Budapest Business Journal 2614

HUNGARY’S PRACTICAL BUSINESS BI-WEEKLY SINCE 1992 | WWW.BBJ.HU

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BUSINESS JOURNAL BUDAPEST

VOL. 26. NUMBER 14

JULY 13 – JULY 26, 2018

SPECIAL REPORT Tourism SPECIAL REPORT

Rising Tourist Visits Attracting Hotel Developers

As tourism to Hungary and Budapest continues to rise, developers and hotel operators see the potential for more hotel development.  12

SPECIAL REPORT

Ambitiously Building on Record Tourism Figures Registered guest nights in the capital were up 8% last year, topping a record ten million.

In Hungary, guest nights show a 70% rise since 2009.

Such numbers are attracting domestic and global interest. 16

SOCIALITE

Swimming in and Around Budapest Your idea of heaven may be swimming laps in an unheated outdoor pool at the crack of dawn. Or it might be lounging at the lido on a gloriously hot Hungarian afternoon. Or it might just be ‘wild swimming’.  22

Selling the Spice of Hungary NEWS

Making Bilateral Relationship ‘Best Ever’

America’s new Ambassador to Budapest has vowed to work with the Hungarian foreign minister to make the bilateral connection “the best relationship that it has ever, ever been”.  4

SP

LR EC I A

EPOR

T

Head of the Hungarian Tourism Agency (MTÜ) Zoltán Guller discusses the “Spice of Europe” marketing campaign, follow up plans and future trends in the country’s booming tourism market. 18

BUSINESS

GTC Delivers White House Project

GTC Hungary has officially opened its new Budapest office development, the 21,500 sqm GTC White House in the Váci corridor, after a two-year construction period.  6

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THE EDITOR SAYS

EDITOR-IN-CHIEF: Robin Marshall EDITORIAL STAFF: Zsófia Czifra, Kester Eddy, Bence Gaál,

David Holzer, Christian Keszthelyi, Gary J. Morrell, Rob Smyth, Zsófia Végh, Ágnes Vinkovits.

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When I first arrived in this country, tourism seemed to be an area largely ignored by the governments of the time, with very little spent on promotions advertising the country. At some point in the early noughties, tourism was memorably described to me by the then commercial director of one of the five-star hotels as an unwanted orphan, shunted from one government department to another, going through endless changes in personnel. I was even told that the annual winter campaign to attract more tourists was initially the brainchild of the hotels themselves, based on a buy three nights, get a fourth free model. Things have certainly changed.

As you will see in our Special Report, tourism currently contributes 10% of GDP but the government target is to raise that to 16%. Now we have high production value mini-movies promoting Hungary as the “Spice of Europe”, and regular slots on CNN. Even the Prime Minister’s daughter, Ráhel Orbán is taking a deep interest in the sector.

You might argue over how the money is spent, whether it is being targeted as well as it could be, but the quality of the output is good and the level of ambition striking. No one can reasonably claim that tourism is an unloved orphan now, or that the government isn’t paying the sector due attention.

Except, perhaps, in one area.

Think of tourism in a Budapest context and images of tourist-thronged public squares spring to mind, crowds on foot trying to take in the striking architecture while avoiding other groups mounted on scooters with outsize balloon wheels or on Segways. Hotels benefit from leisure tourists, of course, but they also benefit from what is known in the trade as MICE tourism: meetings, incentives, conferences, and exhibitions.

Hungary does increasingly well from this field, too, but hoteliers I have spoken to have long called for a modern, high tech, purpose built national conference and convention center in the center of Budapest, capable of taking 5,000 people; indeed, it has been a topic of conversation since I first arrived here in 1998. It always seems to be just around the corner, though that is becoming a very long bend by now. There are options, especially the Budapest Congress Center, next to the four-star Novotel Budapest City hotel in Buda, but it is the biggest such facility, and has a capacity of 2,000.

Several years ago an exasperated hotel general manager, who has since moved on to another posting, told me he did not understand why the government did not simply go ahead and start building.

