From five-star resorts to branded residences, luxury houses and hotel groups are competing for a wealthy clientele that is gradually shifting its spending from material goods to experiences. Luxury hospitality is emerging as an attractive growth driver.
The balance of power in the luxury industry is changing. While fashion and leather goods groups are struggling to revive demand, international hotel operators are benefiting from a growing enthusiasm for high-end travel. This contrast is reflected in the financial markets. Between the end of 2025 and 10 November 2026, the shares of Marriott, Hilton, Hyatt, Accor and InterContinental Hotels rose by an average of 25%, while those of LVMH, Hermès and Kering fell by an average of 37%, according to Reuters.
This divergence goes beyond a simple cyclical phenomenon or a temporary change in investor sentiment. It reflects a structural shift in the way wealthy consumers allocate their spending. Rather than buying a new designer handbag or a luxury coat, they are willing to invest in exclusive stays, personalised services and memorable experiences.
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From Luxury Products to Exclusive Experiences
Several studies confirm this shift. A survey by McKinsey and Business of Fashion, conducted in June, reveals that 38% of occasional American luxury consumers would be willing to spend an additional 5,000 dollars on travel, ahead of even jewellery and handbags.
The hotel industry is particularly well positioned to capture this demand. According to Morgan Stanley estimates, luxury hotels generate around 200 billion dollars in annual revenue. Including fine dining, cruises and other high-end experiences, the wider market reaches some 415 billion dollars, slightly exceeding the 408 billion spent on personal luxury goods.
This momentum is also reflected in operating performance. Cushman & Wakefield reports that revenue per available room (RevPAR) for European hotels rose by 3% year-on-year in the first half of 2026. Luxury and upscale establishments, for their part, accounted for 46% of hotel investment volumes. In the United States and Europe, the RevPAR of luxury hotels has increased by 8% this year, again according to Morgan Stanley data.
Luxury Houses Want Their Place in Hospitality
For luxury brands, hospitality is an opportunity to diversify their revenue, strengthen customer loyalty and extend their universe beyond physical products. This strategy is not new. LVMH has developed its Cheval Blanc hotel collection and acquired Belmond in 2019 for 3.2 billion dollars. Bulgari has built an international presence in hospitality through its partnership with Marriott.
Hospitality nevertheless remains a relatively marginal activity in the accounts of the major fashion groups. At LVMH, activities outside its main divisions represent less than 1% of the group’s revenue, suggesting considerable development potential.
The right business model has yet to be found. Building and operating hotels requires significant capital, specialised expertise and a long-term investment horizon. Granting a brand licence to an established hotel operator is a less capital-intensive solution, but it carries a major risk: excessive expansion could dilute the exclusivity that is precisely what gives luxury brands their value.
Hotel groups, for their part, are accelerating their move upmarket. Hilton’s pipeline of development projects in the luxury segment reportedly represents the equivalent of 91% of its current room capacity in this category. Marriott is also continuing to expand its upscale and lifestyle portfolio.
This opportunity rests on favourable long-term fundamentals. In its 2026 global hotel investment outlook, JLL, one of the world’s leading corporate real estate consultancy and real estate investment management groups, highlights the growing gap between wealth creation and the relatively limited supply of rooms in ultra-luxury establishments. High construction costs and the scarcity of locations are holding back new projects, which could support the pricing power of operators that are already established.
Winning over wealthy consumers no longer happens only in boutiques, but also in hotel lobbies, private resorts and exclusive destinations.
Key Points:
- Luxury spending is shifting from products to experiences. Wealthy consumers are increasingly favouring exclusive travel, high-end hospitality and personalised services over traditional purchases such as handbags and clothing.
- Hospitality is outperforming fashion houses. Strong travel demand, rising room rates and the scarcity of luxury hotel supply are supporting operators’ growth.
- Hospitality represents a new growth driver for luxury brands.
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