How Much Does It Cost to Buy a Hotel (2026 Data)

A hotel room in the United States changed hands for an average of $211,000¹ in 2025, and a new one cost a median of $212,958² to build, land, furniture and fees included. The average sale price and the median build budget come within $1,958³ of each other per room, but the average build budget, $472,476², is 2.2³ times the average sale price. The paths behind those numbers differ too: sale prices are 51%³ below their 2021 peak, while the prices of goods that construction firms buy rose 11.2%⁴ in the year to September 2026 alone. A whole hotel is a much bigger number: the average sale above $10 million was a $38 million¹ deal, and a new 250-room Westin needs $90.7 million⁵ or more before anyone buys the land.

This page puts the two prices side by side and then takes them apart: sale prices per room since 2019, development budgets by hotel class and by line item, hard construction costs per square foot in 18 US cities, the franchise fees and investment ranges of 18 hotel brands, and the payroll and royalties that come with owning a hotel. The surprises are in the spread: a luxury room costs eight times a limited-service room, a square foot of five-star hotel in San Francisco can cost almost five times a square foot of three-star hotel in Phoenix, and most US hotels are small workplaces: 67.5% have fewer than 20 employees.

How much does it cost to buy a hotel?

In 2025 the average US hotel sold for $211,000¹ per room. That figure covers every single-hotel sale above $10 million: 392¹ sales worth nearly $15 billion¹ and covering about 70,700¹ rooms. It does not cover sales below $10 million, so it describes mid-size and large hotels rather than roadside motels.

The price per room fell 13%¹ from $243,000¹ in 2024. More deals closed (up 10%¹), each with more rooms on average (180³ against 165³) but fewer dollars, $38 million¹ against $40.2 million¹ a year earlier. By quarter, the average was $225,000¹ per room in the second quarter, about $207,000¹ in the third and about $212,000¹ in the fourth.

The longer series shows how much the market has swung. The average price per room was $364,000⁶ in 2019, fell to $273,000⁶ in 2020 as travel stopped, and jumped to $431,000⁶ in 2021, the highest of the seven years shown. Since then it has slid every year. The 2025 average is 42%³ below 2019 and half of the 2021 peak.

The number of sales tells a different story from the price. Deals above $10 million fell to 79⁶ in 2020, recovered to 481⁷ in 2022 and settled at 392¹ in 2025, more than twice the 164⁶ of 2019. Dollar volume peaked at $36.2 billion⁶ in 2021 and has stayed between $12.8 billion⁷ and $19.9 billion⁷ since. In other words, more hotels are trading than before the pandemic, but at lower prices per room.

Money followed the same arc as the deal count, with one difference: the 2021 peak in dollars came a year before the peak in the number of sales, and 2021 was also the year of the highest price per room⁶.

How much money do I need to buy a hotel building?

For a mid-size or large hotel, the average answer in 2025 was $38 million¹, down from $40.2 million¹ in 2024. The range around it is wide. The highest prices per room were paid for luxury hotels in Florida and New York: The Ben in West Palm Beach sold for $190 million¹ with 208¹ rooms, more than $900,000 a room, and the New York EDITION for about $235 million¹ with 273¹ rooms. At the other end, two big convention hotels in San Francisco with about 3,000¹ rooms sold together for $408 million¹, roughly $140,000 a room.

Florida and California together accounted for 42%¹ of the dollar volume in the last quarter of 2025.

How much is a hotel worth?

In 2025 the average US hotel room sold for $160.54⁸ a night and was occupied 62.3%⁸ of the time, which works out to about $36,506³ of room revenue per available room per year. The 2025 average sale price per room equals about 5.8³ years of that national average room revenue. The hotels sold for more than $10 million are larger and more upscale than the national average, so 5.8 years is only a rough national benchmark, not the multiple paid for any one hotel.

How much does it cost to buy a small hotel?

The national sales survey counts only sales above $10 million, so it gives no average for small hotels¹. Small hotels are, however, most of the market by number. Of the 55,895⁹ hotel and motel establishments with paid staff in 2023, 37,722³ employed fewer than 20 people, or 67.5%³. Only 785⁹ had 250 or more employees.

For a small hotel, the build-cost figures below and the room revenue above are the closest guides to price.

How much does it cost to build a hotel?

