European hotel investors eye stronger returns in 2026

European hotel investors are entering 2026 with renewed confidence and clear priorities: deploying more capital, but with greater selectivity. Amid rising expectations for returns, nearly 9 in 10 investors intend to maintain or boost spending in the sector, according to a new report from Cushman & Wakefield.

Europe's hotel market shows resilience

Despite lingering caution, the continent's hospitality sector is poised for growth, driven by a shift in investor strategies and rising demand for premium properties. The latest data from Cushman & Wakefield's Hotel Investment Sentiment Survey reveals that 86% of large-scale investors, including private equity groups and investment vehicles, plan to hold steady or increase spending in the coming year.

While expectations vary slightly across regions, overall sentiment leans upward, with Southern Europe leading the pack in investor enthusiasm. Italy, the Iberian Peninsula, and France top the list of favored destinations, followed closely by the UK and Ireland. In contrast, the DACH region (Germany, Austria, Switzerland) sees interest dip to 37%, down from 45% last year, but still viewed as a reliable foundation for long-term hospitality investments.

Rising Returns Needed as Lending Gets Riskier: As investors up their game, so too do expectations for returns. Demand has surged to 15.6%, up from 13.6% last year, driven by uncertainty in credit markets and a growing trend toward