Now is the time to work in construction! Orders in the building industry are experiencing continuous growth and construction capacity is struggling to keep up with demand. As a result, both contractor rates and wages are rising on a monthly basis.
“Production volume for the construction industry for March 2017 is 33% higher than a year ago, while it is up by 24.7% on last year’s low base for the first quarter of the year. By the end of March, the volume of building contracts for construction companies was up 50.2%,” reported Tibor Földi, CEO of Cordia Zrt, a Futureal Group company, commenting on the construction industry data published on Thursday by the CSO (the Hungarian Central Statistics Office).
Cordia’s experiences show consistently growing demand from buyers. This has in turn resulted in a rise in orders for the construction industry, with the capacity of contractors unable to keep pace. On one hand, this restricted capacity hinders the growth potential of the construction industry as a whole. On the other, it has resulted in monthly increases in contractor rates in keeping with the laws of supply and demand, and notable increases in the wages of workers. “This rise, which is also affected by the increase in the minimum wage, could slowly lead to a situation where Hungarian workers currently employed in the construction industry in Western Europe start returning home,” argued Tibor Földi.
The property expert also believes that recent CSO statistics for residential real estate construction in the first quarter confirm the legitimacy and usefulness of home-building initiatives. “We hope that these data and trends will help convince the government to keep the reduced 5% rate of VAT, which has played a key role in the growth in the market, beyond 2019,” said the Cordia CEO. He also added that “a permanent 5% VAT rate would also alleviate the problem of lack of capacity in the sector, as constructors would not need to rush to finish their developments by the end of 2019.”
Property developer the Futureal Group and Finnish communications and IT giant Nokia today opened the Nokia Skypark office building, according to a press release sent to the Budapest Business Journal. With the opening, one of Hungary’s largest IT and telecom R&D centers starts operation as the latest addition to Budapestʼs Corvin Promenade project.
Nokia Skypark, developed by the Futureal Group, boasts the latest technology since it is planned to meet the needs of technology and R&D. The office complex with an investment value of over EUR 70 million is entirely occupied by Nokia and more than 2,000 employees of the Nokia Networks Global Technology Center.
Based on innovative solutions, the building was designed by the internationally recognized, FIABCI audience award-winning Zoboki-Demeter & Associates Architects. With 25,000 square meters of gross leasable area (GLA), Nokia Skypark has a two-story lobby and a conference center on the first floor. Facilitating efficient, creative work enjoyed a high priority when planning the interior design, according to Futureal. On the ground floor, restaurants, cafés and a kindergarten provide additional comfort for Nokia’s employees.
Nokia Skypark has received BREEAM Very Good certification. Its environment-friendly solutions include automated shading technology, which can control the sunshine exposure as necessary, electric car charger, green roof, bicycle storage, dressing rooms and showers, as well as energy-efficient mechanical systems. A two-story underground car park and a separate parking area reserved for tenants provide space for more than 460 cars.
“Since the start of the financial crisis, Skypark has been one of the most significant rental transactions in the Hungarian office market. Corvin Promenade’s magnificent building has merged the highest level of architectural and IT knowledge that also contributes to the already existing scientific research work at Corvin Quarter,” said Gábor Futó, founder of Futureal Group.
“A revolution is taking place in the world: the 4th Industrial Revolution. And even in these moments there are a couple of revolutionaries working in the office building next to us,” said Béla Zagyva, managing director of Nokia Networks Hungary. “I am proud that we had the opportunity to create a worthy environment for our colleagues where they can focus on solving problems of the future.”
Futureal Group sold its Skypark office building to the OTP Prime Property Investment Fund in April. OTP Real Estate Investment Fund Management Ltd. launched OTP Prime in January this year, with the aim of investing in category “A” and “A+” real estate. The Skypark transaction increased the value of the fund’s property portfolio to over HUF 40 billion.
Corvin Promenade is an internationally recognized development project that has won the International Property Awards Best Mixed Use Development Europe award, as well as the property development award of the Hungarian Chapter of FIABCI. In 2014, the development was the first Hungarian project to be honored by the Urban Land Institute Global Awards for Excellence, considered the “Oscars” of the city and real estate development industry.
Futureal has sold its Sziget Center shopping mall in Hungary to OTP Property Investment Fund as part of the deal that also saw the purchase of the Skypark office building, according to a press statement sent to the Budapest Business Journal.
After a repositioning, the 23,600 sqm center located on the outskirts of Budapest has managed to attract high-profile tenants and tripled its lease income over the last two-and-a-half years, thus triggering interest from one of Hungary’s biggest property investment funds, Futureal says
The Sziget Center shopping mall is located in the heart of Csepel Island, on the outskirts of Budapest, next to the non-public Tököl airport. Its customer base is the more than 90,000 residents of the nearby settlements: Szigethalom; Szigetszentmiklós; Halásztelek; and Tököl.
The purchasing power of the area exceeds the Hungarian average and the domestic consumption of the residents are forecasted to rise in the coming years, according to Futureal. The accessibility of the area is excellent by car and public transport, and the suburban train line (HÉV) is only a few minutes away, the real estate firm adds. Sziget Center is currently the largest retail center on Csepel Island, and the appearance of any competition is deemed highly unlikely in the coming years.
