«The hotel and tourism sector in Mongolia continues to show positive dynamics: according to the National Statistical Committee, the sector's revenue for the first nine months of 2025 increased by 22.3% compared to the same period in 2024, amounting to ₮277.8 billion,» reports InsideMongolia.
📈 Record growth over 3 years
Since 2022, the total income of the sector has increased from ₮208.3 billion to ₮320.9 billion in 2024, which corresponds to a growth of 54% over three years. From 2022 to 2024, the average annual growth rate was about 24%, indicating a sustainable trend rather than a temporary recovery after the pandemic.
🛏️ Unclassified hotels drive growth
The growth of the sector is mainly driven by unclassified hotels, which generate the largest share of accommodation revenue. In particular, revenue from unclassified hotel services increased by 58.5%, reaching ₮167.2 billion in 2024 compared to the previous year. In the first 9 months of 2025, they generated ₮146.3 billion, which is almost equal to the total revenue for all of 2022. This growth is attributed to an increase in domestic tourism, length of stay, and flexible accommodation options, rather than the emergence of new elite properties.
⭐ The premium hotel segment has slowed its development: meanwhile, the segment of hotels with 3 stars and above increased from ₮95.3 billion to ₮143.7 billion from 2022 to 2024, reaching ₮123.8 billion in early 2025. Although expansion continues, it is still limited by production capacities and high operating costs.
⚠️ Two-star hotels are in trouble: The annual turnover of two-star hotels remains around ₮10 billion, placing them in a difficult position between budget options and more expensive brands, raising concerns about their long-term competitiveness.
🏚️ Structural capacity constraints
Despite the positive results, the hotel sector in Mongolia faces serious structural constraints, especially in the off-season. The country has 492 hotels, 486 guesthouses, and 922 tourist camps, providing a total of about 35,560 overnight accommodations. However, seasonal fluctuations reduce supply: of the 145 winter camps registered, only 55 are actually open, offering just 3,500 beds in high-demand urban areas.
Overall… In Ulaanbaatar, there are international hotels of 4 and 5 stars, such as Shangri-La, Kempinski, Best Western, Novotel, and Pullman, but during peak months from June to September, there is a shortage of rooms, highlighting the existing gap between supply and demand for high-quality accommodations.
