Seoul Hotel Investment: Same Rooms, New Value

Seoul’s hotel market is underpinned by demand that has surpassed pre-pandemic levels. Inbound visitors reached a record high in 2025 and continue to grow rapidly in 2026. Purpose-driven visits, such as for “Hallyu” (the Korean Wave) and medical tourism, have increased, and demand has held firm despite shifts in exchange rates and travel costs. Domestic hotel demand has also held up despite the recovery of outbound travel.

At the same time, room supply has barely grown. With hotel closures having continued after the pandemic, Seoul’s hotel room stock remains at 2019 levels. Little new supply is planned, and recent regulatory easing will take years to translate into new rooms. With supply constrained, rising demand has provided a strong tailwind for room rates, lifting Seoul hotel performance to its highest level since 2015.

With performance having recovered, hotels are once again valued as assets based on operating performance, and transaction prices have moved up a level. However, with limited room for further occupancy gains and borrowing costs likely to stay high for some time, opportunities to generate returns from simply acquiring and holding assets are limited. Additional returns will come from improving operating performance, with the choice of brand and contract structure at the center of this asset enhancement.

This CBRE Korea report examines Seoul hotel demand and supply, the transaction market and capitalization rates (cap rates), and brands and contract structures to identify where investment opportunities lie. It concludes with investment strategies by market phase and key indicators to watch.