Western Ukraine has become a hub for hotel investments in the Carpathians
Western Ukraine has become the primary destination for investment in the hotel industry. According to market data, over 80% of new investments in hotel construction in 2025–2026 will be concentrated in this region. At the same time, experts warn that the market is approaching saturation, particularly in the segment of standard hotels lacking a unique concept and developed infrastructure.
This is reported by RBC-Ukraine.
Developers are most active in the Carpathian region, Lviv Oblast, and neighboring regions
Experts warn of the risk of market oversaturation—especially in the segment of standard hotels without a clear concept or infrastructure
Lviv (57%) and Bukovel (56%) currently have the highest occupancy rates, with occupancy reaching 85–95% during the high season
In Ivano-Frankivsk Oblast, hotel industry debt for 2021–2024 has risen by 52%, indicating high indebtedness in part of the market
Only systematically managed hotels or niche conceptual projects will survive. Without a clear market strategy, it is becoming increasingly difficult to compete.
Construction is taking place where it is safer
The geographical shift in investments is primarily driven by safety considerations. Western and central regions of Ukraine remain the most attractive for developers due to lower risks and more stable tourism demand. The Carpathian region, Lviv Oblast, and adjacent territories have formed new hubs of hotel activity, which in some locations already exceed pre-war visitor numbers.
According to Ribas Hotels Group, the vast majority of new construction permits in the hotel sector will be concentrated here in 2025–2026.
Saturation Without Quality
The concentration of investments in a single region creates a new problem—competition between similar, conceptually weak projects. The most noticeable signs of oversaturation are observed in the segment of basic hotels lacking extensive infrastructure, professional management, and a clear vision.
“It is becoming increasingly difficult for such properties to compete for both investors and future guests,” explained Rostislav Khoma, head of real estate advisory services at EY in Ukraine, to RBC-Ukraine.
Lviv (57%) and Bukovel (56%) remain profitable in terms of occupancy rates, with occupancy reaching 85–95% during the high season. However, the national average occupancy rate in 2026 remains at only 25–26%. This indicates significant unevenness in demand even within the region itself.
Leverage as a Signal
Financial statistics confirm that increased construction activity does not guarantee profitability. In Ivano-Frankivsk Oblast, the debt of key players in the hospitality industry increased by 52% from 2021 to 2024. The opposite is true in Lviv Oblast, where the equity of hotel enterprises grew by 22% over the same period.
"Negative equity in the Ivano-Frankivsk region indicates that many properties—likely in resort areas such as Bukovel—are heavily indebted or operating at the break-even point due to high operating and capital costs," Natalia Tabaka, head of the State Agency for Tourism Development, told RBC-Ukraine.
What’s Really in Demand
During the market restructuring phase, guests and investors are becoming more discerning. The highest demand is for high-quality suburban and concept-driven resort projects with well-developed spa infrastructure, a children’s area, and managed by an experienced operator.
"The client isn’t buying a room, but a controlled scenario: a temporary change of location due to power outages, a workcation, or a retreat following shelling," explained real estate market analyst Viktoria Berezhchak.
Aparthotels and condo formats remain particularly attractive to investors in the SME sector. They combine the hotel model with a development approach: a lower entry threshold, risk shared among owners, and the preservation of a liquid asset.
What’s Next
As expected, developers’ main focus in the coming years will remain on the western and central regions. However, excessive product segmentation amid limited domestic demand and the virtual absence of foreign tourists risks narrowing the audience to a critical minimum.
"Most new projects aim to be more versatile in their concept, combining several usage formats," emphasized Rostislav Khoma.
According to experts, two types of properties will survive: a systematically managed facility with high operational efficiency—or a niche product with a strong concept and a clearly defined audience. Everything in between—lacking both a concept and a system—will gradually disappear.
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