India’s hospitality investment market is gaining momentum. Hotel transaction volumes surged 197% to US 497 million in H1 2026 with full-year investments projected to reach US 1.1 billion, according to JLL’s Hotel Investment Trends in India – H1 2026 report.
The surge reflects growing investor confidence, expanding institutional participation and rising interest in emerging hospitality markets.
Real estate developers accounted for 58% of transaction volumes in H1 2026, marking a significant shift from 2025, when high-net-worth individuals, family offices and private hotel owners held a combined 54% share. Listed hotel companies contributed 31.1%, while HNIs, family offices and private hotel owners accounted for 8.2%.
Tier II and III cities captured 60% of transaction volumes, surpassing Tier I markets at 40%. Investments spanned luxury resorts in Kerala and Coorg, luxury hotels in Agra, Mussoorie and Noida, and upper-upscale properties in Udaipur and Jaipur. The trend signals a broader geographical shift as investors look beyond established metropolitan markets to destinations benefiting from rising leisure demand.
While established Tier I hubs including Mumbai, Bengaluru, Hyderabad, and Ahmedabad continued attracting development activity, Tier II markets such as Rishikesh, Patna, Navi Mumbai, and Jaipur emerged as primary growth drivers.
“The investor landscape is undergoing a fundamental shift,” says Gaurav Sharma, Managing Director, Hotels, India, and Senior Director, Hotels Capital Markets, Asia, JLL. He highlights the growing role of institutional capital, strategic platform investments and consolidation in shaping the sector’s next phase of growth.
Transactions driven by the Insolvency and Bankruptcy Code (IBC) generated approximately US$288 million, equivalent to 58% of H1 investment volumes. The activity underscores investor interest in distressed assets and opportunities to unlock value through acquisitions and repositioning.
Operational hotels accounted for around 70% of transaction volumes, while under-construction and non-operational properties contributed 23%, with land leases making up the balance. Luxury hotels led by segment, accounting for 51% of transaction volumes, followed by upscale properties at 35%, upper-upscale at 12% and economy hotels at 2%.
Branded hotel signings reached 29,360 keys by June 2026, with 74% concentrated in Tier II and III cities. Management contracts accounted for 77% of signings, followed by franchises at 22% and lease or revenue-share agreements at 1%.
Greenfield developments contributed 13,689 keys, while larger hotels also gained traction. Fifteen hotels with more than 250 keys were signed during H1, compared with five in the same period last year. Mumbai, Bengaluru, Hyderabad and Ahmedabad continued to attract development, while Rishikesh, Patna, Navi Mumbai and Jaipur emerged as important growth centres.
Branded hotel openings totalled 5,048 keys in H1 2026, with 71% in Tier II and III cities. Upscale hotels accounted for the largest share at 45%, followed by midscale at 28%, economy at 14%, upper-upscale at 8% and luxury at 5%.
JLL projects full-year hotel transaction volumes to reach US$1.1 billion, supported by growing institutional participation, consolidation and demand for quality branded assets. Platform-level investments are also expected to gain traction as investors seek scale, operational efficiencies and diversified portfolios.
Insolvency and Bankruptcy Code (IBC)-led transactions demonstrated strong investor appetite for distressed-asset opportunities, generating approximately $288 million, representing 58 percent of H1 2026’s total transaction volume.
Luxury and operational hotels command premium
Operational hotels across all tiers accounted for approximately 70 percent of total transaction volume, with under-construction or non-operational hotels representing 23 percent and land leases comprising the balance. The luxury segment commanded the highest share at 51 percent of total volume, followed by upscale properties at 35 percent, upper-upscale at 12 percent, and economy segment at 2 percent.
The second half has already demonstrated strong momentum, with acquisitions across Ahmedabad, Bengaluru, and Pune, plus strategic land transactions totaling 420 acres in the Mumbai Metropolitan Region and 15 acres in Goa, collectively valued at approximately $313 million.
Gaurav Sharma, managing director Hotels, India, senior director Hotels Capital Markets, Asia, JLL, adding, “The convergence of institutional capital, evidenced by nearly USD 445 million in strategic platform investments, robust consolidation activity through marquee acquisitions, and sustained signing momentum of more than 29,000 keys in H1 alone, positions Indian hospitality for a multi-year growth trajectory. With limited availability of institutional-grade assets, strong operational fundamentals, and IBC-led opportunities unlocking distressed asset value, we anticipate competitive bidding to intensify. The sector’s appeal extends beyond current performance metrics, it is about capturing India’s evolving consumption story, where emerging destinations and experiential leisure are redefining investment theses for the next decade.”
With hotel performance strengthening, institutional-grade assets remaining limited and emerging destinations attracting capital, India’s hospitality sector is positioning itself for sustained investment growth through 2026 and beyond.
Vincent Fernandes
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