A joint-stock company was established by the hotel owners, including the chairman Mr. Frigyes Glück and architect Mr. Rezső Ray, which purchased the largest piece of real estate on the developing Grand Boulevard, which was becoming the main artery of the capital city.

The Grand Hotel Royal opened 30 April 1896, to serve visitors attending the Millennium Exhibition, which celebrated the 1000th anniversary of crowning the first Hungarian king.

After its opening, the Royal became a regular haunt of contemporary Hungarian writers and journalists, including Jenő Heltay, Sándor Hunyadi, Lajos Nagy and Gyula Krúdy.

Several classical concerts were held in the Royal Ballroom, and Béla Bartók, the Hungarian composer, frequently conducted music there.

The hotel was again badly damaged during the 1956 Hungarian Revolution, when organizers of the revolt gathered in the building, and Soviet tanks shelled it on 4 November 1956.

The Hungarian communist government rebuilt the hotel with completely modern interiors, designed by architect István Janáky, that fit with the 'space idealism' of the time.

[citation needed] The original visitor's book contains the signatures of some of the most important people from Europe and the rest of the world.

Just a few examples are Max Reinhardt, Asta Nielsen, Saljapin, Valdemar Psylander, Professor Barnard, Roberto Benzi, Mario del Monaco, Anna Moffo, Renata Scotto, Elisabeth Schwarzkopf, Amerigo Tot, Valentina Tereskova, Jane Napp and Kristo Priimägi.