Dive Brief:
- Global travel and tourism sector deal activity declined roughly 8% year over year in the first half of 2025 amid economic uncertainty, according to new findings from data and analytics company GlobalData.
- During H1, venture financing and private equity deals in the travel and tourism sector declined around 25% and 20%, respectively, while merger and acquisition activity contracted 3.5% year over year, according to the report. The U.S., Germany and China all saw a decline in deal activity during the half.
- The subdued deal activity “suggests that dealmakers are becoming increasingly cautious likely due to the macroeconomic challenges and volatile market conditions,” Aurojyoti Bose, lead analyst at GlobalData, said in a statement. As market dynamics and investor sentiment shift, financial buyers will reshape their strategies, Bose noted.
Dive Insight:
The H1 decline “underscores a broader trend where macroeconomic factors and investor sentiments are reshaping deal-making strategies within the industry,” Bose said, adding that there is “a dent in investor sentiment” and a broader trend of reduced risk appetite.
The decline comes as market volatility riles international travel, with inbound travel to the U.S., specifically, negatively affected by recent U.S. government actions, according to the World Travel & Tourism Council.
Hospitality dealmakers similarly showed cautiousness in the first half of the year, with private equity-sponsored hospitality deals in the U.S. dropping 85% year over year, PwC reported in June.
Financial buyers in the hospitality sector largely stayed on the sidelines in H1 due to high borrowing costs, President Donald Trump’s tariff policy shifts and worsening global travel sentiment, according to PwC.
Hospitality dealmakers will reevaluate certain markets, segments and operational approaches as they look to expand in the near term, PwC hospitality leads shared with Hotel Dive in June.
During the NYU International Hospitality Investment Forum that month, multiple hotel CEOs noted that India, specifically, is ripe with growth opportunities.
Despite deal activity declines elsewhere in H1, the Asia-Pacific region experienced deal volume growth of 11%, with India and Japan showing notable improvement, GlobalData found.
