Deal volume in the UK hotel market was substantially up in the first half of 2026, reaching GBP2.1 billion in investments transacted.
The figure, calculated by agent Savills, was almost GBP500 million ahead of the volume a year prior. Single asset transactions in London were the key driver behind the increase. International investors continue to value the market for its scale, liquidity and the fact that lenders will back acquisitions in a dynamic city where hotels continue to perform strongly.
Single Asset Sales Drove Volume
Savills points to notable single asset transactions such as the Novotel London Tower Bridge, and the Radisson Blu Leicester Square, which both traded for prices in excess of GBP100 million. “UK hotel investment volumes in the first half of 2026 demonstrate the continued attractiveness of the sector, with London once again leading activity,” commented David Kellett, Head of Hotel Capital Markets EMEA at Savills. “Beyond London, investors are targeting resilient regional markets where trading fundamentals remain strong and yield dynamics are attractive.”
In the regions, notable deals included acquisitions by Millemont Capital Partners. The investor bought the Crowne Plaza hotels in Marlow and Reading, and also picked up the Courtyard by Marriott Oxford City Centre. In Edinburgh, the Hub by Premier Inn hotel was bought for GBP23.4 million, with Oval Real Estate selling to the Lothian Pension Fund.
And the optimism about the London hotel market underpins new development and planned openings in the UK capital. A strong pipeline of new additions stretches forward, with several key brand openings in the second half of 2026. These include the launch of Delano London, and the first Colbert Collection hotel in the region, with Minor International’s new brand opening in Piccadilly.
“The strength of activity in the first half provides an important foundation for the remainder of the year, particularly as geopolitical and political risks may impact investor decision making in the third quarter,” added Kellett. “Despite this, the UK hotel sector continues to benefit from strong operational fundamentals and a deep pool of capital.”
London’s Luxury Pipeline
Also nearing completion is Cambridge House, which will open as part of the Auberge Resorts Collection. Close by, the St Regis London will launch, the reimagined and extended former Westbury hotel. Hilton will be making much of the final finishing and opening of its Waldorf Astoria London, set in the landmark Admiralty Arch building, with views of Buckingham Palace and Trafalgar Square, surely some of the best guest rooms in the capital.
In the UK’s second city, Birmingham, the hotel market is tighter, with little new inventory coming into the market in the next year. Village Hotels will complete an extension, adding rooms at its Village Hotel Birmingham Solihull, while 2027 will see the Radisson Red brand arrive in the city. The 146 room new build will sit alongside the city’s Edgbaston cricket stadium.
