New Delhi, June 22 (IANS) Spending by Indians on experiences — recreational and cultural activities, restaurants, hotels and travel — is expected to outpace spending on physical goods between 2025 and 2030, a report said on Monday.

During this period household expenditure on physical goods is likely to grow at a 9.1 per cent compound annual growth rate, while broader experiential spending will likely grow at 10.3 per cent CAGR, the report from real estate services and investment firm CBRE Research said.

The spending on hotel accommodation is expected to grow at an even sharper 10.6 per cent CAGR.

With relatively low lifestyle hotel penetration compared to regional markets, India offers substantial potential for developers and investors, particularly through the repositioning and conversion of existing independent hotel assets.

Gen Z travellers demand striking, curated design environments that double as social media backdrops, personalized service that avoids corporate predictability, and activated communal spaces that host experiences such as wine tastings, acoustic performances, and local cultural events.

Wellness integration and seamless technology from self‑check‑in to smart‑room automation are now expectations rather than differentiators.

A new category, the lifestyle hotel, is emerging to meet this demand, combining the design and local character of an independent property, backed by the operational scale, distribution networks, and loyalty programs of an institutional brand.

The report highlighted that the shift toward experiences was accelerated by the COVID‑19 pandemic and sustained by pent‑up demand since 2022.

The trend is being primarily driven by Generation Z, which currently accounts for the largest demographic bloc across the Asia Pacific region and their spending is forecast to expand faster than any other living generation.

The overall hotel supply across the Asia Pacific region grew at a steady 5 per cent CAGR between 2015 and 2025. However, lifestyle hotels grew at 19 per cent over the same period. The supply of lifestyle hotels is projected to maintain a 10 per cent CAGR till 2030, five times the 2 per cent growth forecast for the broader hotel market.

“For property owners and institutional investors, the lifestyle hotel segment represents a compelling double-win: measurable RevPAR and ADR premiums over standardized assets, and a capital-efficient conversion pathway that maximizes long-term asset value,” said Anshuman Magazine, Chairman & CEO – India, South-East Asia, Middle East & Africa, CBRE.

The report highlighted that upper upscale lifestyle hotels across Asia Pacific in 2025 commanded a 13 per cent revenue per available room (RevPAR) premium over traditional properties in the same category.

Upscale lifestyle brands added a further 7 per cent premium, achieving this despite smaller room sizes by generating stronger food and beverage revenues and running leaner operations.

—IANS

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