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European hotel values saw a marginal increase of 0.2% in 2025, marking the smallest rise since the pandemic, according to the latest Hotel Valuation Index from global consultancy HVS.
The report found that while occupancy levels improved across the region, ongoing conflict and global instability limited overall value appreciation.
Copenhagen recorded the highest growth at 5.9%, driven by strong demand and limited new supply. Athens followed with a 5.5% increase as it attracted significant institutional investment.
In contrast, Istanbul saw values fall 7.6% due to high inflation and currency devaluation. Amsterdam recorded a 5.9% drop following tax increases on hotel accommodation.
Values in London and Manchester both declined 3.4%. Researchers attributed this to new supply and rising overheads, including higher National Insurance and minimum wage costs.
Paris remains the most expensive hotel market in Europe, followed by London, Zurich, Rome, and Geneva. The report noted that 19th Century cities continue to lead in premium pricing.
Margherita Rivetti, report co-author and associate at HVS, said: “While overall the HVI showed little movement in values across Europe as a whole, leisure demand continues to boost hotel performance.
“In Eastern Europe a combination of leisure and corporate demand and more stable inflation have driven hotel values up while in Western Europe there are more mixed results.”
Maxime Gauthier, report-co-author and associate at HVS London, said: “With new travel trends emerging in today’s hyper-connected digital environment, opportunities for hotels to use AI arise in the pursuit of increasing customer reach.
“The distinction between hotel and residential is increasingly becoming more blurred. While branded residential remains an important topic, as brands are now venturing into the furnished apartment space.”
Sophie Perret, managing director of HVS London, added: “Europe’s appeal to tourists will remain strong, which coupled with its modest project pipeline bodes well for hotel performance. However, the conflict in the Middle East and subsequent oil disruption could have a severe impact the longer it lasts, particularly on interest rates.”