Futureal purchased Sziget Center in 2014. In the last three years, the center has attracted several international tenants, increasing the leased area by more than 9,000 sqm. These newcomers include international clothing store operators C&A and H&M, the decor and furnishing chain Jysk; clothing and household goods network Pepco, household products and cosmetics distributor Euro Family and electronics retailer Euronics.
“In the past two and a half years, we have managed to perform a successful repositioning of Sziget Center by attracting the largest brands and thus tripling leasing income of the shopping mall,” said Gábor Futó, founder of Futureal Group. “The essence of this process was to strengthen the shopping center’s convenience offering, while creating a strong fashion supply. Thanks to the great infrastructure and location, the center is expected to bolster its supply with further international retail chains and increase its popularity among the residents of the area, becoming a truly dominant local center,” he added.
“The OTP Property Investment Fund has been of the most popular product of its kind in the last few years,” said Dr. Zsolt Barna, president and CEO of OTP Real Estate Investment Fund Management Ltd. “However, we had to adapt to the changing trends on the real estate market. For this reason we have begun a long-term project of developing our investment portfolio. As part of this process we have been looking to purchase high-end logistic and retail properties with high yield potentials. We are confident that our latest investment, Sziget Center fits this bill perfectly. However, this purchase is not the last step in the process, we are still looking for projects in Budapest and the surrounding areas,” Barna noted.
Nokia’s Skypark reflects the city’s changing designs
Tour operators would pay for the kind of panoramic vista of Budapest that Moric Toth has from his desk on the seventh floor of the Nokia Skypark office.
Mr Toth joined Nokia’s HR team soon after the Finnish IT company moved its Budapest operations, comprising more than 2,000 staff, into its gleaming new home of 25,000 square metres last January.
He was “amused and amazed” when he first saw the size and novel design of his new workplace. “I never thought there were so many working here. The building is big, very modern, and the working environment is top-notch,” he says. “It adds a lot to the good working experience.”
Along with health-food restaurants and a breakout space for Nokia’s software engineers to bounce ideas off one another, the building includes in-house doctors and psychologists, a nursery, massage parlour, sauna, showers and a spacious, well-equipped gym and aerobics facility. All this comes with an adjacent shopping centre, which is part of the same award-winning Corvin Promenade urban redevelopment.
Nokia Skypark exemplifies the renaissance of the Budapest office market following the financial crisis. The completion of the then substantial building programme led to a glut of space, vacancy rates above 25 per cent and a trickle of new developments in 2010-2014. The policies of the conservative populist Fidesz government, led by prime minister Viktor Orban, which took power in 2010, contributed to an uncertain business environment.
But with the global economic revival, along with a steady flow of new entrants and expansion of existing operations in Hungary, space has become tighter and the developers have gone back to work.
“The vacancy rate of [the most prestigious] office space in Budapest is now 8 per cent, a record low. We have a pipeline of five buildings totalling 37,000 sq m this year, with 16 buildings and a record 325,000 sq m expected in 2018,” says Kata Mazsaroff, head of occupier services in Hungary for Colliers, the property consultancy. “Budapest is definitely back on the map.”
As Nokia Skypark illustrates, the property upturn is not merely about quantity. In Budapest, where development is driven by outsourcing, the revival comes with an additional focus on the quality and suitability of office space. Tenants, agencies and developers are working closely on office design in order to attract and retain staff.
The recovery and the low vacancy rate has led to an increase in rents, with headline rates now at €13.50 per sq m, compared with €11.50 per sq m (including added incentives) in 2010. In response, investment has picked up, with office transactions worth about €940m in 2016, more than double the value in 2015, says Bence Vecsey, Budapest-based head of investment services at Colliers.
“Hungary’s attractiveness was reinforced by the upgrade to its sovereign debt rating by all three major credit rating agencies,” Mr Vecsey says, although the market was dominated by Hungarian open-ended real estate funds, which made 38 per cent of total purchases.
Despite prime yields falling to 6.5 per cent, most analysts expect the market to strengthen. The year got off to a good start, with Futureal, the developer of Nokia Skypark, initiating the sale of the building to OTP Real Estate Fund for an undisclosed price. Gabor Futo, founding owner of Futureal, called it a “milestone” deal.
It is not all straightforward, however. In a recent analysis, property consultancy CBRE warned that a shortage of construction workers — the adviser calculated numbers were 16 per cent down on 2007 — constituted the “single most important barrier” to completing planned developments, and had contributed to a 15-20 per cent rise in building costs last year through increased wages.
Budapest, 26 April 2017 – Futureal Group sold its Skypark office building to the OTP Prime Property Investment Fund. The recently closed transaction increased the value of the fund’s property portfolio to over HUF 40 billion. The complex, with 25,000 square meters of GLA, is located at the Corvin Promenade mixed use project in the center of Budapest and was designed to meet the needs of technology and R&D companies.
The construction of Skypark was finished by the end of 2016. Its 25,171 square meters of GLA is complemented by 226 square meters of storage space and a 460-car parking garage. The building is the first element of the eastern closing block of Corvin Promenade, its development started in 2015. Based on innovative solutions, Skypark was designed by the internationally recognised studio Zoboki-Demeter and Associates Architects, winners of the FIABCI audience award. The ground floor houses restaurants, cafés and a kindergarten, the building also includes a 2-storey lobby and a conference center on the first floor. The office complex is entirely occupied by one tenant. The acquisition of Skypark was one of the largest office market transactions over the last 12 months in Budapest.