The median US hotel project budgeted in 2025 cost $212,958² per room, counting everything from the land to the developer's fee. The average was much higher, $472,476², because a handful of luxury projects pull it up; the median is the better guide for a typical hotel. The class of hotel matters more than anything else. A limited-service hotel had a median cost of $196,975² per room, and a midscale extended-stay hotel $169,901².

A full-service hotel cost $467,244², 2.3³ times a select-service hotel at $200,730². A luxury hotel cost $1,604,356² per room, 8.1 times a limited-service hotel.

These are budgets from real projects proposed or under construction in 2025, concentrated in Florida, Texas, New York, North Carolina and California². Limited-service and extended-stay hotels made up more than half of the projects, which is why the median per room was slightly lower than in the previous year's survey even though construction costs kept rising.

How much does it cost to build a hotel room?

Per room, the answer runs from about $170,000² to $197,000² for the limited-service and midscale extended-stay hotels that dominate new building, around $265,000² for upscale extended-stay and more than $1.6 million² for luxury. Averages run higher than medians in every class except midscale and upscale extended-stay, because a few expensive projects raise them: the average full-service hotel cost $595,252² per room and the average luxury hotel $1,961,964².

How much does it cost to build a 100-room hotel?

Multiply the per-room medians by 100. A 100-room limited-service hotel comes to about $19.7 million³ at the median, and a 100-room hotel at the all-project median about $21.3 million³. A 100-room luxury hotel at the luxury median would cost about $160.4 million³. Real projects rarely sit exactly on a median, and the development process typically lasts three to five years², so budgets should be raised for inflation over that time.

How much does it cost to build a small hotel?

Per room, a small hotel is not cheaper to build. At the limited-service median, a 50-room hotel comes to about $9.8 million³. In the brands that publish budgets for two hotel sizes, the building cost per room of the smaller of the two prototype sizes is equal to or higher than that of the larger one^{10 11 12 13}.

How much does it cost to build a luxury hotel?

Luxury, the top class of hotel, is a different business. The median luxury project cost $1,604,356² per room, of which $916,919² was building and site work, $371,645² soft costs such as design, permits and financing, and $138,317² furniture, fixtures and equipment. Many recent luxury projects include residences, which raises the cost per hotel room². Land alone cost $129,935² per room, 10.9³ times the land cost of a midscale extended-stay hotel at $11,886².

The percentage of total cost for building a hotel

Across all projects, the building and site work take 65%² of a hotel's development budget. Soft costs (architects, engineers, permits, financing, legal and other fees) take 15%², land 11%², furniture, fixtures and equipment 6%², the developer fee 2%² and pre-opening costs and working capital 1%². The split barely moves between classes: building and site work range from 63%² for full-service hotels to 68%² for upscale extended-stay hotels. The exception is soft costs, which reach 18%² in luxury projects.

The average cost of furnishing a hotel room

Furniture, fixtures and equipment (FF&E) had a median cost of $20,105² per room across all projects. It ranged from $16,079² in limited-service hotels to $36,752² in full-service hotels and $138,317² in luxury hotels, 8.6³ times the limited-service figure. Brand standards give a similar picture: furniture and fixtures alone are budgeted at $12,500¹⁰ to $17,100¹⁰ per room in a new Fairfield by Marriott and $34,800⁵ to $44,500⁵ per room in a new Westin.

A brand's own furniture budget is a second check on these medians. For a newly built hotel, the midpoints of the furniture and fixtures estimates run from $14,050 to $39,650 per room, rising with the class of the brand.

Hotel construction cost per square foot by city

Hard construction costs - the building itself, without land, design fees or furniture - depend heavily on the city. In the third quarter of 2026 a three-star hotel cost from $235²⁷ per square foot at the low end in Phoenix to $700²⁷ at the high end in San Francisco. Five-star hotels started at $440²⁷ per square foot in Austin and reached $1,150²⁷ in San Francisco ($12,379³ per square meter). The costliest cities for three-star hotels were San Francisco, Honolulu and Portland, and for five-star hotels San Francisco and Honolulu; the cheapest for three-star hotels were Phoenix, Las Vegas and Los Angeles.

Five-star hotels cost more everywhere, but the ranking of cities shifts: Honolulu comes close to San Francisco, and Austin rather than Phoenix is the cheapest²⁷.

The full ranges show how wide the spread inside a single city can be. In San Francisco the five-star range runs from $600 to $1,150 per square foot, a spread of $550 within one city.

How much does it cost to build a hotel in Texas?

