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Budapest is the capital of Hungary and the 15th largest city in the EU by population. The city traditionally had a strong industrial focus, but has since become a major centre for banking, finance, real estate and accountancy. Budapest is home to almost 420,000 companies in 2024, including the first foreign office of the China Investment Promotion Agency (CIPA) and the European Institute of Innovation and Technology (EIT). Major multinational firms with headquarters in the city include the Fortune 500 company Mol Hungarian Oil & Gas, OTP Bank Group, Magyar Telekom and many others. Budapest is also a cultural and historic centre, which makes it very leisure oriented, with well-known monuments such as St Stephen’s Basilica, the Hungarian Parliament Building, Buda Castle, the Chain Bridge and the Opera House. As such, the city has gained international recognition as a ‘must-see’ destination in Europe, which translated into strong performance levels for hotels in the pre-pandemic years.

The city has welcomed an ever-growing number of arrivals, both transient passengers and cargo aircraft; this has been largely possible given the new routes now offered by many low-cost airlines travelling to Budapest. Overall arrivals achieved a compound annual growth rate (CAGR) of 7% between 2009 and 2019, almost doubling in that period, reaching 4.6 million arrivals in 2019. Prior to the pandemic, the combination of hotel performance and airport arrival levels allowed Budapest to outperform regional competitors such as Vienna, Prague, Bratislava and Warsaw in terms of growth. Since its recovery from the 2009 downturn, Budapest’s hotel market enjoyed constant year-on-year RevPAR growth at an almost double-figure compound annual rate in local currency (2010-19), with 2014 and 2015 standing out as particularly successful years. During the pandemic, hotels faced lengthy closures and Hungary’s borders remained closed for tourism for prolonged periods. In 2022, Budapest’s marketwide occupancy more than doubled compared to the previous year, and the average rate increased by more than 10%; however, the RevPAR remained some 25% below the pre-pandemic level, in 2019 prices, as the market struggled to attract some of its key source markets owing to the war in Ukraine. In 2023, hotels demonstrated significant progress in RevPAR, narrowing the gap to only 2% below 2019 levels. This was achieved thanks to double-digit recoveries in both occupancy and average rate over the year.

Budapest’s pipeline is quite substantial with around 2,800 rooms due to enter the market in the next few years, representing some 10% of the current supply. The new supply includes two luxury properties: the 108-room St. Regis Budapest (November 2025) and the 152-room Almanac Budapest (January 2026). Internationally branded hotels in the luxury and lifestyle categories should further boost Budapest’s standing as a destination in the near future.

There was little hotel transaction data in Budapest in 2020, with the most relevant being the sale of the Sofitel Chain Bridge by Starwood Capital to Indotek (price undisclosed) and the NH NY Palace and NH NY Residence sold as part of a European portfolio of eight hotels (allocated sales price per key of €410,000 for each hotel). In 2021, transactional activity shrunk further to only one hotel: the 50-room Escala Hotel & Suites for an undisclosed sum. Two transactions took place in 2022: the sale of the 130-room ibis Styles Budapest City in September and the 234-room Hotel Gellert in December, with undisclosed sales prices for both. The only sale recorded in June 2023 was the 357-room Sofitel Chain Bridge, for an approximate price of €232,000 per key, in June.

Overall, our HVI analysis indicates modest value progression for Budapest, with an increase of 0.8% in 2023 compared to 2022. However, since the forint strengthened against the euro, the value in local currency recorded a decrease of almost 2.0%. The market fundamentals in Budapest remain strong, and we are confident in the city’s ability to continue to recover in the coming years.

ADR, Demand, Occupancy, RevPAR, and Supply Projections:

ADR Change
Market Demand Change
Hotel Occupancy Increase/Decrease
RevPAR Change
Market Supply Growth

Change In Value For Market: (€Euro)

Budapest RevPAR Change (€Euro)

Budapest RevPAR (€Euro)

For more information, please contact:

	Sophie Perret, MRICS, MBA Managing Director [email protected] +44 0 2078787722 (w) +44 0 7725781037 (m)
	Julia Dzerkach Associate [email protected] +44 0 2078787742 (w) +44 0 7912240964 (m)
	Clemence Sennavoine Senior Associate [email protected] ++44 0 7736273439 (m)