Another interesting and exciting year is done, and it has gone by in a flash. It certainly doesn’t feel like a year since the last motel market wrap-up. So how did the motel and accommodation industry perform throughout 2025?
If I had to sum up the year in one word, I would go with constant. There was a constant stream of enquiries and interested buyers wanting to acquire motels, and a constant low level of new quality listings coming onto the market. The only factor holding the market back has been the lack of quality product available to meet such elevated demand. Motel owners and potential sellers continued to take a hold position rather than sell and take the gain, creating a buying market that remains truly unsatisfied.
The dynamics of the motel market generally mirror the overall health of the motel industry. Elevated occupancies and sustained demand for accommodation typically align with high demand to acquire motels. Throughout 2025, market activity consistently demonstrated resilience. Strong to high occupancy rates were achieved, supporting increases in room tariffs, often implemented multiple times throughout the year. Regional variations did appear, driven by local economic conditions, but overall demand was substantially bolstered by ongoing strength in the resources sector, corporate expansion requiring labour, and widespread government investment at all levels.
Looking back, the close of 2024 was exceptionally busy. Enter 2025, and while significant buyer enquiry continued, the available stock of quality motels remained an issue. Supply diminished further as the year progressed. High enquiry levels were driven by serious buyers seeking quality motel investment opportunities, as well as newcomers wanting to enter the industry.
The second quarter saw steady activity, with earlier enquiries converting into transactions. Many deals faced delays due to complex finance approvals and other unforeseen issues. Demand for leasehold properties strengthened, with many contracts attracting “back-up” buyers ready to move should primary contracts fall over. Continuing a trend from 2024, when finance hurdles were common, investors increasingly self-financed their acquisitions. This dynamic marginalised financially sensitive buyers, allowing stronger, well-capitalised investors to dominate the market. While most interest remained focused on freehold tenure, demand for leasehold properties continued to rise.
The third quarter maintained this momentum, with constant enquiry levels. Investor migration from the southern states into Queensland continued, with strong interest in motels, resorts and caravan parks. Transactions ranged from smaller leasehold agreements starting around $200,000 to substantial freehold properties. Significantly, assets that had been on the market for extended periods for various reasons began to attract renewed engagement.
The final quarter of 2025 was marked by sustained activity and strong enquiry. Properties that had been listed for longer periods finally moved under contract. Combined with owners choosing to retain assets due to strong trading results, this led to a further depletion of available accommodation businesses. New quality listings did not replenish the market, generating significant pent-up demand. Buyers who had previously delayed their decisions found it increasingly difficult to source suitable assets. As seen in late 2023 and 2024, transactions were often competitive, with multiple investors pursuing the same asset. The old saying “when it rains, it pours” rang true in our office this year — as soon as a listing drew interest, more buyers appeared. As a result, buyer demand was not fully absorbed, and investors continue to seek new opportunities.
Looking ahead to 2026, the industry outlook is highly optimistic. We expect sustained strong demand for accommodation assets, supported by continued strong trading performance across the sector. Existing owners are anticipated to maintain or increase their level of investment, and we foresee a growing inflow of capital from non-industry sources moving into the accommodation market.
We at Queensland Tourism and Hospitality Brokers (QTHB), along with our Partners and staff, are grateful for the support received from the industry this year. We wish everyone in the accommodation sector a safe, prosperous and enjoyable 2026.
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