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Analysis

Hungary: running the show in Central Europe

In 2017, Hungarian hotels continued to benefit from increases in occupancy rate by 1.8 points to 76.2%.

Hungarian chains represented 107 establishments and 18,897 rooms on January 1, 2018. The chain supply resumed its growth (+2.1%), after four consecutive years of decline. In Hungary, the hotel chain supply is dominated by the mid-range segment, which accounts for 43.8% of the customer base, and the market is dominated by the local group Danubius .

It should also be noted that average daily rates were up significantly in 2017 (+9.8% on average), allowing the RevPAR to gain 12.5% over the year, and to stand at €65.3 including tax. It is thus the highest among the CEECs, ahead of the Czech Republic and Poland. It has also clearly exceeded its pre-crisis level. Finally, the occupancy rate reached a historic level, exceeding 76%, on average across the year.

Budapest launched a large number of real estate projects in 2017, including the construction of the new Agora Budapest business district, and the Vaci Greens Office Complex was completed in March 2018.

The Hungarian capital is increasingly attractive to international customers, particularly German, Russian, British, Czech and Italian. Due to the development of low-cost airlines, the city is also welcoming an increasing number of young tourists with limited budgets who stay at budget hotels and youth hostels.

The city accounts for almost two thirds of the country's chain supply. After a year of stagnation, its chain network grew significantly in 2017 (+7.6%) and had 12,585 rooms as of January 1, 2018. Combined occupancy rates across all categories in 2017 stood at 77.3% (+ 1.5 points). The increase amounts to nearly 11 points in 5 years. After an already strong year in 2016 (+6%), prices continued to rise (+10.1%) and reached 28,772 HUF (approx. 88€). Taking all categories together, RevPAR gains 12.3% to HUF 22,240.

Find all our analyses and details of the supply and performance of Eastern and Central European countries in the European Hospitality Report 2018, available on our store.

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