Texas is one of the cheaper places to build. A three-star hotel cost $315²⁷ to $465²⁷ per square foot in both Austin and Dallas in the third quarter of 2026 ($3,391³ to $5,005³ per square meter), and a five-star hotel $440²⁷ to $605²⁷ in Austin and $450²⁷ to $620²⁷ in Dallas. Texas also had 6,253²⁸ hotels and motels in 2025, second only to California, and it was one of the five states with the most projects in the 2025 development cost survey².

How much does it cost to open a hotel franchise?

A franchised hotel comes with the franchisor's published estimate of the initial investment¹⁰. For a newly built hotel, excluding land, permits, insurance and contingencies, the 2025 estimates for 18 brands range from $12.0 million¹⁰ for the low end of an 80- to 110-room Fairfield by Marriott to $166.2 million²⁶ for the high end of a 300-room Renaissance. The midpoints in the chart show the step between classes: select-service and extended-stay brands have midpoints from $16.5M to $33.1M, and full-service and collection brands with 200 to 300 rooms from $77.5M to $134.2M.

The fees paid to the franchisor are a small part of that. The application fee for a new hotel is $75,000¹⁰ for brands such as Fairfield, Aloft and Four Points, $90,000¹¹ for Courtyard, Residence Inn, AC Hotels and Moxy, and $100,000⁵ for full-service brands, with extra fees per room above a set size. In total, a Fairfield owner pays the franchisor about $141,300¹⁰ to $218,200¹⁰ before opening; a Westin owner about $289,700⁵ to $383,000⁵.

How much does it cost to build a Marriott hotel?

Per room, the building alone - construction, without land, furniture or fees - is budgeted at $119,100¹⁰ to $198,500¹⁰ for a new Fairfield by Marriott, $147,100¹¹ to $245,200¹¹ for a Courtyard and $285,700⁵ to $476,200⁵ for a Westin. For a 250-room Westin, the whole investment works out to $362,635³ to $591,357³ per room, still before land. StudioRes, an extended-stay brand built to one standard design, is the cheapest to build at $87,700²⁰ to $114,000²⁰ per room.

After opening, the franchisor takes a share of room revenue every month. The royalty is 5%²⁶ of gross room sales for brands such as Renaissance, Autograph Collection and Tribute Portfolio, 5.5%¹⁰ for Fairfield, Aloft and Moxy, 6.0%¹¹ for Courtyard and Residence Inn, and 7%⁵ for Westin, which also charges 3% of food and beverage sales. StudioRes charges a single bundled fee of 9%²⁰ that includes marketing. On top of the royalty most brands charge a program services contribution for marketing, reservations and systems, for example 3.85%¹⁰ of gross room sales for Fairfield.

How much does a hotel feasibility study cost?

A market feasibility study is budgeted at $6,000¹⁰ to $18,000¹⁰ for select-service and extended-stay brands and $15,000⁵ to $25,000⁵ for full-service brands. It is one of the smallest lines in the budget and one of the earliest.

How much does it cost to start a hotel?

Starting a hotel means paying for work long before the first guest arrives. Design and professional services for an 80- to 110-room Fairfield are budgeted at $439,300¹⁰ to $989,600¹⁰, start-up costs at $2,300¹⁰ to $3,500¹⁰ per room, and the first three months of operation need another $3,000¹⁰ to $5,000¹⁰ per room in reserve. At the end of June 2026, 703,001²⁹ rooms were in the US development pipeline, but only 133,216²⁹, or 18.9%³, were under construction; the rest were scheduled to start within a year or still in early planning.

How much does it cost to own a hotel?

Owning a hotel means paying for people, the brand and the building every month. Labor is the largest of these. US hotels and motels (excluding casino hotels) employed 1,548,238²⁸ people on average in 2025 and paid them $44,552²⁸ a year on average, 37.7%³ more than in 2019. With about 25.1³ employees per establishment, the average hotel's payroll comes to roughly $1.1 million³ a year, before payroll taxes and benefits.

The brand is the second recurring cost. At the 2025 national room revenue of about $36,506³ per available room, a 5.5% royalty costs about $2,008³ per room per year, before the program services contribution. Against that, the 2025 median build cost of $212,958² per room equals about 5.83³ years of a room's revenue.

The number of hotels kept growing through the pandemic, even while jobs fell. The count rose every year from 2014 to 2025, but growth almost stopped in the last year.

