PwC: 2025 Hospitality M&A Dips

Merger and acquisition activity in the hospitality industry thus far in 2025 has declined year over year, according to a new PwC report. 

Using S&P Global Market Intelligence data, PwC in its midyear M&A outlook determined that the total value of deals in the hospitality and leisure sector consummated in 2025 through May 15 were valued at less than $4 billion combined, less than half the value of such deals in the first two quarters of 2024.

PwC cited several factors for the M&A slowdown, including "high borrowing costs, valuation mismatches and policy uncertainty." 

"Tariff uncertainty and trade headwinds are complicating cross-border activity," according to PwC. "Domestic-focused and service-oriented [hospitality and leisure] operators remain better positioned for dealmaking."

Hospitality and leisure deals backed by private equity in particular have slowed in 2025, according to PwC. Specifically, private equity backed deals comprised 7 percent of total hospitality and leisure transactions so far in 2025, compared to just 43 percent year to date in 2024, according to the company. That indicates "financial buyers have largely stayed on the sideline, while strategic players remained active for strong assets," according to PwC.

Overall deal volume in all industries in 2025 has stayed roughly flat year over year, according to PwC.

Looking ahead, PwC suggested prolonged economic volatility could bring additional underperforming hospitality assets to the deal block, and "clarity on interest rate policy and trade developments" could "shape valuation confidence, transaction pacing and ultimately consumer sentiment toward travel."

Still, some level of M&A remains. For example, Hyatt Hotels Corp. this week closed the acquisition of all-inclusive resort chain Playa Hotels & Resorts for $2.6 billion, which it announced in February.