uses, especially in good inner-city locations. At the same time, it is evident that the attractiveness of projects is increasingly oriented towards their micro-location. While hotels in prime locations continue to develop well, implementation in less attractive locations is becoming much more challenging.

According to the panelists, the financing of hotel properties remains possible in principle. However, banks and alternative financiers are examining projects in a much more differentiated way than they were a few years ago. In addition to location and operator quality, the financing structure and the plausibility of the business plans are becoming increasingly important.  

Peter Anthuber observes that traditional bank financing and private debt solutions are increasingly complementary. While banks are particularly active in the case of established existing properties with long-term operator contracts, alternative forms of financing are mainly used for more complex project developments, revitalisations or higher financing ratios.

"Capital is basically available – both in banks and in debt funds. Today, it is crucial that the location, operator, business plan and financing structure are convincing," says Anthuber.

According to the financing expert, there are currently attractive financing options, especially for refurbishments and portfolio transformations. In contrast, classic new hotel buildings without an operating contract or resilient pre-letting remain challenging. At the same time, private debt is gaining in importance as a supplement to traditional bank financing – especially when greater flexibility or faster decisions are required.  

The evaluation of the asset management portfolio managed by mrp hotels with around 20 hotels in the DACH region shows a mixed picture for the first half of 2026. Although demand remained stable and capacity utilization increased slightly, the development of average rates remained subdued. Rising personnel, energy and cost of goods costs could not be fully compensated for and weighed on profitability. Persistently shorter booking windows also made price control more difficult and reduced planning security.

"Demand remains stable, but at the same time the pressure on profitability is increasing. Since higher costs can only be compensated for to a limited extent through the room rate, active revenue management, consistent cost control and digital processes are becoming increasingly important," says Hannah Struck, Senior Asset Manager & Consultant at mrp hotels.

Digital applications and AI are therefore becoming more important for many operators. However, their economic benefits do not arise solely from new technologies, but from their consistent integration into processes and operating procedures. Individual hotels are often faster than large hotel chains due to shorter decision-making paths. In addition, the strategic development of the hotel product is coming more into focus. Operators are increasingly examining where personal service adds value and which processes could be digitally supported or automated in the future.  

The panelists expect operator quality, resilient cash flows and professional asset management to continue to shape the development of the hotel real estate market in the coming months. At the same time, revitalization, portfolio transformation and alternative forms of financing are likely to gain in importance. For owners, investors and project developers, the economic quality of a project is thus becoming more important than short-term growth assumptions.  

"The challenges are not getting smaller. This makes it all the more important to actively support hotels along their entire life cycle – from the choice of operator to financing and ongoing asset management. In the future, it will be even more important to decide how successfully a hotel property develops," concludes Martin Schaffer.