Where the hotel is matters for payroll as much as for building costs. Average pay in hotels was highest in Hawaii at $69,244²⁸ and New York at $66,386²⁸ in 2025, and lowest in Mississippi at $22,715²⁸. California had the most hotels and motels, 6,366²⁸, ahead of Texas with 6,253²⁸ and Florida with 4,428²⁸.

Who owns these hotels? Most belong to partnerships or S corporations. Of the 55,895⁹ hotel and motel establishments counted in 2023, 42.3%³ belonged to partnerships, 37.2%³ to S corporations, 14.1%³ to C corporations and 5.7%³ to sole proprietors. Together, partnerships and S corporations owned 79.6%³ of all hotels and motels.

Why building a hotel keeps getting more expensive

Hotel construction in the United States runs in long cycles. Private spending on lodging construction - new hotels and improvements to existing ones - reached $35.4 billion³⁰ in 2008, collapsed to $8.4 billion³⁰ in 2011 and climbed back to $32.3 billion³⁰ in 2019. After the pandemic it fell to $18.6 billion³⁰ in 2021 and has held at about $25.4 billion³⁰ a year since 2023. In 2025 lodging spending was 28%³ below the 2008 peak in nominal dollars, and it is falling again: the first eight months of 2026 came to $15.4 billion³⁰, 10.4%³ less than a year earlier.

Set against other private building, lodging is a small line: its share fell from 6.46% in 2019 to about 3.2% since 2022, while office spending has mostly risen.

Hotels have also lost ground to other buildings. Lodging took 8.64%³⁰ of private nonresidential construction spending in 2008 and only 3.24%³⁰ in 2025, while office construction alone reached $104,269 million³⁰ in 2025. Monthly figures show 2026 below 2025 in every month from January to August.

Month by month, the 2026 slowdown is visible from January, when $1,812M was spent against $2,090M a year earlier.

Costs per project keep rising even as spending stalls. The prices of materials, energy and other goods bought by construction firms averaged 41%³ more in 2025 than in 2019 and 66%³ more than in 2008. After two calmer years they jumped again: in September 2026 they were 11.2%⁴ higher than a year earlier, and goods for nonresidential construction rose by the same 11.2%³¹. These indexes leave out labor and land, so they show only part of what a hotel budget pays for.

What the numbers mean for buyers and builders

For anyone weighing the two routes into the business, the average sale price in 2025, $211,000¹ per room, was close to the median build budget of $212,958² but less than half the average build budget of $472,476² (a median and an average, compared with an average). Median budgets for limited-service, select-service and midscale extended-stay hotels ($169,901² to $200,730²) were below the average sale price; upscale extended-stay, full-service and luxury budgets ($264,841² to $1,604,356²) were above it. The two routes also carry different risks. A buyer pays for a hotel that already has guests, staff and a revenue history; a builder pays for land, three to five years of development² and construction prices that rose 11.2%⁴ in twelve months.

New construction has slowed while sales have recovered: 392¹ hotel sales above $10 million in 2025 against a pipeline in which fewer than one room in five is actually being built.

For a first-time owner of a branded select-service hotel, the budget comes in three layers: around $12.0 million¹⁰ to $26.7 million¹⁰ to open before land, a payroll of roughly $1.1 million³ a year for an average-size hotel, and 5.5% to 6% of room revenue to the brand, plus marketing and system fees.

Conclusions

1. Building a typical hotel costs about what buying one does; building an upscale one costs far more. The average sale price, $211,000¹ per room, was close to the median development budget of $212,958² but less than half the average budget of $472,476². That median was slightly lower than a year earlier mainly because the 2025 projects were mostly cheaper limited-service and extended-stay hotels, even as construction prices rose².
2. The class of hotel decides the budget more than the city does. A luxury room costs 8.1³ times a limited-service room to develop, while the costliest city's three-star midpoint, $575³ per square foot in San Francisco, is under twice the cheapest, $298³ in Phoenix.
3. The brand's fees are small at the start and large over time. An application fee of $50,000²⁰ to $100,000⁵ is less than 1% of the investment, but a 5.5% royalty takes about $2,008³ per room every year.
4. Fewer hotels are being built just as costs jump again. Lodging construction spending fell 10.4%³ in the first eight months of 2026 while construction goods prices rose 11.2%⁴, so a new room is getting dearer to build while the average sale price per existing room fell 13%¹ in 2025.