OTP Real Estate Investment Fund Management Ltd., a leading player in the Hungarian property investment market has launched in January this year the OTP PRIME Property Investment Fund, which aims to invest in category „A” and „A+” real estate properties. The first acquisition of the new fund was the recent purchase of the Váci Greens “B” office building which is located on the Váci corridor. The new fund is primarily recommended for institutional investors and private-bank customers, so they can also profit from the positive trends in the property market.
The “A+” category Skypark achieved BREEAM Very Good certification. Its sustainability features include automated shading technology, which can control the sunshine exposure on demand, electric car charger, a green roof, bicycle parking racks, dressing rooms, showers and energy-efficient mechanical systems. Facilitating efficient, creative work had high priority, when planning the interior design. An urban space was designed in front of the entrance to the office building with a statue, fountain and seating surfaces, where 10-meter high plane trees have been planted. Around Skypark nearly 100 shops, restaurants, cafés, a fitness-wellness center, laundry, post office, bank branches and a cinema can be found.
“Skypark, as an iconic building of the Corvin Promenade further increases the attractiveness of Corvin Quarter for existing and potential tenants. When planning our office buildings our main focus is to create engaging and inspiring full-service environment in order to make attracting and retaining the best employees easier for our tenants. The innovative design and modern, environment-friendly solutions of the office building guarantee that the complex will be an excellent long term investment,” said Gábor Futó, founder of Futureal Group.
“Both the real-estate and the office market have been on the rise in the last year. We are of the view that this is the beginning of a strong real-estate market cycle. This is why we decided that the timing was right to create a new property investment fund, that focuses on investing into premium office developments such as Skypark,” said Dr. Zsolt Barna, president and CEO of OTP Real Estate Investment Fund Management Ltd.
Corvin Promenade is an internationally recognised and awarded development project that won the International Property Award Best Mixed Use Development Europe award as well as the property development award of the Hungarian Chapter of FIABCI. In 2014, this development was the first Hungarian one to receive the Urban Land Institute Global Awards for Excellence, which is considered to be the Oscars of city and real estate development industry.
About Futureal Group
Futureal is one of the leading real estate developers and investors in Central and Eastern Europe and is among the top 20 largest real estate developers in Europe. Over the last 12 years the Futureal Group has developed over 800,000 square meters of real estate projects with a total value of EUR 1.15 billion and is currently developing 39 new projects over 900,000 m2 with EUR 1.5 billion asset value.
About Corvin Promenade
One of the Futureal Group’s most outstanding projects is Corvin Promenade, the largest inner-city urban regeneration project in the CEE region. In 2010, the project received the European Commercial Property Award for the Best Mixed Use Development of Europe and in 2014, the company received the Urban Land Institute’s (ULI) Global Award for Excellence, considered to be the Oscars of city and real estate development.
Tenants of the new projects can employ 10,000 people in total in the capital
Futureal Group is extending its portfolio with a new office building. Located at the Váci office corridor, the Advance Tower is the second phase of the group’s ongoing project that involves the development of nearly 100 square meters of office space in the capital. The new office space, realized through the development project, will be three times bigger than all office developments carried out in Q1 2016 in Hungary.
Futureal Group launched the construction of Advance Tower’s first phase with a foundation stone laying ceremony. The 6-storey, ‘A’ category building, located in district 13, acquired a BREEAM certification indicating that it meets the highest sustainability requirements. Moreover, Advance Tower bears 11,900 square meters of gross leasable area (GLA) and will be realized through an investment that has a total value of EUR 36 million (HUF 11,2 billion).
The glass surfaces of the modern building, designed by Mérték Architectural Studio, grant the high proportion of natural light in the offices. According to the market needs, the office complex will be equipped with intelligent and sustainable technologies. Furthermore, as part of the intelligent building operation system, the automated shading technology, will facilitate the regulation of the sunshine exposure. By the same token, the office building will be hallmarked by decentralized hot water supply, smart irrigation system mounted on the roof garden as well as low-emission heating-cooling system.
“Futureal Group has developed over 600,000 square meters of real estate projects with a total value of EUR 900 million over the last 12 years. Reacting to the market needs, after the success of Vision Tower, our firm is launching several ambitious office projects in this year. The developments will extend the capital’s office market supply by roughly 100,000 square meters of gross leasable area enabling our tenants to employ even 10,000 people in total” – emphasized Gábor Futó, founder of Futureal Group. “As a result of the significant tenant interest towards the newly built Advance Tower, we have already started the planning of the second phase, containing 8,000 square meters of gross leasable area, through which the GLA of Advance Tower totals nearly 20,000 square meters” – he added.
Over 31,000 square meters of office space was developed during Q1 2016 in Budapest, representing a 56 percent growth compared to the previous year – revealed CBRE, a the commercial property and real estate services advisor. The office development volume itself, proposed by Futureal Group, is three times higher than the aforementioned result.
Besides Advance Tower, the company’s iconic office development project is Budapest One. The office park, having 70,000 square meters, will be realized in more phases in Őrmező, next to Etele square and Kelenföld railway station, where Hungary’s largest multi-modal transportation hub can be found. Travelers arriving from the west by train or car will be greeted by the office complex. The first phase of the office park will contain nearly 25,000 square meters of offices for rent as well as 2,600 square meters of commercial and service unit. Additionally, it will also provide significant green space and underground garage with 480 parking lots for the thousands of employees.
