Budapest to move ahead with major rail upgrade as Southern Circle Railway tender launched

Budapest is set to take another significant step in modernising its rail network after the Hungarian government officially launched a public procurement procedure for the third phase of the Southern Circle Railway (Déli Körvasút) project. The long-anticipated development is widely described as the largest railway investment in the Hungarian capital for more than a century.

Huge development for Budapest

The open tender, published in the EU’s official procurement bulletin shortly before Christmas, covers both the design and construction of the third phase of the project.

Interested bidders have until 16 February 2026 to submit their offers to the Ministry of Construction and Transport, headed by János Lázár. The winning contractor will have 44 months to complete the works, meaning the project could be finished between 2028 and 2029, writes VG.

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Southern Circle Railway enters its third stage

The third phase focuses on the Pest side of the Southern Circle Railway and centres on a major capacity expansion around Ferencváros railway station. According to the tender documents, the project will affect a 3.9-kilometre section of the national rail network, requiring the preparation of detailed construction plans, the acquisition of all necessary permits and the full execution of the approved designs.

As part of the investment, Ferencváros station will be comprehensively rebuilt. Nearly 12 kilometres of existing track will be dismantled, while 13.2 kilometres of new track will be laid.

The project also includes the construction of more than 51 kilometres of overhead electric lines, alongside extensive upgrades to signalling, telecommunications systems and high-voltage power infrastructure.

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Already existing buildings will be renewed as well

Several key transport structures will also be renewed or newly built. The railway bridges along Üllői Road will be reconstructed, while a brand-new railway bridge will be erected above Gubacsi Road, complete with lifts to improve accessibility.

In addition, three pedestrian underpasses will be created at Üllői Road, Balkán Street and in the Balkán Park area to enhance safety and connectivity for local residents.

Another important element of the third phase is the construction of the new Népliget railway stop, which will feature two platforms and barrier-free access. This new station is intended to improve public transport links in one of Budapest’s busiest districts and better integrate rail services with other modes of urban transport.

One of the largest projects in Hungary

The Southern Circle Railway development forms part of a wider, multi-stage programme to expand and modernise the Kelenföld–Népliget rail corridor, one of Hungary’s busiest railway sections.

Alongside the Budapest–Belgrade line, it ranks among the country’s largest rail projects, with total costs running into several hundred billion forints. The European Union has already contributed substantial funding, including more than HUF 100 billion in recent years.