INVESTMENT ACTIVITY
The hotel investment market in Spain showed remarkable momentum and consolidation during the first half of 2025. With a total investment volume of €2.1 billion, the sector not only recovered to pre-pandemic levels but also recorded the third-highest first semester in history. Driven by robust demand and high-performing assets, the leisure sector regained its leadership, boosted by the record-breaking €430 million acquisition of the Mare Nostrum Resort in Tenerife. Domestic investors led the transactions, accounting for 66% of the volume. With a strong pipeline for H2 2025, the sector is on track. to surpass 3 billion mark, reinforcing Spain’s appeal to both domestic and international capital.
PRIME YIELDS
Hotel yields in Spain have remained stable or slightly compressed in prime destinations such as Madrid, Barcelona, the Balearic Islands, and the Canary Islands, driven by strong investor demand and constrained supply.
SUPPLY & DEMAND
Despite record-breaking demand, hotel supply has not kept pace, creating a supply-demand imbalance, with fewer hotel establishments (16,778) than 2015 levels. This imbalance has contributed to rising prices and improved performance indicators (e.g., RevPAR). The limited growth in supply is due to constraints such as land availability, regulatory pressures, and a focus on quality over quantity. As a result, the total number of hotel rooms increased by only 0.7% in H1 2025.
PERFORMANCE
Spain delivered a strong performance in H1 2025, with RevPAR increasing by 6.9% year-over-year to reach €115.7. This growth was primarily driven by a 6.5% rise in ADR, while occupancy remained stable (+0.2 percentage points). ADR in Madrid and Barcelona rose by 6.6% and 3.1% compared to H1 2024. Marbella and Fuerteventura were leading the growth rate in ADR (+15% and 12%) while destinations enjoying the highest increases in occupancy were Marbella (+4.3%), Zaragoza (+3.9%) and the Balearic Islands (+3.2%).