As part of Futureal’s portfolio, the fifth and sixth office building phase of the Corvin Promenade project will be launched soon. A 27,500 square meter office building will be located in the block locking Corvin Quarter from the east, in the immediate neighborhood of Nokia Tower, which has 25,000 square meters of gross leasable area. When planning the ‘A’ category office building’s concept, features that are extremely important for tech companies, for instance, higher electrical capacity and dual power supply providing continuous, uninterrupted operation, received special attention.
“Several new architectural values have been created over the last couple of years in the district. The district’s transformation has been in line with the endeavors of the city development. Preserving its ability of attracting capital, over 19,000 flats and nearly 1 million square meters of service-and office spaces were realized, and the Váci street office corridor became a real concept by now. The results obtained are also proven by architectural awards and a Hild Award. Private developments made in this council term exceed HUF 10 billion. Our passive house, which has been built as a municipal investment involving 100 flats, has been certified as world class on the international contest of FIABCI. The recent handover of our passive kindergarten located in Kassák Lajos street realized through our own resources that has a total value of HUF 1,3 billion, made us proud” – said Dr. József Tóth, mayor of district XIII.
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Futureal Group has successfully refinanced its Corvin Corner office building by signing a credit agreement with Erste Bank Hungary for €10.2m
Erste Bank increased its original €7m line of credit for the project as the occupancy rate of the Corvin Corner building, officially opened in December 2014, has already reached 100 percent. Corvin Corner is a building in the third office building phase of the Corvin Promenade project. Valued at €16m, the building offers over 6,000 m2 of leasable space. The category “A” office building, located on the corner of Futó and Práter streets in Budapest, Hungary, has received the BREEAM certification indicating the highest level of energy efficiency.
The largest tenant at Corvin Corner is EPAM. The company, one of the world’s leading software developers, rents over 5,000 m2 of office space. EPAM houses its Budapest operations in two office buildings at the Corvin Promenade, they have been a tenant at Corvin One since 2010. At the Corvin Promenade nearly 1,200 people are employed by the company.
“The credit agreement with Erste Bank demonstrates not only the success of our Corvin Corner project, but it also proves the stability of Futureal Group. In addition, it contributes to our efforts to focus on further office development projects” – said Gábor Futó, founder of Futureal Group.
“Erste Bank and Futureal Group have been close partners for 10 years. During the course of our cooperation, the bank participated in financing several successful office development projects which shows the Bank’s strong commitment to financial partnership and value creation” – said Zoltán Balázs, head of Real Estate and Structured Finance at Erste Bank.
FUTUREAL, one of the top 20 real estate developers in Europe will launch the first phase of the extension of Nova Park shopping centre, situated in Gorzów Wielkopolski, Poland. Around 10 000 additional squares metres of the leasable area will be delivered by 2020.
Through this two-phase project, the leasable retail area of NoVa Park will be increased to over 42 500 square metres. The first phase is scheduled to be completed in 2018 and delivered around 3 500 square metres. The opening of the second phase comprising an additional 6 500 square metres of GLA is planned to be in 2020.
Following the completion of the extension, the shopping centre will house many different shops and other services. Measured by floor area, the number of shops and the variety of the offering, this project will make NoVa Park the largest shopping centres in Lubuskie region. The extension and the existing shopping centre NoVa Park will be fully integrated.
Nova Park has received more than 16 million visitors since opening in 2012. Turnover grew by 12% in 2015 compared to the corresponding period in 2014. Following the project’s completion, it is expected that both NoVa Park’s annual footfall from the current figure of slightly under 5 million and sales at the shopping centre will increase as well.
Anna Malarczyk – Arcidiacono, Managing Director of the Polish commercial projects Futureal, commented: ‘NoVa Park is a vastly popular venue in a strong location. Its extension will allow us to bring new retailers and further enhance the shopping experience for all our clients. We know that there is a keen appetite among our customers for well-known and much-loved international brands”.
NoVa Park is a 32 500 square metres dominant covered regional shopping centre located in Gorzów, Poland. The Mall features 140 retailers offering a merchandise mix of retail, services, and restaurants.
Apsys Polska has been appointed by Futureal as the property manager for NoVa Park. The scope of works entrusted to Apsys includes: property management, retail space management, leasing agreements management and marketing.
Cordia Real Estate Development announces the development of 1500 newly built smart homes in 8 locations
Since the fall of communism, there has been hardly any development project of the scale announced today by the leaders of the real estate developer firm Cordia Hungary. The developers of Corvin Promenade are starting the development of about 1500 newly built apartments, most of which will be smart homes, in 8 different locations of Budapest. At the press conference, the firm also presented its real estate market report for Q1 2016. It shows that demand for newly built apartments has tripled in the inner city districts compared to the average of Budapest, therefore Cordia is focusing its new residential projects on these districts..
According to Cordia’s proprietary market survey, demand for new homes increased by 70% in the last six months compared to one year before and it was the triple of the demand two years ago. Cordia has responded partly to this phenomenon with its new real estate development projects. The significance of these 1500 new apartments is clearly demonstrated by the fact that during none of the past 4 years were more than 2000 new homes built in the capital city. In 2015, about 3500 newly built homes were sold in Budapest but this represented the whole supply as the supply of new apartments hit rock bottom by the end of the year.
