Asia Pacific Hotels & Hospitality Performance & Outlook 2026

Asia Pacific’s tourism recovery continued in the first half of 2026, supported by resilient regional and domestic travel demand. While disruptions to long-haul flight connectivity and higher travel costs created headwinds, most markets continued to record growth in international visitor arrivals.

Strong tourism demand is supporting higher Average Daily Rates across the region. Although hotel occupancy remains below pre-pandemic levels in many markets, overall hotel performance remains positive, with Revenue Per Available Room rising across most markets.

Elevated construction costs and the slow recovery in occupancy are constraining new hotel development. Future supply is expected to remain limited and concentrated in upscale and higher-end projects, encouraging more investors to consider the conversion of existing buildings.

Hotel investment activity also strengthened, with Asia Pacific transaction volume reaching US$8 billion in the first half of 2026. Japan, mainland China and Korea led activity, although elevated borrowing costs in some markets may affect investment momentum in the second half of the year.