US visitors fuel hotel expansion across Europe

Yahoo

5 days ago

Europe's hotel sector is experiencing a remarkable upswing, driven by a surge in American travellers.
Between January and May 2025, more than 7.7 million US tourists arrived in Europe—a 6% increase over the same period last year—despite the absence of major events like the Paris Olympics or blockbuster concert tours.
Industry analysts point to a strong US dollar, geopolitical instability in alternative destinations such as the Middle East, and competitive transatlantic airfares as key reasons for the boom.
Hotel chains are seizing the opportunity. Hilton is on track to open 65 new European properties this year alone, while Marriott has expanded its regional room supply by 11.5% over the past two years, prioritising popular destinations like Greece.
These US travellers are particularly valuable, often booking flexible, premium-rate rooms that command up to 25% higher nightly rates compared with domestic or regional tourists.
Yet as Americans flock to Europe, a rising tide of local discontent is casting a shadow over the hospitality sector's growth.
Protests have erupted in cities including Barcelona, Amsterdam, Venice, and Santorini, where residents blame mass tourism for housing shortages, spiralling rents, and quality-of-life disruptions.
The backlash came to a head recently in Venice, when protests targeted the lavish wedding of Amazon founder Jeff Bezos and Lauren Sánchez.
Residents waved banners reading 'No Space for Bezos' and staged demonstrations near historic sites, arguing the event symbolised how wealthy tourists are displacing local communities.
Activists described the city's decision to host the wedding as 'selling Venice's soul,' despite local officials praising the event for its economic boost and worldwide publicity.
Venice's anti-tourism movement highlights deeper frustrations. The city has lost nearly half of its historic centre's population since the 1980s, largely because of overreliance on short-term visitors.
Similar grievances are surfacing in Barcelona, where local authorities have announced plans to phase out more than 10,000 holiday lets by 2028, citing overtourism's damage to neighbourhoods.
Europe's hotel sector now finds itself in a delicate balancing act: capitalising on booming demand from US visitors while avoiding reputational risks linked to overtourism.
Industry experts caution that hotels must adapt by engaging with local communities, supporting sustainable tourism initiatives, and anticipating new regulations such as tourist taxes and rental restrictions.
Notably, many hotel chains are expanding beyond saturated destinations to emerging markets like Portugal's Algarve, Bosnia, and Herzegovina—regions that promise growth opportunities with fewer immediate overtourism pressures.
Brands including IHG and Marriott are also exploring smaller cities that welcome tourism as a key economic driver but require sensitive development to maintain local support.
Revenue potential: US tourists offer lucrative margins, but overdependence on them can expose operators to geopolitical or currency risks.
Community engagement: Hotels that proactively support local projects, reduce environmental impacts, and prioritise local hiring are better positioned to maintain social licence.
Regulatory headwinds: Overtourism-driven policies like rental bans, capacity caps, and visitor taxes could reshape supply and profitability.
Sustainable expansion: Targeting less saturated destinations and investing in responsible operations will help future-proof portfolios.
Europe's hotel industry stands at a crossroads.
While record-breaking US travel demand promises strong revenues, the sustainability of this growth depends on hotels' ability to respect and support the destinations they serve.
Successful operators will be those who balance commercial ambition with a commitment to preserving local communities' quality of life—ensuring tourism benefits both guests and hosts for years to come.
"US visitors fuel hotel expansion across Europe" was originally created and published by Hotel Management Network, a GlobalData owned brand.
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