Differences by district – up to 10-fold difference in supply
At the press conference, CEO of Hungary’s leading real estate developer Cordia Hungary Mr. Tibor Földi has also said that there are significant differences in the supply of residential property in different districts. Whereas supply is ample in the 3rd, 11th, 13th and 14th districts, there are parts of the city where there are only a few dozens of newly built homes for sale. The gap between supply and demand is the biggest in the inner city districts (5th, 6th, 7th, 8th, 9th districts) where demand exceeds supply three times i.e. only one out of three potential buyers can buy an apartment.
The market leader offers 1500 new apartments – The buzzword is „Smart Home”
In view of the above trends, Cordia has started a complex residential development project which consists of 8 sub-projects in 8 different locations of the city, building a total of 1500 new apartments in the forthcoming period. As a result, everybody will be able to find an apartment that fits their individual lifestyle and in their preferred location if they choose from the soon-to-be-available homes.
What is also special about this project is that Cordia’s newly built apartments will be so-called „smart homes”. With smart homes you can use your smartphone to access your home’s smart devices remotely e.g. from the city. It means that only with a push of a button you can check your heating or air-conditioning or whether you forgot to close the door.
Cordia will offer three different packages to their buyers representing three different service levels. The basic package will include lighting control and opening and closing the door whereas the premium package offers connectivity for virtually all web-enabled devices in the apartment: you can remotely control lighting, heating, electric sockets as well as the entrance security system.
The most recent development projects announced by Cordia will focus on districts where a significant gap has emerged between demand and supply in the past period.
8 locations in Budapest – 1500 new apartments
In the 8th district, Phase I of Corvin Atrium is part of the Corvin Project, one of the most prestigious projects in the city. Here, more than 260 apartments will be sold in a district where rental fees have doubled during the past 10 years. All this can be interesting especially for those who want to buy real estate for investment. In the 14th District, the Thermal Zugló II Project is very special because all the 190 apartments to be built there will be supplied with thermal water, not to mention the open-air bath across the street which is currently undergoing renovation and where an indoor swimming pool will also be built.
At the foot of the prestigious Rózsadomb, in Kapás Street, 2nd District, the 102-apartment Kapás21 project is also interesting because there has been no project offering newly built apartments in this area for years so Cordia expects tremendous interest. Cordia is launching two projects in the 13th district under which 410 new apartments will be offered to buyers. In the inner city districts, the Rózsa 55 project near Andrássy Street, and the Grandio project in a section of the 7th district called the “Budapest Soho” offer high-quality apartments to potential buyers.
Outlook on the real estate market of the capital
At the press conference, Cordia’s experts have said that since the number of empty plots is decreasing in the inner city, a significant shortage of new apartments may arise in these district and this may be one of the reasons, in addition to dwindling demand, why supply has shrunk lately. This is exactly why Cordia’s experts think it very likely that the price of the best situated inner city apartments might approximate the Western European price tags in just a few years.
The other reason why investors may remain interested in promising properties in the forthcoming years is that alternative investments offer very low yields currently primarily owing to the very low prime rate of the central bank. It is in response to these trends that Cordia is starting one of the biggest residential projects in the past 25 years in the spring of 2016. The 1500 apartments that will become available under this project will potentially satisfy most of the demand for real estate both for investment and for residential purposes.
This autumn, Futureal, one of the leading real estate developer and investor in CEE was rewarded three times. The company received the Project of the Year and the Transaction of the Year prizes at the Portfolio Property Awards. Futureal was also rewarded at the Hungarian Real Estate Development Award for Excellence for the development of Vision Towers.
Futureal, as one of the top 20 largest developers in Europe, received two significant awards on the leading industry event, the Property Investment Forum. Futureal’s Corvin Corner project was declared Project of the Year on the sixth Portfolio Property Awards. Readers of Portfolio chose the 5 most successful projects accomplished last year, and the participants of the conference voted for the winning projects. Futureal also got the Transaction Deal of The Year for the transaction with Hungarian branch of Nokia Networks. The office building in the Corvin Technology and Science Park will accommodate the offices and R&D center of the Finnish IT giant. The office building offering 25,000 sqm leasable space will be accomplished by the end of 2016.
The company was also awarded on the Hungarian Real Estate Development Award for Excellence, which was created by The Hungarian Real Estate Association, member of FIABCI, the International Real Estate Federation. Futureal rewarded by The National Federation of Hungarian Building Contractors, the Hungarian Green Building Council and Irodakereső.hu for the development of Vision Towers. This premium office product is located in one of the most popular business areas of Budapest. Owing to its unique architectural implementation, the ultramodern environment and its optimal location, the Vision Towers office complex became the first choice for major international companies as their headquarters in Hungary.
During the development of the buildings, Futureal placed great emphasis on the implementation of environmental, energy-saving and sustainability aspects. Most of the office buildings are certified by BREEAM System (Building Research Establishment Environmental Assessment Method), which is one of the world’s leading environmental certification system.
Raiffeisen finances the latest, 25,000 sqm GLA “built-to-suite” office development of major Central European real estate developer, Futureal. The fourth office building of Futureal’s flagship, full-service 500,000 sqm Corvin Promenade mixed use city quarter will accommodate the offices and R&D center of Nokia Networks the Finnish IT and Telecommunication giant.
