Full-service hotel transactions are driving the hospitality market forward

By: Rudy Reudelhuber, Executive Managing Director

Full-service hotel transactions are driving the hospitality market forward 

The hospitality sector is seeing consistent growth across asset classes. In the first half of 2026, total single-asset hotel transaction volume increased 31% year-over-year.  Select-service transaction volume remained consistent, growing 7%. Full-service hotels significantly outpaced the select-service segment  with transaction volume increasing 48%. Full-service properties also grew from representing 58% of total transaction volume in the first quarter of 2025 to 67% in the second quarter of 2026. What is driving the acceleration in full-service hotel transactions? 

Full-service hotels have more dials to turn 

Full-service hotels offer significant opportunities for new ownership, with multiple operating components that can be optimized to increase revenue and cash flow. Amenities such as restaurants, meeting spaces, spas, golf courses, and retail outlets create additional revenue streams while enhancing the guest experience. Although these assets require more operational complexity, investors can capitalize on opportunities to reposition properties, improve performance, and create value. 

Debt is readily available 

Opportunity is only part of the equation; the availability of debt remains consistent as well. HWE Capital Markets remains active across both acquisitions and refinancings, with access to a broad range of capital sources, including CMBS, life companies, banks, and debt funds. With detailed business plans, new owners can secure financing more efficiently, inducing lenders to compete for transactions which supports increased deal volume. 

Buyers remain disciplined and cash is king 

This year, buyers have remained disciplined, prioritizing in-place cash flow to navigate changing market conditions. Most buyers are hesitant to underwrite deals based heavily on projected future cash flows, as rising labor and renovation costs can quickly erode returns and place additional strain on finances. As a result, investors are increasingly focused on in-place yields rather than relying solely on projected gains from repositioning or operational improvements. 

Equity and timing are important. Buyers are leveraging tools such as AI-powered underwriting to evaluate opportunities more efficiently and are focusing on assets brought to market by ready, willing and able sellers at current market pricing. Buyers are focused not only on their return on invested capital but also their return on invested time. 

Best-in-class brokerage is key 

When a highly experienced and respected brokerage team represents a seller, the investment community takes notice throughout the process. A brokerage’s reputation can strengthen the seller’s position by creating credibility, attracting qualified buyers, and leveraging established industry relationships. For both select-service and full-service individual assets and portfolios, HWE is available to provide owners with complimentary opinions of value, as well as borrowers with indications of potential loan proceeds and pricing.