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Investment activity in India’s hotel sector continued to remain strong during the first quarter of 2026, supported by growing investor confidence and rising demand for hospitality assets. According to a recent report by JLL, hotel investments rose 58 per cent year-on-year to nearly USD 185 million during the January-March period. The report highlighted increasing participation from institutional investors, private equity firms, hotel companies and high net-worth individuals. Large transactions, expansion plans by organised hotel operators and new development opportunities around airports and commercial hubs are also contributing to sustained investment momentum across both metro and emerging cities.
Investment activity in India’s hotel sector recorded strong growth during the January-March quarter of 2026, reflecting sustained investor confidence in the hospitality market and long-term growth prospects of the industry. Advertisement
According to a recent report released by JLL, investments in the sector increased 58 per cent year-on-year to nearly USD 185 million during the first quarter of this year, compared to USD 117 million recorded in the corresponding period last year.
The consultancy, in its report titled Hotel Investment Trends in India: 2025, stated that the momentum seen through 2025 continued into the first quarter of 2026, supported by rising transaction activity and strong interest from institutional investors.
JLL noted that the January-March quarter witnessed exceptional transaction volumes, driven by continued investment momentum from the previous year. The report added that transactions during the quarter included acquisitions of operational hotels, land monetisation deals and consolidation through the acquisition of operating hotel platforms.
One of the key transactions during the quarter involved global investment firm Warburg Pincus acquiring a 41 per cent stake in Fleur Hotels, a subsidiary of Lemon Tree Hotels. The investor also committed around USD 107 million towards expanding the company’s portfolio of owned hotel assets.
The report observed that institutional capital and private equity firms are increasingly exploring opportunities in hotel portfolio acquisitions, as the hospitality sector continues to report strong operational performance and improving occupancy levels across major markets.
JLL further stated that the investment momentum is expected to continue over the coming quarters, supported by healthy liquidity with listed hotel companies and the possibility of additional hotel operators entering capital markets.
The consultant also pointed to rising opportunities emerging from land monetisation around key infrastructure and business zones. These include government-led land auctions and development activity in locations such as Yashobhoomi at India International Convention and Expo Centre (IICC), Neopolis in Hyderabad, Fintech City in Chennai and the upcoming Jewar Airport region.
The report highlighted that investment activity in India’s hotel industry had already strengthened considerably during the 2025 calendar year. Total investments rose 67 per cent to nearly USD 567 million across 28 transactions, compared to around USD 340 million in 2024.
The investment activity during 2025 was largely driven by institutional investors and private equity firms. Other active participants included high net-worth individuals, family offices, private hotel owners, listed hotel companies, real estate developers and owner-operators.
Metro cities continued to attract the highest share of investments, with tier 1 markets accounting for nearly 60 per cent of total transaction volumes. At the same time, tier 2 and tier 3 cities together contributed the remaining 40 per cent, indicating growing investor interest in emerging hospitality markets beyond major metros.
India’s hospitality sector also saw strong expansion in branded hotel supply during the previous year. Around 103 branded hotels with nearly 8,990 keys became operational during 2025.
In addition, branded hotel signings reached 51,647 keys across 424 hotels during the year, marking a 23 per cent increase over the previous year. Industry experts believe this reflects continued confidence among hotel operators and developers regarding travel demand, business tourism and long-term growth in India’s hospitality sector.
Source PTI
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