From Georgia to Indiana, investors are snapping up hotels as travel rebounds and regional economies thrive. The hospitality sector just got a big confidence boost.
There’s something stirring in the American hospitality scene — and it’s not just more room service orders. Hotel transactions across several Southern and Midwestern states have jumped significantly in the first quarter of 2025. Big names, local players, and new investors alike are making bold bets in cities like Atlanta, Baton Rouge, Southaven, and Fishers.
Why the South and Midwest Are Drawing Hotel Dollars
The short answer? Growth. The long answer? Growth plus smart timing, recovering travel demand, and favorable regional economics.
Markets like Georgia and Indiana offer a sweet spot for investors right now. They’re not as saturated as the major coastal metros, but they still have solid demand drivers: airports, tech hubs, medical centers, and college towns. Add in relatively low acquisition costs compared to places like New York or L.A., and it’s clear why capital is moving in.
And this isn’t just small stuff. These are multi-million dollar transactions, often with renovation or repositioning plans attached. Hotels that were struggling post-pandemic are being picked up and polished, ready for a new chapter.
Four Key Transactions You Should Know About
Let’s break down what’s actually happening on the ground. These four recent hotel deals offer a window into the strategy behind the surge:
• Atlanta, Georgia: A major airport-area hotel changed hands in Q1. The property sits near Hartsfield-Jackson, the busiest airport in the world. It was acquired by a hospitality investment firm focused on repositioning legacy assets.
• Baton Rouge, Louisiana: A 150-room hotel in downtown Baton Rouge was bought by a regional group with ties to the oil and gas corridor. Plans for modernization are already underway.
• Southaven, Mississippi: A freshly renovated 100-room hotel in this Memphis suburb was sold at a premium, signaling strong suburban demand.
• Fishers, Indiana: Just outside Indianapolis, a mid-scale hotel property was scooped up by a Midwest-based REIT looking to expand its regional footprint.
Each deal comes with a different playbook, but the end goal is the same: long-term value and stable returns.
Numbers Don’t Lie: Hospitality is Back
For a sector that took a gut punch during the pandemic, this kind of activity is a breath of fresh air.
According to STR, U.S. hotel revenue per available room (RevPAR) grew by 6.2% in Q1 2025 compared to the same period last year. That’s not explosive growth — but it’s steady. Occupancy is holding, especially in secondary markets. And average daily rates (ADR) are inching up as consumer confidence strengthens.
Here’s a snapshot of recent hospitality metrics in these four states:
| State | Q1 2025 RevPAR Growth | Notable Drivers |
|---|---|---|
| Georgia | +7.8% | Airport travel, conventions |
| Indiana | +5.6% | Suburban tech and med centers |
| Louisiana | +4.9% | Oil corridor recovery, tourism |
| Mississippi | +6.3% | Suburban leisure demand |
Demand isn’t just coming from tourists, either. Business travel is creeping back, and infrastructure funding from federal sources is pushing more people into hotels for temporary stays and project work.
Who’s Buying and Why It Matters
It’s not just institutional giants making moves here. Smaller regional players are stepping in with precision.
One Louisiana-based investor said the post-pandemic real estate reset gave them a rare chance to acquire “cash-flowing hotels at discounts we haven’t seen in a decade.” For them, Baton Rouge wasn’t just about occupancy rates — it was about buying a well-located asset before the next tourism bump hits.
In Southaven, a hospitality group that focuses on suburban assets said they’re seeing “the strongest mid-week bookings since 2019.” That’s a sign business travel — the lifeblood of suburban hotels — is returning in a real way.
Some of these groups are buying distressed assets. Others are targeting fully operational hotels with upside potential. Either way, they’re betting big on regional resilience.
Why Investors Are So Bullish Right Now
There’s definitely a sense of urgency in the air. After three rocky years, the hospitality industry is stabilizing — and fast.
Smaller markets offer strong yield potential. The cost to acquire, renovate, and reopen is often far lower than building from scratch in a Tier 1 city. Combine that with improved travel infrastructure (new flights, road upgrades, regional investments), and you’ve got a recipe for solid returns.
And let’s not ignore inflation. Real assets like hotels offer a hedge. When room rates climb, revenue can track with broader price hikes, which makes hospitality attractive to investors watching their margins elsewhere shrink.
