Benchmark International

The Real Estate Sector

The global real estate market grew at a compound annual growth rate (CAGR) of 7.4%, from $4.02 trillion in 2023 to $4.31 trillion in 2024. This expansion can be attributed to robust economic growth in emerging markets, an increased demand for affordable housing, specific government initiatives, and an uptick in disposable incomes. The real estate market is forecast to grow to $5.67 billion in 2028 at a CAGR of 7.1%. This future growth will be due to increasing investments in infrastructure, rising populations, growing urbanization, and declining interest rates. Developed economies are projected to see stable growth, while emerging markets are expected to grow slightly faster. Increasing demand for construction activities will continue to be a key driver of the development of the real estate industry.

Key trends expected in the global real estate sector include:

• Use of blockchain for more straightforward transfers and more significant customer         control over property transactions
• Data analytics to gain insights into market trends, pricing, and customer preferences
• Use of AR (Augmented Reality) and VR (Virtual Reality)
• Artificial intelligence (AI) technology for projecting rental prices and determining               house prices
• Increased adoption of alternative payment methods so that customers may pay rent       using credit

The industry is segmented by:

• Residential (houses and apartments)
• Commercial (offices, retail, warehouses, industrial)
• Real estate agencies
• Construction companies
• Accommodation services
• Commercial real estate leases and transactions
• Publicly owned government buildings 
• Public healthcare buildings

The Lodging Sector

The global hotel market is projected to reach revenue of $446.5 billion in 2024. Between 2024 and 2028, a compound annual growth rate (CAGR) of 3.32% is forecast, resulting in a projected market volume of $508.9 billion.

In 2024, global hotel investment volume will exceed the previous year by 15% to 25%. The most highly sought hotel assets will continue to be irreplaceable luxury properties. Also, hotel assets in the select-service and extended-stay sectors will garner high interest. This trend can be attributed to increasing global wealth and an ongoing convergence of living          and traveling.

Future growth in the market will be attributed to critical trends such as: 

• Sustainability initiatives
• Wellness tourism
• Flexible booking options
• Collaboration with local communities
• Health & safety standards
• Artificial intelligence
• Contactless technologies
• Personalized guest experiences
• Digital marketing and social media influence

The Leisure Sector

The global leisure travel market was valued at $1.46 trillion last year and is forecast to grow at a robust CAGR of 21.8% to reach $5.8 trillion by 2030. 

It is a dynamic and evolving industry in which technology is playing a critical role. Increasing digitization and globalization are the key factors driving the growth of the leisure travel industry worldwide. AI and cloud-based services enable more efficient processes, such as online booking, leading to better user experiences and increased productivity. More chatbots and virtual assistants are also being used. Smart hotels and connected devices are personalizing in-room experiences and streamlining operations. 

There will be increasing public and private investments in the tourism industry because it includes other sectors, such as food & beverage, transportation, and logistics. 

The important trends in the leisure sector include:

• Online booking platforms, travel apps, and other tools
• There is a growing demand for personalized, unique travel experiences
• Awareness of environmental issues and the importance of eco-friendly and socially           responsible travel choices
• Valuing experiences over possessions
• Health and wellness tourism 
• Solo travel 
• Alternative accommodations (such as Airbnb)

Millennials dominate the leisure travel market at around 35% to 40% due to their population size, disposable incomes, and travel habits. They are tech-savvy and adventure-seeking and prioritize authenticity and cultural immersion, which is driving trends in the industry. Generation Z is a rapidly growing segment with a 20% to 25% market share. They live digital lives on social media, are environmentally conscious, and seek budget-friendly options. Gen Z is quickly gaining on Millennials, and their distinct preferences will continue to shape the sector in the coming years. Generation X also holds a 20% to 25% share. They seek options offering relaxation, family time, and value, such as beach trips, cruises, or all-inclusive travel.

M&A

Nearly 70% of commercial real estate executives expect returns to decline in the next few years. Such demand for transformation means that real estate M&A is expected to surge     in 2024. Several factors will drive real estate M&A in 2024, including business transformation, innovation, and investment activity. Other trends shaping the commercial real estate market include low office demand, the desire for transformation in business models, and distressed properties. Additional key drivers for M&A in the real estate sector include climate change opportunities and digital transformation, with 60% of executives prioritizing digital commerce opportunities in 2024.

In 2023, casinos began leveraging their real estate assets by selling stakes to real estate investment trusts (REITs) to fund potential M&A deals, a trend that is expected to continue. Generative AI will be among the leading hotel technology trends in 2024. Hotels use it to enhance operational efficiency, create new marketing campaigns and segments, improve employee job performance, and offer superior customer experiences. Adding this technology may drive the need for M&A strategies.

The global luxury travel market is predicted to reach $440.4 billion by 2030. Luxury and unique experiential trips are expected to lead travel trends in 2024. Growing interest in luxury and lifestyle hotels has caused hotel companies to increase their development in this space. Hotel conversion will be prioritized over new construction in 2024, as it is a fast and cost-effective way to scale up their portfolios in a tight lending market.

While hybrid work models have made single-purpose business trips less frequent, 2024 could be a significant year for the meetings industry as corporate events resurface. In 2023, there was a 10% increase in U.S. corporate events volume and a 12.3% rise in the U.S.’s top 25 markets. Companies are focused on organic growth via strategic alliances and creative partnerships, such as loyalty programs and omnichannel experiences that increase distribution and create lasting customer value.

Americas: Sam Smoot at +1 (813) 898 2350 / Smoot@BenchmarkIntl.com

Europe: Michael Lawrie at +44 (0) 161 359 4400 / Lawrie@BenchmarkIntl.com

Africa: Anthony McCardle at +27 21 300 2055 / McCardle@BenchmarkIntl.com 

ABOUT BENCHMARK INTERNATIONAL:

Benchmark International is a global M&A firm that provides business owners with creative, value-maximizing solutions for growing and exiting their businesses. Benchmark International has handled over $11 billion in transaction value across various industries from offices across the world. With decades of M&A experience, Benchmark International’s transaction teams have assisted business owners with achieving their objectives and ensuring the continued growth of their businesses. The firm has also been named the Investment Banking Firm of the Year by The M&A Advisor and the Global M&A Network as well as the #1 Sell-side Exclusive M&A Advisor in the World by Pitchbook’s Global League Tables.

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