Indian hospitality sector looks to attract $1 billion in investments by 2028

The Indian hospitality sector is expected to attract $1 billion in investments by 2028. As per a recent finding by JLL, the development pipeline remained vigorous, with 31 new branded hotels (3,253 keys) opening during Q1 2025 in the country.

More impressively, the quarter saw 79 new hotel signings representing 9,478 keys, indicating continued investor confidence in the sector. There has been a substantial increase from the $340 million in hotel transactions recorded in 2024. 

As per the JLL findings, India’s hospitality industry demonstrated remarkable momentum in Q1 2025, with RevPAR (Revenue Per Available Room) surging 16.3 per cent compared to the same period last year. The sector’s strong performance continued sequentially, with an 8 per cent RevPAR increase from Q4 2024 across pan-India markets.

Investor confidence in the sector remains high, evidenced by 79 new hotel signings totalling 9,478 keys during this three-month period, signalling sustained expansion in India’s accommodation landscape.

Interestingly, during the period, Bengaluru emerged as the standout performer with an impressive 38.3 per cent year-on-year RevPAR growth, primarily driven by the Aero India 2025 event, which boosted both occupancy rates and average daily rates.

Delhi and Mumbai followed with strong RevPAR growth of 26.2 and 21.3 per cent, respectively, supported by robust occupancy levels.

Besides this, Chennai’s hospitality market showed notable performance with 18.7 per cent RevPAR growth, attributed to increased corporate travel, the Annual Leather Fair, and the USICON event held at the Chennai Trade Centre.

Hyderabad also posted solid results with 15.1 per cent RevPAR growth despite a slight occupancy decline, demonstrating strength in rate growth.

As per JLL, Q1 2025 already witnessed notable transaction activity, including Chalet Hotels Limited’s acquisition of The Westin Resort and Spa, Rishikesh (141 keys), for approximately ₹530 crore.

Strategic partnerships also shaped the quarter, highlighted by Hilton’s agreement with NILE Hospitality to introduce 75 Hampton brand hotels across India, with the first properties scheduled to open in Gujarat, Rajasthan, Punjab, and Bihar by 2026.

According to Jaideep Dang, the Managing Director, Hotels and Hospitality Group, India, JLL, the country’s hospitality sector continues to demonstrate exceptional resilience and growth potential, with Q1 2025 showing remarkable RevPAR growth across major markets, particularly Bengaluru’s impressive 38.3 per cent increase.

“The robust pipeline of 79 new hotel signings representing 9,478 keys this quarter reflects strong investor confidence in India’s hospitality fundamentals. With JLL projecting USD 1 billion in investments by 2028, we are witnessing a transformation in the market that balances immediate performance gains with strategic long-term positioning across all tiers and segments,” remarked Dang. 

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