Selling a Boutique Hotel: Understanding What works and what blocks

The boutique hotel market continues to attract strong interest, with active investors and numerous projects under review. However, behind this apparent momentum, closing transactions has become more complex than it may seem.

Between sellers’ expectations, buyers’ requirements and the operational realities specific to each asset, achieving alignment has become more nuanced.

In this interview, Xavier Albérini, founder of Carlton Hotelbrokers, shares a direct perspective on the market and on the mechanisms that now determine the success of hotel transactions.

How would you describe the boutique hotel market today?

The market is clearly active.

There is strong interest in boutique hotels, particularly because they meet a more experiential and differentiated demand compared to standardized hospitality.

We receive a significant number of inquiries, serious interest and structured projects.

However, what is striking is that this dynamic does not always translate into completed transactions.

How do you explain this gap between market interest and deal completion?

The market is not blocked by a lack of buyers.

It is blocked by the difficulty of achieving alignment.

Today, a project must work across all dimensions: pricing, financing and operations.

And this overall balance is more complex to reach than it used to be.

Does this mean the market has become more selective?

Yes, significantly.

Buyers are still active, but they are far more demanding.

They take the time to analyze, compare and arbitrate between opportunities.

A deal must be immediately clear.

If the positioning is not obvious or the potential is not evident, they move on.

What continues to attract investors to boutique hotels?

It remains a segment with strong potential.

A well-positioned boutique hotel can generate value relatively quickly, whether through repositioning, pricing strategy or guest experience.

There is still meaningful upside on certain assets.

But this value creation must be credible.

Today, no one invests based solely on assumptions.

Where do discussions typically break down?

The main issue is the difference in perspective between sellers and buyers.

On the seller side, there is often a strong emotional dimension.

A hotel is not just an asset. It is a history, a life project, sometimes years of investment. This naturally influences the perception of value.

On the buyer side, the approach is much more rational.

They think in terms of returns, ratios and financing capacity. They analyze performance, margins, required capex and project a return on investment.

That is where the gap emerges.

Has this gap become more pronounced?

Yes, clearly

With higher financing costs, buyers have become even more disciplined.

They can no longer absorb pricing discrepancies as they sometimes could in the past.

Every line of the business plan is scrutinized.

There is also another key factor, particularly on the French Riviera and in many leisure destinations.

Not all hotels operate under the same model.

A 50-room seafront hotel or a year-round urban property do not follow the same dynamics.

In many destinations, the model is seasonal. Some hotels close several months per year, and their economic balance is built around this seasonality.

This is fully aligned with the local market.

However, it can conflict with the approach of hotel groups used to year-round urban assets with stable annual performance.

They may analyze these properties using a framework that is not adapted to the asset or its market.

This can create misunderstandings and, ultimately, prevent transactions.

Does valuation play a central role in these issues?

Very often, yes.

We frequently see pricing expectations that are not fully aligned with what the market can sustain today.

Not because the asset lacks quality, but because market conditions have changed.

And when pricing prevents the buyer from building a viable project, discussions stop.

What are the most common valuation mistakes?

A frequent mistake is applying residential logic to hotel real estate.

Some owners rely on price per square meter or residential comparables.

This is understandable, but it does not apply to hospitality.

A hotel is fundamentally an operating asset.

The value of the real estate is directly linked to the business performance and the level of rent the operation can sustain.

This is an economic logic, not a residential one.

What defines a deal that works today?

Clarity.

A clear location,

a well-defined positioning,

and financials aligned with the market.

It does not need to be perfect, but it must be understandable and credible from the outset.

What makes the difference in a sales process today?

Selling a hotel is no longer about simply putting it on the market.

You need to understand the asset, its real business model, and identify the right buyer profile.

Not all assets fit all investors.

A seasonal asset on the French Riviera will not be analyzed the same way as a year-round urban hotel.

If it is presented with the wrong framework, the right buyers may never engage.

Our role is to structure this alignment.

Position the asset correctly, adjust expectations when needed, and create the conditions for a deal to happen.

How do you see the market evolving?

The market will continue to evolve towards more structure.

Buyers will remain active but selective.

And successful deals will be those built — or repositioned — with a clear operational logic.

Today, you are no longer selling a property.

You are matching a project with a buyer who can make it work.

That alignment is everything.

“A hotel is not sold for what it represents to its owner, but for what it can become for its buyer.”