Our 2019 H2 Market Reports are available by clicking on the links below.
ESTON International assisted in finding a new HQ for the tech-giant
The US-based LabCorp life sciences company, whose drug development segment is known as Covance, successfully completed the acquisition of Chiltern in 2017. The aim was to strengthen their position as a global life sciences company with leading diagnostics and drug development businesses. A change of this size in a company’s life requires office expansions, change management and relocation. The two companies, Chiltern and Covance, were initially located in Allee Corner and Canada Square. Neither of these locations were able to fulfill the requirements after the merger. As a best option, the two companies decided move to a new joint location that offered a larger office area and a higher level of service and ESTON International was the partner selected to identify the new location. The optimal solution was the Residence Offices situated in District II. The property was chosen due to the excellent location, the level of service, and the leasable area, all of which perfectly suited the client. The move-in to the new 600 sq m office was completed in March 2019. The Residence Office Buildings belong to the LFPI Group that represented on the Hungarian market by FLE GmbH.
Lendületben az irodapiac – derül ki az ESTON új kutatásából
A budapesti bérirodák piacán dinamikus kereslet-bővülésnek lehettünk tanúi az elmúlt három évben. A szakértők szerint ennek még nincs vége.
2018-ban rekord szintre emelkedett a budapesti bérirodák iránti kereslet: az összes kiadott terület meghaladta az 530 ezer négyzetmétert; erre korábban csak 2015-ben volt példa. Piaci szereplők osztják a véleményt, hogy a növekedés dinamikája szükségszerűen csökken a közeljövőben, de a részleteket nézve úgy látszik, a coworking irodák új lendületet adhatnak a kereslet bővülésének.
Salamon Adorján, az ESTON International Zrt. vezérigazgatója szerint a nagyobb szolgáltatók már jelen vannak a budapesti irodapiacon, de a verseny a jövőben tovább éleződik. „Tapasztalataink szerint az Egyesült Államokban és a Nyugat Európában már bevált formula itthon is egyre nagyobb népszerűségnek örvend, és a korábban 1500-2000 négyzetmétert kereső szolgáltatók ma már jóval nagyobb, akár 4-5 ezer négyzetéteres bérleményeket keresnek operációjuk biztosítására. Közismert, hogy a jelenlegi piaci helyzet nem igazán kedvez a nagyobb bérlőknek, hiszen mozgásterük elsősorban a még építés alatt álló irodaházakra korlátozódik.” A szakember szerint lenne igény arra, hogy Budapest dinamikusabban zárkózzon fel a nyugati trendekhez, hiszen egyre több cég ismeri fel, hogy hatékonyságának növeléséhez a munkavállalói igények kiszolgálásán át vezet az út. A coworking irodaterek jellemzően elsődleges lokációkon, kiválóan megközelíthető épületekben találhatók, ahol az irodai munka mindig újszerű, igényes és változatos környezetben zajlik. A kulcs a rugalmasság, a legfőbb felhasználók lendületes start-up vállalkozások, vagy akár multinacionális nagyvállalatok, ahol sok tevékenységet projekt-feladatként delegálnak.
Bővebben az alábbi kutatásból olvashat a jelenlegi iroda-, ipari-, és befektetési piac helyzetéről:
In the first half of 2018 office areas of around 75 thousand square meters were handed over in five office buildings, which surpasses last year’s volume (5,500 m²) significantly. The main parts of the new areas were finished on Váci Street (about 60 thousand square metres). The biggest newly handed over building is Promenade Gardens (22,500 m²).
The building of further new office buildings, about 462 thousand square metres, has started; out of this 168 thousand square metres could be handed over until the end of the year (10 buildings). The office stock of Váci Street will probably surpass one million square metres in 2020. This means that the current office stock (25% of the market) will remain the largest sub-market in Budapest.
Industrial and logistics property market
Until the middle of 2018 new halls were handed over in three logistics parks with a total area of over 30 thousand square metres (out of which 25,691 m² is warehouse and 4564 m² offices). The size of the area handed over is significantly smaller (30%) than it was a year ago, but the completion of more, big sized units is being planned until the end of the year. The biggest new handed over building is located in Inpark Páty, and is used as a warehouse by Euronics (12,200 m²).
The major part of the 113 thousand square metre logistics property (100 thousand m²), which is being developed, is expected to be handed over this year. By this the annual development volume will grow by 11% compared to 2017. The biggest growth can be expected in Üllő Airport Logistics Center; here 85 thousand square metres can be used by tenants in the two halls before the end of the year.
In the first quarter of 2018 economic growth in Hungary grew by 4.4% compared to last year’s result. This is one of the most significant GDP growth measured in the EU. In the January-May period performance grew in several fields: industry (3.1%), construction industry (6.9%) and tourism (number of guests: 7.1%, income of commercial accommodation: 11%). Inflation in the first half of the year stood at 2.3%; in case of durables deflation could be seen. Labour-market indicators continued to improve; unemployment rate fell to 3.7%, employment rate increased to 69.1%. Average net income surpassed by 12.1% last year’s data in the January-May period. Base rate stills stands at 0.9%, the Hungarian forint weakened significantly compared to the euro (HUF/EUR 328.6).
