Familiar faces, key players of the market, exciting topics, and relevant insights – this is how the 20th Property Investment Forum is unfolding.
We’ve gathered some interesting takeaways from the presentations heard so far.
Budapest’s appeal remains strong in the international real estate market 🏢
At the conference, Norbert Schőmer, CEO of Atenor and President of RICS, emphasized that Hungary is a popular and livable place, making it a smart choice for future real estate developments.
Gábor Borbély, Head of Research at CBRE, pointed out that in the Central and Eastern European region, the office sector remains the leader (30%), with logistics overtaking retail in second place, and the hotel sector also showing significant growth.
The Budapest Office Market:
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Miklós Ecsődi, Director of Tenant Representation at Colliers, highlighted that tenants currently have the upper hand, as the vacancy rate in Budapest exceeds 10%.
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The average transaction size is 800 m², and there are long waiting lists for top-quality green office buildings, while there is a shortage of available ESG-compliant green spaces.
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Pre-let rates for new developments are at 45–50%.
Challenges of ESG Compatibility:
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While the concept of ESG is well understood at the corporate level, the definition of ESG-compliant buildings is still unclear.
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There are no standardized measurement systems or fixed KPIs for buildings yet, as ESG originally started as a corporate rating system and was not designed specifically for the built environment.
Development Directions and Challenges:
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Forum participants emphasized that digitalization of the construction industry, improving efficiency, and incorporating sustainability principles are critical and urgent priorities.
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These are likely to be key factors for future developments.
What Does the Future Hold?
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According to Miklós Ecsődi, vacancy rates could remain as high as 20% for the next 2–3 years.
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Gábor Angel, Deputy CEO of Wing, stressed that finding ESG-compliant, high-quality offices is increasingly difficult in the current market.
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Due to ongoing uncertainty, new office developments are slowing down, and renovating existing buildings is often more cost-effective than launching new projects.
Budapest has a total office stock of 4.5 million square meters, but rents for new developments would only be viable in the A+ category, starting at €20/m² per month – and in the current market environment, this does not ensure sufficient return on investment.