Almost half of new five-star hotels in Spain are being built in Andalucia, an eye-opening report has revealed.

According to EY-Parthenon’s new Hotel Property Telescope 2026, the southernmost region accounts for 39 of Spain’s 99 planned five-star hotel projects.

The region will also add 4,107 new five-star rooms – more than 40% of the country’s future luxury hotel capacity.

It comes amid a push for ‘higher quality’ tourists in holiday hotspots like Malaga – which recently announced plans to forbid any new hotels unless they are at least four stars or more.

Cities like Sevilla, too, are appealing to more ‘luxury’ visitors, in particular high-spenders from China, Japan and North America.

The shift has been sparked by a growing anti-tourism movement across Spain, which is seeing more and more locals demand a cap on the number of visitors flocking to their towns.

This year, Spain is on track for another record number of foreign tourists, with the total expected to exceed 100 million – but for some residents it’s far from good news.

They say the more tourists who come, the more pressure is placed on everyday life and resources, including water.

Now, governments in saturated destinations are looking to keep profits high without having to ship in more visitors – hence a shift to the luxury market.

Luxury boom gathers pace

Andalucia currently has 147 hotel projects in the pipeline, representing 32% of all hotel developments planned in Spain, with 13,640 new rooms under construction.

Nearly two-thirds of those projects – 97 hotels – will be in the four and five-star categories, accounting for 10,005 new rooms, or almost three-quarters of all planned hotel capacity in Andalucia.

‘The Andalucian hotel market is clearly positioning itself in the highest-quality and most profitable segments,’ said Alvaro Monreal, Director of Strategy and Transactions for Real Estate at EY-Parthenon.

‘The growth we’re seeing is not simply about adding more hotels, but about transforming the region’s tourism product towards higher-quality, more distinctive experiences.’

Global hotel brands investing

The pipeline includes projects linked to some of the world’s best-known hospitality brands, including Four Seasons, Hyatt, Eurostars, Thompson, Mercer, OD Hotels, Yurbban Hospitality Group, Fuerte Group Hotels, IHG, H10 and Sercotel.

Among the most high-profile developments is the Four Seasons hotel currently under construction in Sevilla’s Plaza Nueva, which will become the brand’s first property in Andalucia.

Existing hotels also being upgraded

The luxury expansion is not limited to new developments.

The report identifies 48 major hotel refurbishment projects across Andalucia, covering 7,441 rooms, with 35 of those renovations involving four and five-star hotels.

Nearly 89% of all refurbished rooms will be in the premium hotel sector, reflecting growing investment in modernising existing properties to appeal to higher-spending visitors.

Combined, Andalucia has 195 hotel development and refurbishment projects underway, affecting more than 21,000 hotel rooms.

EY-Parthenon says the next challenge for the sector will be maintaining profitability as operating costs rise and travellers become increasingly demanding.

‘The challenge will not simply be to keep growing, but to turn that growth into sustainable value,’ Monreal said.

Spain attracts €2.4bn in hotel investment

The report also highlights Spain’s continued appeal to investors, with the country’s hotel sector attracting €2.4 billion in investment during the first half of 2026, despite slower activity elsewhere in Europe.

Domestic investors now account for around 65% of hotel investment, while specialist investors and family offices continue to increase their presence in what remains one of Europe’s strongest-performing tourism markets.

Read more Andalucia news at the Spanish Eye.