Hughes sympathises with Schwarzer
"It's a great opportunity for him," Hughes said.
"It's not often you get the chance to go and play for one of the top four teams in the country, especially when you're down to the last few years of your career."
Arsene Wenger has, so far, been unsuccessful in his attempts to lure the veteran goalkeeper to Emirates Stadium with a £2 million bid rejected from the Fulham board.
And Hughes admits that, although losing their most consistent performer would be a huge blow, it is an opportunity that Schwarzer cannot turn down.
"You can understand why Arsenal want to take him and why it's important for him. If he went we'd miss him, but we wish him well. It's a fantastic opportunity."
With Fulham aiming to build on a historic season which saw them reach the Europa League final under previous manager Roy Hodgson, Hughes concedes that it is a difficult situation the club now find themselves in with much of last season’s success attributed to the Aussie shot-stopper.
"Mark has been one of the top three keepers in the league for the last two years. He's been very important to us.
"Some of his saves kept us in games. Sometimes if you have a successful season it's harder afterwards and you almost find yourselves hanging onto your players rather than trying to build on your success."
By Paul Wentworth