Australia hotel property deals double to AUD676m in Q1

Thanks to high-profile deals that closed during the quarter.

According to a Colliers report, Australia’s hotel sector entered 2025 with renewed momentum, supported by strong fundamentals, easing finance costs and balanced supply-demand dynamics.

With only 3,200 new rooms expected in 2025, the market is adjusting to a “new norm” and is increasingly viewed as a safe haven amid global volatility.

Here’s more from Colliers:

Hotel transaction volume doubled year-on-year to AU$676 million in Q1, led by high-profile deals such as Melbourne Place and Hilton Adelaide. Offshore capital accounted for 41% of activity, with investors targeting value-add plays amid high development costs.

RevPAR (AUD) growth ranged from 6.7% in Perth to 1.7% in Sydney, driven by rising occupancies. Luxury segments remained resilient, while secondary and leisure markets showed mixed results due to weather impacts and holiday periods.

With rate cuts expected and tourism demand strengthening, investor sentiment remains cautiously optimistic. Asset conversions, third-party F&B partnerships and sustainability initiatives are emerging as considerations for long-term value creation.