“A large scale congress center will bring far more money into the country than another renovated football stadium,” he told me.

It seems he, and everyone else, will have to wait longer still. The government had said it intended to build a conference center and had even allocated HUF 4.3 billion in funding in the 2018 budget, but this June, a regrouping of funds related to the project appeared in Magyar Közlöny, the official gazette.

Those funds will now go to the “Kemény Ferenc Sports Facilities Development” program, and to prepare other developments in South Pest and North Csepel. A further funding of HUF 50 mln has been added to the sports project to finance advisers, appraisers, and legal representatives.

Yet again, sport trumps MICE. Robin Marshall Editor-in-chief

Photo: MTI/Noémi Bruzák

Photo: fortepan.hu/Péter Karabélyos

The Budapest Business Journal, HU ISSN 1216-7304, is published bi-weekly on Friday, registration No. 0109069462. It is distributed by HungaroPress.

Reproduction or use without permission of editorial or graphic content in any manner is prohibited. ©2017 BUSINESS MEDIA SERVICES LLC with all rights reserved.

TOURISM NO LONGER UNLOVED OR UNWANTED. MOSTLY

THEN & NOW

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Kids carelessly enjoy the summer heat at a swimming camp at Paskál Thermal Bath and Lido, in Budapest’s District XIV, on June 29. In the black and white photo, people chill on the banks of Lake Balaton in 1912.

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News

///macroscope

Weak Forint, Sluggish Industrial Performance Only Temporary

Hungary’s industry barely expanded in May, while the June consumer price index exceeded the central bank’s mid-term goal of 3%. In the meantime, the Hungarian currency has experienced all-time exchange rates high against the euro in the past few days.

The evolution of inflation in Hungary, January 1991-June 2018 change compared to the same period of the previous year,%

Source: KSH/MTVA Sajtóadatbank/MTI

ZSÓFIA CZIFRA

Hungary’s industrial output rose 0.4% yearon-year in May, the Central Statistical Office (KSH) said in a first reading of data on Friday. If adjusted for the number of working days – of which there was one more in the base period –, output climbed 3.8%. The weaker data comes after a strong few months: In April, output rose by 7.8% according to unadjusted data, and by 2.9% according to adjusted data. In a month-onmonth comparison, output in May was up a seasonally and working day-adjusted 1.9%.

For the January-May period, output rose 3.1% year-on-year.

The low output growth comes from a higher base, Miklós Paczari, a KSH department head said in a comment reacting to the data.

But there is no need to worry: analysts unanimously say that the weakening of the industrial performance is only temporary.

Industrial output growth could become stronger again in the coming months on the installation of new production capacities and the favorable outlook.

The government has also argued that the economic output does not explain the depreciation of the forint.

“We do not exclude that speculative processes are behind this,” said government spokesman Zoltán Kovács, without giving details, index.hu reported. That is a view the central bank has openly disagreed with.

Péter Virovácz of ING Bank noted that the month-on-month output growth has seen the strongest increase this year.

He emphasized that if segments with a

relatively low contribution to the GDP can maintain their currently strong growth rate and the automotive industry can shift into a higher gear, then industry will not be a drag on a full-year GDP growth of

more than

4%.

Such a positive scenario is further strengthened by the fact that German industry has finally produced better figures.

According to Erste Bank analyst Orsolya Nyest, the May performance of industry was actually a positive surprise, taking the 3.8% working-day adjusted annual growth rate into consideration.

She added that the latest data shows how uneven the performance of industry is.

She, however, does not expect the positive trend to change, although she also does not rule out the possibility of a lower-thanexpected growth rate for the full year.

The KSH has also published its consumer price index for last month.

Figures show that annual inflation was 3.1% in June 2018, a 0.3 percentage-point increase on the previous month.

Core inflation stood unchanged

Stronger Performance

András Horváth of TakarékBank also predicts stronger performance for industry in the coming months, noting that the low base of the second half of the last year can also add to the growth, in addition to the new capacities. Due to the strong domestic demand, domestic sales within industry has an ever growing role, and this tendency is supported by the recent boom in the construction sector, he added.