Gábor Futó, founder and owner of Futureal, commented the transaction: “After the successful financing of KPMG headquarters on the Váci út corridor, our choice has once again been to work with Raiffeisen Bank. Raiffeisen appreciates the strengths of the project, the attractiveness of Corvin Promenade, the safety of the revenue provided by Nokia Networks and the experience and reputation of Futureal. Futureal is one of the very few developers in Europe, that can proudly say that we have always fulfilled all our promises, even in the deepest crises, to our banking partners, joint venture partners, tenants, customers and subcontractors. This reputation has paid off: as the real estate market has begun to revive, we have enjoyed the confidence of banks and tenants alike that are choosing us for the development of their built-to-suit headquarter projects. Our Corvin Promenade urban regeneration project, with its excellent central location and full range of services has once again proved itself as the ideal project to help companies attract and retain the best minds.”
Ferenc Kementzey, deputy CEO of Raiffeisen Bank, said: “Raiffeisen intends to remain a dominant actor of the Hungarian banking sector, and finance only the best real estate projects. An important part of our success is that our project financing unit decides professionally and carefully on lending issues. Futureal has a reliable banking partner behind its operations, while for the bank, it was important to have a partnership with one of the largest developers in the region.”
The project started in January 2015 and its completion is expected in the last quarter of 2016. A restaurant and a day care facility for children will also be located in the building, furthermore a gym will serve the comfort of Nokia employees as well.
In order to improve the public safety of Corvin Promenade, the BRFK Police Office of District VIII. has opened a new trustee office supported by Futureal. By opening the new office, the company and the police would like to increase the comfort and convenience of Corvin Promenade’s thousands of residents and employees. Dr. Péter Futó, co-founder of Futureal explained at the event: as a responsible property developer the main goal of their cooperation is not just building high quality properties but to further improve the livability of this special district.
On the 11th of November, at Nagytemplom Street, the new trustee office, which was established due to the co-operation of BRFK Police Office of VIII. district and Futureal has solemnly passed. Dr. Máté Kocsis, Mayor of the VIII. district, Gábor Molnár, Lieutenant Colonel of police, police captain of Józsefváros, Dr. Péter Futó, founder and co-owner of Futureal and Tibor Tatár, CEO delivered a speech at the event. Furthermore Gábor Bucsek, brigadier general of police, police chief of Budapest and Dr. Imre Vas, member of parliament attended the event too.
Dr. Máté Kocsis, mayor of Józsefváros said: “This is a special occasion today, because we can see a fine example that there are entrepreneurs like the founders of Corvin Promenade, who, beside the usual common public charges, selflessly participates in the realizations of aims which can make our life better. The establishment of the new trustee office is a similar objective, by taking over the expenses, the investors of the Promenade provided a significant support for the police and the residents. I am convinced that the police presence can increase the residents’ subjective sense of security. I would like to say special thanks to Dr. Péter Futó for the significant offer, and to the police that they were open to the initiative, so from today the citizens can turn to the district trustee. I am confident that this is only the first step and there can be similar successful cooperation like this in further areas, for example in Palotanegyed.”
In one of the most successful urban development projects from the last few years, thanks to the total infrastructural, architectural and environmental transformation, which took place in the area of the Corvin Promenade, the promenade provides home for thousands of people and offers exclusive working environment for several companies. Futureal, besides offering high-quality real estate to its clients, it considers the sense of security and comfort of residents and employees important.
Dr. Péter Futó, founder and co-owner of Futureal said: “The concept of the project was to be a city in the city from the beginnings and now it’s became true. We are proud of the already built 50.000 square meters of offices and 2.000 apartments, and the 25.000 square meters of offices and 1.000 apartments under construction. In addition, building 40.000 square meters of business area is also an integral part of the project. The fact that this is a liveable and special part of Budapest, is not only recognized by residents and employees day-by-day: a number of international organizations – for example the American Real Estate Association – already awarded our development. Of course, all this would not be possible without our successful cooperation with the local government, and I hope it will also help us in the future to do our job and continue building the promenade.”
Ten years ago, according to a survey conducted by Futureal among 500 participants, before the development of Corvin Promenade 80-90% of the respondents refused to live in the 8th district. Few years ago, the company carried out exactly the same research. That time, 70% of the respondents said that they were willing to live in the district, furthermore, more than 90% of the respondents found the area of the promenade attractive. Tibor Tatár, CEO of Futureal stated: “The area went through a great change, including public safety, but it always can be improved. That is why we offered 5 million forints for the construction of the office, and we took over the rental and running expenses for 3 years, in a similar amount. At the time of the realization of Corvin Project, Futureal built several things for the benefit of the public: we have built roads, renovated the underpass of Üllői Street, built a gymnasium for Práter Street School, financed the installation of MOL Bubi public bicycle system, established community gardens, and today’s police office also fits perfectly into this line. We are aspiring to participate in investments and projects serving public benefit and the sense of comfort of those who live here.”
One of the Largest Office Leasings in Recent Years: Nokia Moving to Corvin Promenade
The Hungarian branch of Nokia Networks are moving to Corvin Promenade. The building works of the 25,000 sqm headquarter started at the beginning of 2015 and the office block will close the Eastern end of the large-scale Corvin Promenade City Regeneration Project.