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In the first quarter of 2018, two new buildings were handed over with the size of 18,020 sq m: a 11,020 sq m warehouse in East Gate Business Park, and a 7,000 sq m hall in the next phase of Budapest Dock Szabadkikötő building C. Furthermore, one existing building was included in the stock due to adequate quality and occupational status; the second building of Logicor’s Fehérakác property raised the industrial stock with 4,400 sq m. The total modern industrial stock in Budapest and its surroundings stood at 2,068,900 sq m at the end of Q1 2018.
Total demand amounted to 103,790 sq m in Q1 2018, marking a 45% increase over the figure noted in the same period last year. Lease renewals accounted for 72.7% of the quarterly volume, while the share of new leases was 21.8%. Expansions stood for 5.5% of the quarterly volume. No pre-lease agreement was signed in the first quarter of 2018. 24 leasing transactions were recorded in the first quarter, out of which two agreements were signed for more than 10,000 sq m. The average transaction size was 4,320 sq m during the quarter, which is one and a half times the average level of the previous five years’ first quarters. 98% of all leasing activity was recorded in logistics parks, where the average transaction size was 4,620 sq m, while the average deal size in city logistics schemes equalled 1,075 sq m.
The two largest transactions of the quarter were lease renewals. HOPI at Goodman Gyál Logistics Centre renewed its contract on 21,700 sq m, while in Prologis Park Budapest – Sziget Schneider Electric signed a lease renewal for 19,960 sq m. The largest new lease agreement amounted to 7,000 sq m and was signed in Budapest Dock Szabadkikötő. The largest lease expansion was recorded in Prologis Park Budapest – Batta on 4,180 sq m.
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The Hungarian economy grew at a fast pace, by 4.2%, in 2017 (GDP growth at the middle of the year was 3.7%). The country’s economic performance is middle ranking among central European countries, which is higher than the EU average (2.4%). Investments showed growth (16.7%) again following the setback last year. Building industry’s activity grew significantly, by 30%, in comparison with last year. Strengthening building activity resulted in higher prices: the price index of the building industry was 8.4% for buildings in 2017 (in 2016 this figure was 4.3%)
The volume of residential property buildings grew by one fifth compared to last year, in Budapest the number of completed flats grew more significantly, by 56%. The volume of flat handovers is expected to continue to increase in 2018, on the other hand it can be seen that the number of new developments decreased as a result of the approaching deadline of the new, reduced VAT rate for purchasing new flats, which is to be introduced in the near future.
The expansion of retail trade turnover was similar to last year (4.9%), the growing trend is expected to continue in 2018 due to the increase of net income. Consumer prices grew by 2.4% in 2017.
Rate of unemployment dropped to 4.2% in 2017, which is one percentage lower that the figure in the previous year. Employment rate grew by 1.6% to 68.2% compared to last year. Shortage of labour can be seen in more fields (e.g.: construction industry, production industries), in addition, the rate of unemployment shows significant differences regionally. Base rate has not changed since the middle of 2016 (0.9%).
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Hungarian economy produced a strong growth of 3.7% in the first half of 2017 compared to last year (when the growth was at 1.7% in the same period). The volume of investments grew significantly compared to the low base rate (by 34%); growth could be observed in every area of the economy, investments in the construction industry grew by 49%. Industrial output grew by 5.6% in comparison with the January-June period last year, whereas construction industry grew by an even bigger (27%) rate. Construction of residential properties increased by 46% in the first six months (compared to last year). The number of building permits and simple notifications has increased by 40% in Hungary, and it has doubled in Budapest. As a result of the easement of building permits and the state subsidies (CSOK –state subsidy provided for families, reduced VAT) provided for residential properties the strong increase in building residential properties is likely to continue in the following year. Costs of constructions showed continuous increase in the examined period, prices increased by 8% in the second quarter in comparison with the same quarter last year.
Retail trade continued to expand: the rate of growth was 3.9% in the January-June period compared to the previous year (in 2016 it was 5.3%). Consumer prices grew by 2.3% in the first six months compared to last year, while the rate of annual growth was 1.9%. The biggest rate of inflation could be seen in case of alcoholic drinks and tobacco products.
Unemployment rate dropped below 5% (4.3), in addition employment rate increased to 68.1%. There is a big difference regionally in the unemployment rate, there is a shortage of labour at the more significant industrial areas. The National Bank has not modified the base rate since the middle of 2016, it stands at 0.9% at present.
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2016 brought an outstanding growth in property investment volume; the sum of deals doubled comparing to 2015 as it approached 1.55 billion euros. This is the second largest amount ever recorded in the Hungarian market.
High quality office buildings continue to be the most wanted; several such properties were sold over EUR 50 million. German investors are active in this segment again; additionally, domestic real estate funds successfully closed many valuable deals as well. The upcoming scarcity of premium offices became apparent by the end of 2016. According to the expectations forward purchase agreements will return to the market.
Domestic real estate funds still have a great appetite int he EUR 30-50 million price range; the Diófa Fund Manager and the Erste Real Estate Fund were active buyers, just as they had been in the previous year.