CEE Hospitality Marketbeat Report H1 2025

Hotel investment volumes in the CEE-6 region reached €682M in H1 2025, up 364% year-on-year and the highest level since 2019. This was primarily driven by strong activity in the Czech Republic, which led the region, followed by Poland and Hungary. Most deals involved Upper Upscale assets, with Luxury properties next in line. Notable transactions included PPF Real Estate’s acquisition of the 791-room Hilton Prague and, together with Noble Hospitality, the Four Seasons Prague; NREP’s purchase of the two-hotel Noli Studios portfolio in Gdansk; and Yellow Tree Holdings’ acquisition of the Hilton Garden Inn Bucharest Airport. This positive momentum is expected to continue through the second half of 2025 and into 2026, supported by numerous transactions in the pipeline and new opportunities set to enter the market.

Throughout the first half of 2025, prime yields in the CEE hotel market held relatively stable, with prime assets in key locations experiencing some yield compression. As transaction activity continues to rise and market liquidity improves, driven by the entry of private investors with more flexible investment criteria, further yield tightening is expected in H2 2025.

The region saw a notable 9.3% increase in RevPAR compared to H1 2024, primarily driven by a 6.9% rise in ADR. Meanwhile, occupancy also improved by 3.4 percentage points, reaching 65% in H1 2025 (6.5 pp. behind 2019 levels). The RevPAR index for all CEE capitals exceeded 2019 levels, with Warsaw (138.9%), Sofia (128.4%), and Prague (125.5%) at the forefront. Warsaw and Sofia stand out as the only cities to have surpassed 2019 occupancy levels, reaching indices of 104.6% and 100.2%, respectively.

In H1 2025, approximately 20 hotels and serviced apartment projects were completed across the CEE-6 capitals, delivering an additional 1,600 rooms to these markets (+1.7% YoY supply growth). This was driven primarily by Warsaw (+3.8%), Prague (+1.8%) and Bucharest (+1.7%). Development activity was concentrated in the Luxury and Upscale segments, which recorded the most substantial supply growth. Notable openings included the Fairmont Golden Prague and the Corinthia Grand Hotel Bucharest. Looking ahead, further supply growth is anticipated over the next six months, with Budapest expected to lead the way.