Savills Australian Hotel Transaction Review 2025

INCREASED DEMAND FOR CBD ASSETS There was a revived preference for CBD and metropolitan markets in 2025. CBD transactions accounted for 58.4% of total sales volume in 2025, up from 36.5% in 2024 mainly driven by the resurgence in international investment. Whilst regional transaction volume moderated nationally, higher yields on offer in regional and suburban Queensland continued to attract investor interests. IMPROVING INVESTOR SENTIMENT Easing interest rates environment throughout 2025, strong hotel demand and a resurgence in cross-border investment into Australia supported transaction activity. In 2025, offshore markets contributed 46.3% of total hotel transaction value, driven largely by capital originating from Southeast Asian countries, particularly Thailand and Singapore. This trend is anticipated to continue into 2026. ROBUST HOTEL MARKET GROWTH Most major Australian capital cities recorded strong RevPAR growth in 2025, reflecting continued recovery in hotel performance despite some market variability. Occupancy remained the primary driver of growth, with several cities, such as Perth and Brisbane, surpassing pre-pandemic levels. Improving tourism fundamentals and strengthening demand conditions provide a positive outlook, with further upside potential. I SAVILLS AUSTRALIAN HOTEL TRANSACTION REVIEW 5