The pool at Mama Shelter Singapore, a design-focused lifestyle brand under Accor. Gen Zs are turning to such hotels for the unique design, experiential service and lively public spaces. (Photo: Samuel Isaac Chua/EdgeProp Singapore)
Lifestyle hotels — design-led properties that trade standardised comfort for local character, experiential programming and social spaces — are still a less common sight in Asia Pacific (Apac). But that is changing quickly, with a single demographic driving much of the shift.
Gen Z, already the region’s largest population cohort, is emerging as the key demand force behind the segment’s rapid expansion, and their rising spending power is likely to amplify this influence by 2030, according to a CBRE research report.
For investors, the real estate consultancy reckons that the confluence of Gen Z demand, underpenetrated supply and a growing pool of conversion-ready assets makes the lifestyle segment a compelling opportunity in regional hospitality.
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Lifestyle hotels are defined by three main attributes: a design-centric property with a strong visual identity usually rooted in local culture; highly personalised and experiential service with unique elements; as well as lively, flexible public spaces that encourage social interaction, and unique F&B offerings.
This format aligns closely with how Gen Z approaches travel. They prioritise experiences, community exploration, visual appeal and social media trends, and are inspired by their “tribe” or peer group. Being digital natives, they discover options and book exclusively through digital channels.
Gen Zs also have no strong attachment to any brand and are constantly seeking new and unique experiences. This stands in contrast to older generations, which often stick to specific brands or seek benefits from loyalty programmes, going by CBRE’s analysis.
Table: CBRE Research
Given these preferences, the cohort often chooses to stay in lifestyle hotels because of the distinctive, striking designs that allow for diverse brand expression even within the same portfolio, unlike standard business hotels.
Despite having a slightly smaller room footprint than other hotels in the same grade, lifestyle hotels focus on “conspicuous design touches” that attract attention and can bring about a memorable and shareable guest experience, the report notes.
The focus on activities in this segment also means that guests can often participate in the likes of wine tastings, live music events and authentic local experiences. Public spaces and “distinct ambiences and narratives” within lifestyle hotels are designed to encourage social integration and connection among guests as well as with the local community, CBRE adds.
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Wellness offerings and technology also appeal to Gen Z. Examples include gym facilities, fitness classes and healthy dining options, alongside self check-in and smart-room functions.
Born between 1997 and 2010, the cohort made up one-quarter of Apac’s population last year — larger than all other cohorts, including Millennials at 23% and Gen X at 20%. By 2030, Gen Z is forecast to make up a bigger proportion of the region’s population, at 27%.
However, although it is the largest demographic cohort, their current spending lags that of older generations because Gen Zs are either still studying or only just beginning their careers.
Despite having lower spending power than Gen X and Baby Boomers for now, they are already making their presence felt through different spending patterns. Gen Zs are gravitating towards lifestyle hotels, while other cohorts prefer traditional ones.
As more in this cohort become financially independent, global overall spending by Gen Z is forecast to grow at 27.6% between 2024 and 2030, the strongest rate of any generation.
CBRE predicts that their tastes and requirements will exert a stronger influence on the hotel sector as their spending power increases.
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CBRE predicts that Gen Z’s tastes and requirements will exert a stronger influence on the hotel sector as their spending power increases (Photo: CBRE)
“With Gen Z increasingly valuing culture, design and seamless technology, the [lifestyle hotel] segment is well-positioned for sustained growth,” says Ananth Ramchandran, the firm’s head of advisory and strategic transactions for hotels and hospitality in Asia.
He adds that lifestyle hotels are among the fastest-growing segments in the global hospitality industry.
In Apac, these brands have expanded rapidly over the past decade. The supply of lifestyle hotels in the region has increased at a CAGR of 19% from 2015 to 2025. That is almost quadruple the pace of growth of total hotel supply in Apac, which posted a 10-year CAGR of around 5%.
Despite this momentum, lifestyle brands are still underpenetrated within Apac. Penetration rate — calculated as the number of lifestyle hotel rooms divided by the total number of hotel rooms in the market — stands at 1% in the Apac region, compared to 2% in Europe and 4% in the US.
This is because the concept originated in Europe and the US; lifestyle brands were only introduced to Apac much later. That said, the development pipeline indicates a tilt towards such brands globally. In Apac, the pipeline penetration rate is 8%, and includes all projects under construction, final planning and proposed, up until 2030.
“Amid an environment where land and development costs continue to rise and owners are coming under increasing pressure to maximise efficiency, the economics of lifestyle brands are extremely compelling,” the report states. The upcoming supply of lifestyle hotels in Apac continues to outpace the market average.
Moreover, hospitality groups have been expanding their lifestyle footprint to the upper-mid and midscale categories. While these concepts have primarily targeted the luxury and upscale segments, they have in recent years expanded into lower-tier chain scales as operators look to capture demand from guests with varied budgets.
Within the region, Singapore and Hong Kong are among those with the highest lifestyle hotel penetration rates, as hotel owners in these markets are generally more willing to take on new brands.
Chart: Costar, CBRE Research (May)
This is partly due to intense competition, which makes introducing new brands a common strategy to drive bookings, while hotel groups also use these markets to track the performance of new lifestyle concepts before expanding their footprint regionally.
Penetration rates are low in mainland China, India and Japan, where local hotel groups dominate and the presence of global brands is limited. Growth in international lifestyle brands in these markets remains slow.
Green Leaf Niseko Village in Japan. Part of Hilton’s Tapestry Collection, it features local art, natural onsen baths and cuisine highlighting Hokkaido’s seasonal produce. (Photo: Hilton)
Apac hotel investment transactions are increasingly concentrated in smaller independent assets, while rising construction costs are also pushing owners toward conversions.
In 2020, about 31% of total hotel investment volume comprised deals under US$100 million. This share grew to 39% in 2024, then to 42% in 2025.
Independent hotels — which are privately owned and operated and have no affiliation with a major hotel chain or brand — made up about 30% of the assets traded during the 2024–2025 period.
Chart: MSCI Real Capital Analytics, CBRE Research (April)
CBRE believes that smaller independent assets may provide attractive value-add and opportunistic plays for conversion to lifestyle brands if the properties are redesigned and renovated.
At the same time, conversions are becoming a popular and capital-efficient alternative as increasing construction costs hinder new development plans in Apac.
“While new builds are still preferred for creating unique and contemporary lifestyle designs, excessive costs are directing investors’ focus to conversions,” CBRE says.
The consultancy recommends investors evaluating the segment to look for market “white space” by identifying underserved segments and performance gaps, and to balance brand-driven design with long-term asset value considerations.
They will also need to align their assets with community needs to drive social interaction, finding optimal F&B and public space solutions that match the asset’s positioning.
Finally, CBRE suggests that asset owners should not forget third-party operators. While nascent in Apac, and especially in Southeast Asia, third-party operators can often provide a more bespoke and competitive offering as compared to brand-managed options, it adds.
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