Barcelona rivals London as Europe’s top hotel investment spot – CBRE

CBRE's latest European Hotel Investor Intentions Survey reveals that Barcelona has become one of Europe's premier hotel investment destinations in 2026, sharing the top spot with perennial leader London.

Hotels - CBRE

This shift reflects investors' continued preference for high-performing markets with limited supply. Barcelona jumped from fifth place in 2025. Madrid ranks third, with Paris and Milan jointly holding fourth, indicating a strong appetite for a mix of major gateway cities and leisure-focused locations.

Barcelona's increasing allure stems from robust hotel demand across both leisure and business travel, bolstered by its status as a leading MICE (Meetings, Incentives, Conferences and Exhibitions) destination in Europe. Strict regulations on tourist apartments and new short-term rental licenses are channelling accommodation demand back to hotels, while restrictions on new hotel construction continue to constrain future supply.

Despite ongoing geopolitical and economic uncertainties, confidence in the European hotel market remains high, with over 90% of investors planning to either maintain or increase their capital allocation in the sector.

The sector's strong fundamentals are a key draw, with 31% of respondents intending to significantly increase their allocations, up from 26% in 2025, and very few planning to reduce their exposure. Optimistic total return prospects and attractive pricing valuations are cited as the primary drivers of this investment activity.

At a country level, Spain is still considered the top investment destination for strong hotel fundamentals in 2026, followed by Italy and the UK. These top three rankings are unchanged from last year, signifying consistent investor confidence. France and Portugal share fourth place. The survey results suggest that Southern Europe will capture a significant portion of investor interest, with the Iberian Peninsula and Italy collectively accounting for over 40% of planned capital deployment.

While value-add strategies remain dominant, investors are starting to diversify their approach. Interest in opportunistic strategies has risen to 25% from 15% in 2025, indicating a more selective move towards higher-risk opportunities.

Luxury hotels continue to be the most attractive segment for investors, favoured by 53% of respondents. There's also growing interest in more operationally resilient formats like extended-stay and all-inclusive models. Concurrently, investor preference for globally recognized brands has increased to 53%, up from 43% in 2025.

Kenneth Hatton, European head of Hotels at CBRE, commented: “Rising capital expenditure and operating costs have emerged as the most significant concerns for investors, highlighting an increasing focus on operational performance and value delivered from capex projects. We are seeing investors take a more evolved view of the markets they are interested in, making them more selective and focusing on assets and strategies that clearly deliver on their own particular investment thesis.”

Ronald Chan, European Hotels Research lead at CBRE, added: “Sustained travel demand and the sector’s pricing power continue to underpin investor appetite. We are also seeing a shift in focus towards assets and formats where investors can unlock value while benefiting from more stable income streams, particularly in segments such as luxury and extended-stay hotels.”

CBRE's 2026 European Hotel Investor Intentions Survey gathered responses from over 70 hotel investors across Europe between February and March 2026.