For a comprehensive review of the Europe market, click below:
HVS In-Depth Europe Hotel Valuation Index:   2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 | 2011 | 2010 | 2009 | 2008 | 2007 | 2006 | 2005 | 2004 | 2003 | 2002 | 2001

With a population of 9.5 million as of the last census conducted in 2021, London is the largest city of the UK and one of the largest urban areas in Europe. The city, ranked second in the latest Global Financial Centres Index, is considered as a one of the world’s leading business and financial centres. London is home to several world-renowned institutions, such as the British Museum, the Tate Modern, and the West End Theatre scene. It also hosts some of the world’s top universities, including Imperial College London, University College London (UCL), and London School of Economics (LSE). With its rich cultural heritage and internation reputation, London benefits from a steady mix of both leisure and business travel.

Following the 2016 EU referendum, the sharp depreciation of the pound against the euro spurred an increase in leisure travel from key source markets such as the USA and mainland Europe. However, this was partly offset by a slowdown in business activity, driven by economic uncertainty. Until the withdrawal agreement was finalised in December 2020, investor sentiment and labour mobility were affected. Post-Brexit, labour shortages have become more pronounced, particularly in hospitality, tech, and healthcare, due to the decline in EU workers and the introduction of more stringent visa systems. In addition, several European financial institutions relocated operations to cities such as Paris and Frankfurt to maintain easier access to EU markets. Nevertheless, London has retained its global financial influence, supported by robust infrastructure, access to international capital, and a highly skilled talent pool.

In the years leading up to the COVID-19 pandemic, London’s hotel occupancy consistently hovered in the low 80s, while average rates remained relatively stable, despite some fluctuations. Hotel supply expanded at a healthy compound annual growth rate of 2% between 2016 and 2019, without significantly impacting overall market performance. Following the sharp downturn in 2020, demand began to recover from mid-2021, gaining strength into 2022. That year, average daily rates (ADR) surpassed 2019 levels in real terms, although occupancy lagged behind by approximately 12 to 14 percentage points. In 2023, the market saw a notable rebound in occupancy, nearly reaching pre-pandemic levels. Performance in 2024 maintained positive momentum, though growth showed signs of stabilising. The RevPAR achieved in 2024 reflects a 6% real increase over 2019 levels in euro terms, while in pounds, it nearly matches 2019 figures. The difference largely reflects the impact of inflation and currency fluctuations.

While the UK hotel development pipeline—alongside Germany’s—is among the most active in Europe, London’s hotel supply has grown at a moderate pace, with a CAGR of 1.5% from 2019 to 2024. A large pipeline has been announced in London potentially increasing the existing supply by over 10% in the next three to four years. A little over a third of this pipeline is said to be under construction, half are limited service and over half are non-branded. Some of the most awaited new supply is in the luxury segment and include the 146-room Rosewood Chancery London (September 2025), the 109-room Six Senses (Q4 2025), the 102-room Cambridge House Auberge Resorts Collection (February 2026) and the 100-room Waldorf Astoria London Admiralty Arch (May 2026). But let’s also mention the very large 529-room Moxy London Piccadilly Circus opening towards the end of 2025.

Transaction activity in London rebounded in 2024, highlighted by several high-profile deals. These included the 10-property Edwardian portfolio, acquired by Starwood Capital for approximately €920 million (around €450,000 per key) in January 2024, the 168-room ME London, sold for a reported €275 million (equating to €1.6 million per key), the 109-room Six Senses London, transacting for roughly €180 million (€1.7 million per key), ahead of its anticipated end of 2025 opening, the 266-room The Standard, sold by Crosstree for around €210 million (€790,000 per key).

Supported by a decline in the cost of debt and a slight improvement in operational profitability, hotel values in London rose by 0.8% in euro terms in 2024, according to our 2025 European Hotel Valuation Index.

ADR, Demand, Occupancy, RevPAR, and Supply Projections:

ADR Change
Market Demand Change
Hotel Occupancy Increase/Decrease
RevPAR Change
Market Supply Growth

Change In Value For Market: (€Euro)

London RevPAR Change (€Euro)

London RevPAR (€Euro)

For more information, please contact:

	Sophie Perret, MRICS, MBA Managing Director [email protected] +44 0 2078787722 (w) +44 0 7725781037 (m)
	Margherita Rivetti [email protected] +44 0 278787754 (w) +44 0 7955271797 (m)
	Tabitha Watkins Analyst [email protected] +44 0 2078787724 (w) +44 0 7562956921 (m)