In this article, we present a real-time 3D hybrid beamforming approach for 5G wireless networks. One of the key concepts in 5G cellular systems is the small cell network, which settles the high mobile traffic demand and provides uniform user-experienced data rates. The overall capacity of the small cell network can be enhanced with the enabling technology of 3D hybrid beamforming. This study validates the feasibility of 3D hybrid beamforming, mostly for link-level performance, through the implementation of a real-time testbed using a SDR platform and fabricated antenna array. Based on the measured data, we also investigate system-level performance to verify the gain of the proposed smart small cell system over LTE systems by performing system-level simulations based on a 3D ray-tracing tool.