Canada hotel transaction volume down 26%

The full-service segment represented half of that trade volume with $475 million in transactions with an average price per key of $283,000. Focused service volume was $238 million with an average price per key of $228,000, while limited-service volume was $250 million with an average price per key of $110,000.

The report said strong operating performance and ample capital availability continue to drive hotel investment activity, with several transactions across key metro areas, including Toronto, Vancouver, Montreal and Ottawa, closing in the second quarter. Investor confidence remains high and is fueling robust pricing across all service segments.

Heightened competition and strong valuations have driven favorable sell-side conditions, though limited product availability continues to constrain deal flow, with more buyers than sellers in the market.

Looking ahead, several large-scale transactions have already closed in the third quarter, surpassing total Q2 volume. Based on the current pipeline, Colliers forecasts year-end transaction volume to approach $2 billion, in line with 2024 levels.

Canada’s major markets have fueled $550 million of hotel transactions, accounting for nearly 60% of year-to-date volume. The report said investor interest is growing in Alberta, British Columbia and Quebec, though activity is constrained by the limited availability of hotels for sale. Alberta accounted for 18% of national volume, followed by British Columbia and Quebec at 10%, led by high-value transactions in the Calgary, Vancouver and Montreal metro areas. Ontario remains dominant, representing 52% of national transaction volume, driven largely by trades in the Toronto area.

Hotel sales in Eastern Canada represented $695 million of volume and 55 hotels, while Western Canada represented $268 million and 17 hotels.

Performance-wise, hotels in Canada in the first half of 2025 had an average occupancy of 69.7% (up 0.9% YOY), ADR of $216 (up 2.5%) and RevPAR of $150 (up 3.4%). Domestic air passenger traffic was up 5.2% YOY, while international inbound traffic was up 3.3% and transborder traffic was down 4%.