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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 to be predominantly a 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 2020 and the first half of 2021, the pandemic resulted in the market experiencing single-digit occupancies, while the second half showed some signs of recovery. In 2022, both occupancy and average rate recovered significantly, ending up with a triple-digit increase in RevPAR compared to 2021 (above 250%). This was the result of a very strong end to the year, with Q4 being close to 2019 levels in RevPAR terms.

Prague’s pipeline remains modest, at around a 4.0% increase over the next few years, with most of the new projects falling into the upscale and upper upscale categories. Nevertheless, some notable new openings are on the horizon for the city. The expected new hotels include the 523-room Hard Rock Hotel Prague (Q1 2024), the 40-room Six Senses Liv Nordic Prague (Q1 2024) and the 297-room Fairmont Prague (Q3 2024). In 2022, the market remained quiet in terms of hotel transactions with no hotels being sold.

Our HVI analysis indicates a marketwide increase in hotel values of around 2.0% in euro prices. Prague was one of the most impacted cities in Europe in terms of RevPAR decline in 2020, but is showing promising signs of recovery. With the limited new supply and the healthy pre-pandemic growth in visitation, a rebound in performance to pre-COVID levels is expected by 2024.

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

ADR Change
Market Demand Change
Hotel Occupancy Increase/Decrease
RevPAR Change	0.0%	0.0%
Market Supply Growth

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)