“Following a year-long tender process the Nokia Networks selected the Corvin Promenade to home their new headquarter. The office building offering 25,000 sqm leasable space, developed by the Futureal Group, will be accomplished by the end of 2016 and will also contain a hypermodern research laboratory. The building was planned by Zoboki-Demeter and Associated Architects, awarded with FIABCI’s Prix d’Excellence in 2006. Since the crisis this has been one of the largest office lease deals on the Hungarian market”, mentioned Gábor Futó, Founder and Co-owner of the Futureal Group.
Nokia Networks is one of the world’s largest telecommunication companies and the market leader in developing and planning broadband mobile networks, including 4G network. The new headquarter will home Nokia Networks Global Technological Centre, becoming one of the largest IT and Telecommunication R&D centres in Hungary.
Béla Zagyva, General Manager of Nokia Networks, Hungary said, “When we decided to look for a new headquarter for our Hungarian office due to the increasing workforce and the changing needs, we also decided to provide the best possible working conditions by having an office built to satisfy the long term needs of our company. The new office building being built on Corvin Promenade will provide the most state-of-the-art work environment available for our research/development work, and will offer excellent transport infrastructure and service environment for our highly qualified staff.”
Dr Péter Futó, Founder and Co-owner of the Futureal Group stressed, “The building fulfils special technological expectations even among the A-category office buildings with its outstandingly high electric capacity, double feeder, the ergonomic lift system equipped with destination control and BREEAM certificate. Apart from the underground garage, parking will be facilitated with a parking house built for Nokia, while the restaurants will be located on the ground level of the building.”
The new building will provide not only workplaces for those working in it, but the open space on the ground level will also provide public access for the pedestrians, completely integrating the office building into the city texture. Parallelly with the new office complex, which will close the Promenade, the new parked section of the walkway will also be built based on the plans of Anikó Andor, landscape architect. This way the 800 metre long pedestrian walkway, which appeared first on the drawing board 15 years ago to connect József Boulvard and Szigony Street, will be created.
The Corvin Promenade is CEE’s largest urban development project, where 50,000 sqm office is planned with underground parking spaces for 800 cars, 1,100 residential units with 600 parking spaces, 40,000 sqm retail with the belonging 800 parking spaces and 3,000 sqm fitness facility have been built. The Futureal Group commenced the project in 2004, the completion is expected by 2018-2020. On the planning works of the project 30 Hungarian and foreign architects have worked so far.
In autumn 2014 Corvin Promenade was the first in Hungary to be recognized with the Urban Land Institute’s ‘Global Award for Excellence’, considered as the Oscar Award for urban and property development. The Washington based Urban Land Institute, established in 1936, is a global nonprofit education and research institute with 32,000 members. Its mission is to provide leadership in the responsible use of land and in creating and sustaining thriving communities worldwide, representing all aspects of land use and development disciplines. The 11-strong jury of the Institute recognized the best achievements with the ULI Global Awards for Excellence for the 36th time last year. In selecting the winning projects, in addition to considering responsible land use, the evaluation criteria included the quality of architecture, the impact of the project on the environment, how the developers cooperated with local organizations to meet the local community’s and other social needs, and what alternative financing methods were applied.
Futureal is the First Private Sector Company to Fund its Own Bicycle Rental Station
Budapest’s bicycle sharing network MOL BUBI just received a welcome new addition in the heart of Corvin Promenade. This is the first docking station realized entirely with private capital, funded by the company responsible for the complete renewal of this area of the 8th District, Futureal Group.
This summer the public bike-sharing system of Budapest is expanding with 22 brand new docking stations, 616 docking points and 50 bikes. In this round of expansion, a new station was set up on Corvin Promenade – uniquely funded entirely with private capital, by Futureal Group – across the street from the Futó Street entrance of Corvin Plaza, right before the bakery store. This MOL BUBI station was also equipped with a terminal that allows occasional users to register and buy a ticket. The new docking station is expected to facilitate getting around easily and in an environment-friendly manner for those who live here and work here – around 8000 people altogether – and for visiting tourists alike.
Mr. János BERKI, Project Director at Futureal explained: “During the implementation of Corvin Promenade, creating a sustainable and livable residential and office environment was always a priority. As early as the offices’ planning stage we paid great attention to the development of bike storage solutions and the creation of a bicycle-friendly environment, and in all office buildings designed by Futureal we make sure that bicycle parking units and the adjacent locker and shower rooms are environmentally friendly. Another major feature of all our office developments is their accessibility by bicycle, which we have always focused on and will certainly keep doing so. Installing a station here for the bicycle sharing network – which is run successfully in many European cities and is quite popular here in Budapest as well – reflects the same mindset.” He also added: “Based on the latest data by the Hungarian Cyclists’ Club, over the past twenty years the number of cyclists in Budapest has grown eleven times, which is another reason we find it important to support sustainable means of transportation. In agreement with the goals of MOL and the BKK, leading the way among private sector companies we were the first to fund our own BUBI station.”
Since 2004, in the framework of the largest urban development project in East-Central Europe, this nearly 22 hectare area in the 8th District has undergone a complete infrastructural, architectural and environmental transformation, for which it became the very first Hungarian project to be awarded with the urban and real estate development sector’s most highly valued recognition, the Urban Land Institute’s ‘Global Award for Excellence’. Even the synopsis of the award points out how this project has created a healthy, low-carbon, human scale urban environment. U.S. news channel CNN has also turned its attention towards the award-winning Corvin Promenade, and in the recently aired footage they called it “one of the trendiest areas of the city”.
