- U.S. hotel investment rose 17.5 percent in 2025 to $24 billion, JLL reported.
- Private equity and debt markets support continued investment in 2026.
- Opportunities emerge in 2026 World Cup host cities, JLL analysis shows.
U.S. HOTEL INVESTMENT increased in 2025, with transaction volume rising 17.5 percent year over year to $24 billion, according to JLL Hotels & Hospitality Group. The sector is positioned for continued investment heading into 2026, driven by private equity and improving debt markets.
JLL’s “2025 U.S. Hotel Investment Trends Report” found higher transaction activity in select markets, led by New York with $3.7 billion across 29 trades, followed by Phoenix with $1.5 billion across 22 trades and Washington, D.C. with $1.2 billion across 22 trades. Several large transactions drove volume in these markets, reflecting investor focus on urban and growth markets tied to long-term returns.
The data showed a shift in hotel investment, with high-net-worth individuals and foreign capital becoming more active while private equity remained involved. The diversification of buyers reflects the market’s focus on hotels’ value, given the discount to replacement costs and yield compared with other property sectors.
This momentum is expected to continue into 2026, supported by debt markets that have lowered borrowing costs.
“Since September 2024, when the Fed started lowering interest rates, the overall cost of debt has decreased by almost 300 basis points, enabling investors to achieve positive leverage when acquiring assets and driving increased investment activity,” said Kevin Davis, JLL’s CEO for the Americas. “This dynamic fueled transaction activity in the second half of 2025 and will continue to drive transactions in 2026.”
2025 hotel performance showed a K-shaped recovery, with revenue per available room rising 3 percent for luxury properties and falling 2.8 percent and 4.4 percent for midscale and economy segments, respectively, the report said. This split reflects changing consumer preferences, with high-income travelers supporting the premium segment.
2026 Outlook
Looking ahead to 2026, JLL's analysis highlights opportunities in World Cup host cities. Historical data show Super Bowl games add an average of 2.8 percentage points to annual market RevPAR and World Cup host cities could see a greater impact due to the tournament’s longer duration.
"The World Cup represents a transformational opportunity for U.S. hotel markets," said Dan Peek, JLL’s president for the Americas. "Combined with America's 250th anniversary celebrations, select cities are positioned for exceptional performance in 2026. Our forward-looking analysis indicates this could be a watershed moment for the hospitality sector."
The supply outlook supports the investment thesis, with new hotel supply growth expected to stay below the long-term average of 1.7 percent annually. Combined with the 43 percent urban share of 2025 transaction volume, this shows investor confidence in existing assets amid limited new competition.
A recent report by the American Hotel & Lodging Association found that hotel guest spending is expected to reach nearly $805 billion in 2026, a 1.7 percent increase over 2025. The association projects opportunities from major global events, such as the FIFA World Cup and America250, as the industry continues investing in hiring and operations.
