Indian consumers are on course to spend more on experiences — including travel, hotel stays, restaurants, and recreational and cultural activities — than on physical goods between 2025 and 2030, according to a report released on Monday, 22 June by real estate services and investment firm CBRE Research. The shift marks a structural reorientation of household spending priorities, accelerated by the COVID-19 pandemic and sustained by pent-up demand since 2022.

The Numbers Behind the Shift

Household expenditure on physical goods is projected to grow at a 9.1 per cent compound annual growth rate (CAGR) over the five-year period. Experiential spending, however, is forecast to expand at a faster 10.3 per cent CAGR. Within that category, hotel accommodation stands out with an even sharper projected growth rate of 10.6 per cent CAGR — the fastest-growing sub-segment tracked in the report.

The findings point to a widening gap between goods and experiences as a share of Indian consumer wallets, a trend that mirrors — and in some metrics, outpaces — patterns seen across the broader Asia Pacific region.

The Rise of the Lifestyle Hotel

A new hospitality category is emerging at the centre of this demand surge: the lifestyle hotel. These properties combine the design sensibility and local character of independent boutique hotels with the operational scale, distribution networks, and loyalty programmes of institutional brands. Across Asia Pacific, lifestyle hotels grew at a 19 per cent CAGR between 2015 and 2025, against an overall hotel supply growth rate of 5 per cent over the same period.

Looking ahead, lifestyle hotel supply is projected to maintain a 10 per cent CAGR through 2030 — five times the 2 per cent growth forecast for the broader hotel market. In 2025, upper upscale lifestyle hotels across Asia Pacific 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.

What Gen Z Wants — and Why It Matters

The report identifies Generation Z as the primary driver of the experience economy, currently accounting for the largest demographic bloc across the Asia Pacific region. Gen Z spending is forecast to expand faster than that of any other living generation. Their hospitality expectations are reshaping the sector: striking, curated design environments that double as social media backdrops; personalised service that avoids corporate predictability; and activated communal spaces hosting wine tastings, acoustic performances, and local cultural events.

Wellness integration and seamless technology — from self-check-in to smart-room automation — are now baseline expectations rather than differentiators, the report noted.

India's Investment Opportunity

With relatively low lifestyle hotel penetration compared to other regional markets, India presents substantial potential for developers and institutional investors, the report said. A particularly capital-efficient route identified is the repositioning and conversion of existing independent hotel assets into lifestyle-branded properties.

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

As India's middle class expands and Gen Z earners enter peak spending years, the structural case for experience-led hospitality investment appears set to strengthen through the decade.