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Prague is the Czech Republic’s industrial, political and financial centre and is an important gateway to Central and Eastern Europe. It is considered a predominantly leisure destination, but increased business activity and meetings, conferences and events over the last few years are indications of its improving international profile and of the further potential of the commercial segment. The city is primarily a spring, early summer and autumn destination. Success has been achieved in developing the city as a short-break destination and as part of the Vienna-Budapest-Prague triangle travel route. The city is also a weekend-break destination all year round, particularly around Christmas. Affordable hotels and a high proportion of discount airlines servicing the city make it an attractive destination for stag parties and the like, and although the city does have a plethora of historic and cultural attractions, it generally lacks the high-end shopping and culinary experiences that tend to attract luxury tourists.

Prague’s visitors are primarily foreign tourists, traditionally constituting 85% of total visitation. The primary foreign source countries for Prague are Germany, the USA and the UK. The most notable growth in visitation in recent years was achieved by Chinese tourists. Owing to the greater weight of leisure demand in Prague, the city’s visitation, overnight demand and occupancy are somewhat more pronounced than in other city destinations. The market’s high season for leisure runs from the Easter weekend to September, while March, April, June, September and October typically have strong commercial and MICE demand. Increasing visitation to the city is reflected in the growing occupancy and average rate in the years leading up to the pandemic. Prague recorded a compound annual growth rate (CAGR) for occupancy of close to 2.5% from 2014 to 2019, and a CAGR for average rate of a staggering 5.0%, in euro prices. In 2022, after the pandemic, both occupancy and average rate recovered significantly, as a  result of a very strong end to the year, with Q4 being close to 2019 levels in RevPAR terms. 2023 continued in that direction with occupancy increasing by a third. Average rate were also in a strong recovery path, with over 10% growth, and therefore back to 2019 levels, in real terms. These dynamics resulted in a RevPAR around 6% higher than that of 2019 in nominal terms (though 10% below in real terms due to the impact of inflation over this period).

Prague’s pipeline remains modest, with only around a 1.7% increase in rooms expected over the next few years; most of the new projects fall into the upscale and luxury categories. Some of these new openings  include the 221-room Novotel Prague Geone (March 2026), the 160-room PURO Hotel Prague (May 2026) and the 40-room Six Senses Liv Nordic Prague (December 2026).

After three years with little-to-no transactions for hotels in Prague, the city recorded four hotels changing hands in 2023: the 95-room Hotel Vitkov and the 50-room Hotel Sovereign, both sold for undisclosed sums; the 40-room Clara Futura Hotel sold for a reported €12.6 million (€315,000 per key); and the 161-room Courtyard Prague City sold as part of a four-property portfolio for an allocated price per room of €238,000 (€38.3 million).

Our HVI analysis indicates a marketwide increase in hotel values of around 4.7% in euro prices and 4.3% in Czech koruna. Prague was one of the most impacted cities in Europe in terms of RevPAR decline in 2020 but is now on a steady path for recovery. With the limited new supply and the healthy post-pandemic growth in visitation, a full recovery of this market is expected in the short term.

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

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Change In Value For Market: (€Euro)

Prague RevPAR Change (€Euro)

Prague 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 Associate [email protected] ++44 0 7736273439 (m)