ALIS 2025 highlights investment opportunities for Canadian hoteliers

Market stability is improving, with transaction activity expected to rise by 25 to 30 per cent compared to 2024, according to JLL. This increase is particularly noticeable in the full-service hotel segment, indicating positive opportunities for Canadian investors seeking expansion or diversification in hotel assets.

Despite higher-than-anticipated interest rates, the investment climate is becoming more favourable as the gap between buyer and seller expectations narrows. According to CBRE's "2025 U.S. Hotel Investor Intentions Survey," 94 per cent of hotel investors plan to maintain or increase their investments in hotels, encouraged by prospects of improved total returns.

Operationally, the hospitality sector continues to grapple with rising labour and insurance costs, pressuring profit margins. Colliers highlights that innovative management solutions are becoming essential for hoteliers aiming to control expenses while maintaining service standards.

A dominant theme at ALIS 2025 was the rising consumer preference for unique guest experiences. According to Brittain Resorts, consumers increasingly favour hotels that offer distinctive experiences—such as themes related to nostalgia or adventure—creating a competitive advantage for properties capable of providing such specialized offerings.

Technological advancements, particularly artificial intelligence (AI), are playing a critical role in enhancing hotel operations. Brittain Resorts emphasizes that adopting AI can significantly improve operational efficiency and strategic decision-making, offering a competitive edge for Canadian hotels embracing these innovations.

Policy changes, notably immigration, could substantially influence labour availability. Colliers advises hoteliers to monitor these policy developments closely, as they may significantly impact labour strategies and overall hotel operations.

Hotel performance metrics like revenue per available room (RevPAR) and average daily rate (ADR) are expected to see moderate growth. According to Hotel Management Network, ADR is projected to rise by approximately 1.6 per cent in 2025, this speaks to the necessity for Canadian hoteliers to implement competitive yet strategic pricing models.

Group travel and large-scale events are rebounding strongly. Brittain Resorts points out the resurgence of medium- to large-scale meetings and events, reversing prior trends favouring smaller gatherings. Canadian venues are well-positioned to capitalize on this increased demand for event spaces, enhancing midweek occupancy and revenue streams.

Strategic partnerships between hotel brands, technology providers, and owners are becoming increasingly important. Coast Hotels specifically addressed how currency fluctuations, particularly involving the Canadian dollar, influence their cross-border expansion strategies, suggesting opportunities for strategic partnerships that mitigate financial risk.

For Canadian hoteliers considering U.S. investments, several promising avenues exist. American Hotel Income Properties REIT (AHIP) continues to offer investment opportunities in branded select-service hotels in the U.S. market (AHIP). Additionally, higher interest rates and market adjustments present potential for direct acquisitions of undervalued U.S. hotel assets.

Furthermore, the EB-5 visa program offers Canadian investors an opportunity to participate in U.S. hotel developments while potentially securing a pathway for residency, although careful navigation of the regulatory landscape is essential, as reported by Wikipedia.

Overall, the outlook from ALIS 2025 points toward cautious optimism, highlighting opportunities for Canadian hoteliers who strategically leverage market insights, technology, unique guest experiences, and partnership opportunities.