- Developers still generally bullish on hotel branded condo market – For a growing number of mixed-use condominium development projects, partnering with a luxury brand is an effective way to appeal to residents seeking premium amenities, top-tier service, and an overall lifestyle reminiscent of a luxury resort hotel. We expect this trend to continue in key markets across the United States as developers look to pre-sell condos and tap into buyers’ deposits to help offset hotel construction and other costs while adding additional value to existing real estate.
- Experiential and wellness travel gains popularity – From surfing in Costa Rica to hiking in upstate New York, many travelers are seeking authentic, culturally rich experiences that support their personal wellbeing. Wellness travel has been gaining popularity in recent years and is expected to further grow in 2025, generally boosting destinations that offer things like spas, yoga, meditation, nature immersion, and nutrition-based food options.
- A renewed focus on stabilizing costs – Persistent inflation, high debt costs, and regulatory challenges have had a significant impact on new hotel developments and the maintenance of existing properties throughout the industry. We expect these headwinds to remain in place over the next year, leading to a renewed focus on cost management, repositioning of existing assets, and profitable markets.
- Convention hotel sector likely to maintain growth – The convention travel sector continued its recovery last year from its pandemic lows, indicating that demand for in-person events is somewhat immune to sustained challenges in the U.S. office sector driven by hybrid and remote work. Many cities with large convention centers are seeing substantial private sector development of new convention hotels and investment in upgrading and expanding existing hotel offerings to accommodate renewed demand for group business travel.
- A projected pickup in U.S. outbound hotel investment – Recent nine-figure hotel deals in Asia and Europe suggest that U.S. investors are looking to deploy more capital abroad. U.S. outbound foreign investment in hospitality properties is expected to increase in 2025 as investors strategically target markets with strong fundamentals, substantial forecasted growth potential, and value-add opportunities.
About the Authors:
Samantha Ahuja and Michael J. Sullivan are co-chairs of Greenberg Traurig’s Hospitality Practice.
Ahuja, a shareholder in the firm’s Washington, D.C., office, focuses her practice on hotel acquisitions, operations, development and finance, hotel management agreements, licensing agreements, and commercial real estate acquisitions and sales. She advises domestic and international clients on the acquisition and disposition of hotels and other commercial property, hotel management and operations, franchising, licensing and branding, restaurant management agreements, lease negotiations, and casino agreements.
Sullivan, a shareholder in Greenberg Traurig’s Orlando office, has wide-ranging experience in the acquisition, development, finance and disposition of hotels, resorts, branded residences and condo-hotels, as well as management, franchise and operating agreements for hotels and publicly financed hotel management agreements. Additionally, Sullivan advises on construction and permanent financings, the purchase of distressed mortgage debt instruments secured by hospitality-related real estate, tokenized real estate securities offerings and secondary market trading structures.