The world’s leading news channel has turned its attention to Corvin Promenade – the first Hungarian project to win the urban and real estate development sector’s most highly recognized award, the Urban Land Institute’s ‘Global Award for Excellence’. The report aired on June 1st, 2015, at 5 p.m. CET.
The complete report can be viewed at the following link: https://www.youtube.com/watch?v=wIlB4xWcfPM
U.S. news channel CNN was on site in Budapest shooting about Corvin Promenade on April 30th and May 2nd. The 3-minute-long coverage highlighted the urban rehabilitation aspect of the award-winning project, and it carried the good name of the Hungarian development straight into the homes of 370 million viewers. The story featured architect György RÉVÉSZ (member of the Board of RÉV8 Zrt., and deputy head of the Department of Urban Planning and Design at the Budapest University of Technology and Economics), who originated the idea behind the project, and Futureal’s Chief Architect Gábor RADVÁNYI.
The 36-meter-wide and 350-meter-long Corvin Promenade covers 22 hectares in the heart of Budapest. This part of the 8th District has undergone a complete infrastructural, architectural and environmental renewal. The 100% Hungarian-owned Futureal Group and the District’s local government carried out an exemplary collaboration all throughout the project, which resulted in the establishment of first-rate residential and office buildings, commercial, service, and sports facilities. There have been no changes of similar magnitude in Budapest’s internal districts since Andrássy út was completed back in 1896. The 15-year-long project, underpinned by innovative urban planning and the most up-to-date real estate development solutions, resulted in a vibrant, livable, sustainable urban area with 4000 people living and more than 4000 working here.
Futureal was awarded the Urban Land Institute’s ‘Global Award for Excellence’ in the autumn of 2014, as the very first Hungarian project to win this prestigious award. The Urban Land Institute is an international non-profit organization based in Washington, established in 1936, listing 32 000 members. Its mission is to uphold responsible land use and real estate development, and to help bond a strong international professional community. Last year the organization’s 11 jury members awarded the best of the best with the Global Awards for Excellence for the 36th time. When judging the award-winning projects, they focused on several key aspects, such as responsible land use, the architectural quality of the completed development, its environmental impact, and the cooperation between the local organizations. In 2014, alongside Budapest’s Corvin Promenade, winners included projects such as the Governor George Deukmejian Courthouse rehabilitation in California, an environmentally friendly public building realized as a PPP project; the Sixty London commercial office complex in London, which incorporates one of the area’s historic stone gatehouses; and the Tjuvholmen buildings in Oslo, which are part of the Fjord City urban renewal project. The full list of 2014 winners is available on the ULI website (in English) .
After KPMG, Teva Hungary Zrt., Provident Financial Zrt., and Costa Coffee have all chosen the iconic Vision Towers office building. Having in a first stage purchased the Northern Tower of the building complex developed by Futureal on 23 500 square meters, Erste Real Estate Fund went on to buy the Southern Tower as well.
Owing to its unique architectural implementation, the ultramodern environment, and its optimal location, the Vision Towers office complex – which stands on the site of the former Hotel Volga – now operates with nearly full occupancy. During the development of the building in one of Budapest’s most sought-after business districts, on the corner of Váci út and Dózsa György út, Futureal placed great emphasis not only on the iconic architectural features, but also on the sustainability of the class ‘A’ office building constructed in the second phase, thus acquiring the ‘excellent’ rating of the BREEAM certification system.
In addition to its outstanding location and unique appearance, the energy-saving building engineering solutions, the most advanced IT network available on the market, and the intelligent building control systems of Vision Towers have all contributed to making Futureal’s latest office building the first choice for major international companies as their headquarters in Budapest. “The Hungarian real estate market remains on a path of dynamic growth, which is underscored by the fact that shortly after its completion Vision Towers already operates with nearly full occupancy. International Audit and Consultancy company KPMG, multinational pharmaceutical company TEVA, international financial company Provident, as well as Costa Coffee have already honored us with their confidence and chosen the building we dreamed up as their home. The thriving cooperation with the district’s local government is also an enormous pleasure for us, their support has contributed greatly to the successful implementation of this project” – said Gabor Futo, Futureal’s Founder and Co-owner.
“It goes to show the district’s competitiveness and capability to attract capital that one-third of the city’s investments are now concentrated in our district. As many as 200 000 square meters of commercial and service units were inaugurated between 2010 and 2014, and – with the acceptance of the district’s development program ‘Lendületben a XIII. kerület’ – we expect this progress to continue” – dr. József Tóth, Mayor of Budapest’s 13th district pointed out.
Balázs Pázmány, Chairman of the Board of Erste Asset Management Zrt. said the fact that the new wing of the Vision Towers office building was nearly fully leased played a prominent role in this transaction. Owing to the concluded long-term lease agreements with well-known, reliable tenants, the purchase of the new wing contributes to the favorable utilization of the assets of Erste Real Estate Fund, ensuring an appropriate return on the investment for their clients. The current net asset value of the Erste Real Estate Fund exceeds HUF 241 billion. The Erste Asset Management mainly invests the assets of the Fund in office and commercial purpose real estates and the property purchased so far accounts for nearly 45% of its portfolio. Regarding the other liquid assets of the Erste Real Estate Fund, the primary aim is to ensure sufficient liquidity while achieving the best possible return, so the Fund places its assets which are not yet invested in real estate on the interbank market and in government bonds with a maturity within a year.