CBRE recently highlighted that lifestyle hotels are rapidly becoming a major part of the hospitality scene in Asia Pacific. This shift is largely driven by changing preferences among travelers, especially Gen Z, who are making their mark on the industry.
The report, “Gen Z Checks In: The Rise of the Lifestyle Hotel,” dives into how younger guests are seeking more than just a place to stay. They want hotels that offer unique designs, cultural experiences, and tech-friendly services. In fact, Gen Z is now the biggest demographic group in Asia Pacific and is expected to influence travel trends even more as their buying power increases.
CBRE points out that branded lifestyle hotels have a long way to go in the region. Currently, only about 1% of hotels fall into this category, but this could rise to nearly 8% as new projects get underway. If we look at hotel supply growth from 2015 to 2025, overall hotel availability is growing at around 5% annually. In contrast, lifestyle hotel supply is booming at over 19% each year.
Ananth Ramchandran from CBRE believes that lifestyle hotels are well-positioned for further growth. Younger customers want experiences that reflect their values and interests. Cities like Singapore and Hong Kong already have a higher concentration of these hotels, where owners are more willing to try out newer brands and ideas.
However, the road isn’t completely smooth. Rising construction costs can make it tough for new hotels to break ground. To adapt, many investors are exploring ways to convert existing properties into lifestyle hotels, as it can be a more cost-effective strategy. This includes repurposing older hotels or using soft branding strategies to attract new kinds of guests. Smaller, independent hotels often present the best opportunities for these transformations.
The ongoing changes in hospitality demand across Asia Pacific are shaped not just by demographics but also by evolving travel behaviors and the desire for flexible, experience-oriented places to stay. As these trends continue to unfold, the hotel industry will need to adapt to meet the expectations of travelers.
For further insights, you can explore the full report on CBRE’s website here.
