India’s hotel transaction value rose 197% in the first half of 2026, with regional markets accounting for most activity, while established resorts helped Spain achieve record first-half investment.
India’s hotel investment market nearly tripled in value in the first half of 2026, with destinations beyond its principal metropolitan centres accounting for most transaction activity.
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Spain also recorded its strongest first half for hotel investment, driven by established resort markets and demand for four- and five-star properties.
The figures highlight contrasting opportunities for hotel investors. India’s growth included acquisitions of operating hotels and distressed assets, while Spain’s investment remained concentrated in established hospitality destinations.
For hotel owners, developers and operators, the central question is how to identify assets with scope to improve performance while keeping acquisition and operating costs in line with sustainable returns.
Regional markets drive India’s investment surge
India recorded US$497m in hotel transactions across 11 deals between January and June 2026, up 197% from US$167m in the same period a year earlier, according to ETHospitalityWorld’s reporting on JLL research.
Tier-II and Tier-III markets — destinations beyond India’s principal metropolitan centres — accounted for 60% of transaction value, highlighting the growing importance of regional locations in the country’s hotel investment landscape.
Real estate developers accounted for 58% of investment volume, while operating hotels represented approximately 70% of transaction value. Deals conducted through India’s Insolvency and Bankruptcy Code contributed US$288m, equivalent to 58% of the total.
These figures describe different aspects of the transactions, including investor type, asset status and transaction route, and therefore overlap. Together, however, they indicate that acquisitions of existing properties are a significant component of India’s investment activity.
Investors are pursuing opportunities to acquire operating businesses and reposition distressed assets, alongside developing new hotels. For buyers of financially troubled properties, the purchase price is only one part of the investment case.
Refurbishment requirements, financing costs and the time needed to improve operations will all influence potential returns.
The transaction count also warrants caution.
With 11 deals underpinning the half-year total, a small number of large acquisitions can materially influence the headline growth rate. The increase signals a sharp rise in reported transaction value, but does not establish that investment is accelerating uniformly across the market.
For developers targeting regional destinations, the priority is to determine whether local business and leisure demand can sustain additional hotel capacity. That requires an assessment of year-round demand, competing supply, transport connectivity and the costs of staffing and operating a property.
Tier-II and Tier-III cities may offer opportunities to establish hotel brands in markets with developing commercial activity and less established branded accommodation. However, their investment potential depends on local conditions rather than city size alone.
Resorts drive Spain’s hotel investment record
Spain attracted €2.46bn in hotel investment during the first half of 2026, up 26.5% year on year, according to Colliers. The total represented the country’s strongest first half on record.
Resorts accounted for 60% of investment. The Balearic Islands led with €577m, followed by the Costa del Sol with €435m and Madrid with €397m.
Four- and five-star properties attracted 86% of investment, while domestic capital contributed 62% of the total. Individual-asset transactions represented 82% of investment volume, outweighing portfolio acquisitions.
The figures point to sustained investor interest in established destinations and higher-category hotels. Opportunities may include refurbishing existing properties, repositioning them within the market or improving operating performance under new ownership.
Strong investor appetite, however, makes acquisition pricing critical. Buyers must assess how much anticipated revenue growth and operational improvement is already reflected in the purchase price, as well as the additional capital required to deliver those gains.
Location also shapes the investment case. An island resort, a coastal hotel and an urban property serve different customer segments and demand patterns, requiring different operating strategies.
National investment growth provides useful context, but the performance of an individual asset ultimately determines whether an acquisition can meet its return targets.
For owners considering a sale, the concentration of investment in established destinations and higher-category properties also highlights the importance of asset positioning, condition and the ability to demonstrate future earnings potential.
Two markets, different investment dynamics
India and Spain recorded stronger hotel investment activity over the same six-month period, but the figures come from separate advisers. Differences in transaction definitions and market coverage limit direct comparisons between the reported totals.
Investment activity must also be distinguished from hotel development. A change of ownership does not necessarily add rooms to a market, while a brand signing or management agreement does not represent a completed property transaction.
In India, regional-market activity and acquisitions of existing hotels offer different routes into the sector. Investors can pursue new development where demand supports additional supply, or acquire and reposition properties where there is scope to improve their performance.
Both approaches require careful assessment of local demand, capital requirements and execution risks.
In Spain, investment is concentrated in established hospitality destinations, particularly resorts and four- and five-star properties. Buyers must determine whether an asset can sustain its trading performance and deliver further improvements at a price that supports the required return.
The distinction also matters for hotel operators.
In India’s regional markets, choosing the right brand, room mix and operating model requires a detailed understanding of local demand and competitive supply. In Spain, acquisitions and repositioning strategies may depend more heavily on asset quality, market positioning and opportunities to improve existing operations.
Neither market offers a uniform investment proposition. Regional Indian destinations can present opportunities for expansion, but demand and operating conditions vary considerably.
Spain benefits from established tourism markets, but competition for attractive assets can make pricing and the scope for further improvement decisive.
Returns remain the decisive measure
The first-half figures demonstrate that regional Indian markets and established Spanish destinations can attract capital simultaneously, rather than indicating a straightforward transfer of investment from mature to emerging markets.
India’s reported 197% increase puts regional destinations and existing-asset transactions in focus, while Spain’s €2.46bn investment total underlines the continued appeal of established resort markets and higher-category hotels.
For investors, the decisive considerations remain the price paid, the depth of local demand, the capital required to bring a property to the desired standard and its ability to generate sustainable operating returns.
Strong transaction growth can signal opportunity, but it does not guarantee attractive investment performance.
As capital targets markets with different growth profiles, successful investment will depend on matching each asset to its local demand, operating environment and realistic potential for long-term returns.
