Property First, Workouts Second in a Shrinking Hospitality Market

A general counsel at a hotel group or leisure operator who reviews a panel of hospitality law firms this year is buying into a shrinking stream of work. Sartori & Partners data show 638 hospitality and leisure deals in the 12 months to September 2026, against 698 in the 12 months before. Over the same windows the whole deal market grew from 43,590 to 48,216 deals. The mix of what is left matters more than the count: property transactions and restructuring run well above their market share, and capital markets runs below it.

Hospitality and leisure deals fell 8.6% year on year, while the whole deal market rose 10.6%. That gap is the opposite of what neighboring sectors did. Real estate deals rose 6.8% over the same windows, and consumer goods and retail deals held flat (-2.1%). Hospitality is the one of the three that moved against the market.

The calendar years tell the same story at a closer range. In the Sartori & Partners deal records, hospitality and leisure counted 698 deals in 2025 and 544 in 2026 through October, with two months still to come. Earlier years were collected from fewer firms, so the series is a guide to the recent direction, not a measure of how much the sector grew over time.

For a company buying outside counsel, a smaller deal stream changes the conversation with firms. Fewer hospitality mandates in the market means more room to ask for named partners, fixed fees on routine property work and a clear staffing plan before a matter starts.

Real estate transactions were 12.0% of hospitality and leisure deals in the past 12 months, against 2.8% of all deals. Hotels, resorts and venues sit on property they own or lease, and the deal record reflects it: property transactions show up far more often here than in the average sector.

The practice credits point the same way. Real estate lawyers worked on 10.7% of hospitality deals, 3.7 times their 2.9% share of all deals. Disputes and investigations, at 29.1% of the sector's deals, and M&A, at 22.9%, sit close to their market shares of 25.0% and 19.3%. Property is where hospitality differs.

A firm that pitches for hospitality work should show a property team that has closed hotel and venue transactions, not only a corporate team with sector clients. Ask for the real estate partners by name at the pitch.

Restructuring and insolvency was 3.2% of hospitality and leisure deals, against 1.1% of all deals, well above the market rate. The count is small, 21 deals, so the gap is a rough size rather than a precise ranking.

The practice credits confirm the direction on a slightly larger base. Restructuring lawyers worked on 4.1% of hospitality deals, against 1.5% of all deals. Consumer goods and retail, another sector that lives on discretionary spending, shows restructuring lawyers on 4.1% of its deals, a similar tilt.

For a buyer the lesson is simple. A hotel or leisure group should know which restructuring partner it would call before it needs one, and should check that the firm can staff a lender negotiation without borrowing the property team.

Capital markets was 16.3% of hospitality and leisure deals, against 25.7% of all deals, a gap of 9.4 points. Capital markets lawyers were credited on 17.8% of the sector's deals, against 26.4% across the market.

Issuance still happens: 106 hospitality deals in the past 12 months were capital markets work, more than the 78 real estate transactions. The point is relative weight. Real estate companies, the nearest comparison, put capital markets at 26.4% of their deals, close to the market share. Hospitality companies issue less often than either, so a capital markets credential should not decide a hospitality panel on its own.

Three firms share the top band in hospitality and leisure, 21-40 deals each over the past 12 months: Latham & Watkins, Barnes & Thornburg and Davis Polk & Wardwell. The next seven firms all sit in the 11-20 band. No firm stands clear of the rest.

Set against the whole deal market, the list holds a mix. Latham & Watkins ranks first both in hospitality and across all deals, and Davis Polk & Wardwell ranks second across all deals and third here. Barnes & Thornburg, second in hospitality, is not in the top 10 of the whole deal market. Because the bands are close, rank tells a buyer little: the property and restructuring partners a firm can field matter more than its place on this list.

Start the panel from the work the sector buys. Real estate transactions at 12.0% of hospitality deals, against 2.8% for the market, put a property team first. Restructuring at 3.2% of hospitality deals, well above the market's 1.1%, puts a workout partner second, named before any trouble starts. Capital markets, below the market share, belongs on the panel but should not drive the choice.

Use the falling deal count. Sartori & Partners data show hospitality deals fell 8.6% while the market rose 10.6%, so firms with sector teams have capacity. Ask for fixed fees on repeat property work, a named restructuring partner in the engagement letter, and a staffing plan that keeps the same lawyers on each hotel or venue matter.