New Zealand's hotel investment market is entering a new growth phase, supported by improving tourism fundamentals, renewed interest from international capital and a favourable supply and demand backdrop.
Peter Hamilton, Director of Capital Markets - Hotels at CBRE, said the recovery follows several years of disruption, with stronger international visitation, improving air connectivity and major infrastructure projects reshaping key tourism and business destinations.
“The continued rebound in international arrivals remains a key driver of tourism growth, which is New Zealand's second-largest export earner and a critical contributor to the overall economy.”
Airline capacity has improved steadily as long-haul networks are rebuilt and increased, while visitor numbers from China, historically one of New Zealand's highest-value inbound markets, increased by 43% in the six months to June 2026 on the back of strong demand and capacity improvements.
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A relatively weak New Zealand dollar is also supporting tourism demand, enhancing affordability for inbound visitors and moderating outbound travel by New Zealand residents.
Several transformational tourism-related projects are expected to further strengthen the demand outlook, Hamilton said.
“The recent opening of the New Zealand International Convention Centre in Auckland and One New Zealand Stadium in Christchurch, as well as the upcoming Auckland City Rail Link, have enhanced the country's capacity to attract major conferences, events and visitor activity.
"Other initiatives including the signed India-New Zealand Free Trade Agreement and ongoing discussions about direct air services could unlock a meaningful new source of tourism and business demand over the medium term.”
Queenstown continues to be the stand-out tourism centre, driven by strong leisure demand and constrained new supply which is supporting market-leading hotel revenue growth, he said.
“Queenstown's global appeal, combined with New Zealand's strength in luxury travel and scenic tourism, is expected to sustain tourism income growth and generate a positive halo effect for investor sentiment nationally.”
Elevated construction costs and financing challenges continue to deter new hotel development, limiting upcoming room supply. While the feasibility of new projects is challenging, the demand environment provides income security for existing assets and supports long-term pricing power across established markets.
Investor sentiment has improved significantly, demonstrated by several recent landmark transactions.
Sales including InterContinental Auckland, Hotel Indigo Auckland, QT Auckland, Rydges Wellington and Sofitel Queenstown have all attracted new offshore capital. This is a notable change after a relative absence of international buyers in the New Zealand hotel sector since 2019.
The return of international capital is a further signal of growing confidence in New Zealand's tourism outlook, said Hamilton.
“The re-emergence of offshore buyers reflects the relative value New Zealand offers compared with other Asia-Pacific markets and improving liquidity in the sector. The buyer pool is broadening, with demand coming from local and international high net worth investors, owner-operators, family offices, private equity groups and institutional capital.”
The overall New Zealand investment case remains compelling, with the country benefiting from an AA+ sovereign credit rating, a top-tier global safety profile, forecast population growth of 10% between 2025 and 2035 and a favourable tax environment.
The Active Investor Plus visa programme further strengthens the New Zealand investment case.
“The golden visa is encouraging offshore capital into the country and creating additional pathways for international investors seeking exposure to New Zealand real estate and tourism assets.”
With construction costs continuing to limit near-term supply and offshore capital once again seeking exposure to our tourism sector, the market is well positioned for sustained income growth and increased transactional activity over the medium term, Hamilton said.
“New Zealand hotels offer a compelling combination of recovering international demand, limited new supply and improving supporting infrastructure that should continue to support revenue growth and attract renewed capital depth.”
- Supplied by CBRE