According to the analyst, working dayadjusted industrial output growth could accelerate to 6.5% this year, from 5.6% in 2017, and unadjusted growth to 6%, from 4.8% in 2017. TakarékBank therefore predicts GDP growth of 4.6% for the full year, and with some upward risks, this figure can even be higher.

at

2.4%,

while core inflation adjusted for the effects of indirect taxes was up 0.1 of a percentage point to 2.3%.

The swing is only temporary here, too, as according to the projection in the MNB’s June “Inflation Report”, inflation has temporarily risen slightly above 3% driven by the sharp increase in oil prices.

Nevertheless, it added, the 3% inflation target will be achieved in a sustainable manner by mid-2019.

Passing Phase

Analysts questioned by state news agency MTI also see it a passing phase. Péter Virovácz of ING Bank said inflation could rise higher than 3% over the summer, and the weakening of the forint and higher oil prices pose a risk. However, inflation could still average 2.8% for the entire year, he added.

Gergely Suppan of TakarékBank said inflation could be around 2.7% for the full year. Inflation could fluctuate around 3% next year and average 2.8% for the year as a whole, he added.

K&H Bank chief analyst Dávid Németh noted how fuels and tobacco products had pushed inflation higher in June, adding that without these products inflation would have been unchanged from the 2.8% rate recorded in May. He predicted that CPI could stay above 3% for the remainder of the year and even reach 3.3-3.4% by December, but concurred that it should still average 2.8% for the year as a whole.

The KSH has also published its consumer price index for last month. Figures show that annual inflation was 3.1% in June 2018, a 0.3 percentage-point increase on the previous month. Core inflation stood unchanged at 2.4%, while core inflation adjusted for the effects of indirect taxes was up 0.1 of a percentage point to 2.3%.

In the meantime, the Hungarian currency has been depreciated to record lows recently, even hitting the 330 mark against the euro. Analysts and the government agree that there are no macroeconomic reasons for the weakening forint, as the fundamentals of the Hungarian economy are stable.

At the end of June, National Bank of Hungary (MNB) governor György Matolcsy was summoned to appear before the Parliamentary Budget Committee on July 4 in order to provide an explanation for the depreciation of the currency. In a response issued by the MNB, it said it is only the Parliamentary Economic Committee that, under the law, has the right to hear the governor of the MNB, and therefore Matolcsy did not show up before the committee.

As reported by MTI, the MNB claimed in its statement that László Varjú, chairman of the Budget Committee and an MP of the opposition DK party, had initiated the hearing “without knowing the central bank act, solely for political gain, while the central bank act clearly states that the primary goal of the MNB is reaching and maintaining price stability.”

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Renaissance: Making Bilateral Relationship ‘Best Ever’ The minister was equally upbeat, telling the ambassador: “It is not an exaggeration to say that what is coming up is a renaissance of our bilateral relationship. And the political pillar of this relationship now will catch up with the economic and security perspectives of our cooperation so far. We are ready, Your Excellency, to work together with you to create the best ever U.S.Hungarian bilateral relationship.”

Szijjártó said Hungary understood how important this day was. “Just like you Americans, we Hungarians are real

America’s new Ambassador to Budapest has vowed to work with the Hungarian foreign minister to make bilateral relations between the two countries “the best relationship that it has ever, ever been”.

“It doesn’t matter if you’re rich or poor, if you’re white, brown, black. It doesn’t matter if you are a firstyear immigrant into our country or if you’re a fourth generation. This is a day that we celebrate our freedom and it’s very, very important.”

ROBIN MARSHALL

Ambassador David B. Cornstein was speaking at the U.S. Embassy’s official Independence Day Celebration, held at the Ambassador’s Residence in Buda’s leafy District XII on July 3, an event he referred to as “our little birthday party”, though it drew in around 1,000 guests.

As he had done at his Senate Committee on Foreign Relations hearing, the ambassador highlighted the importance of freedoms he said America holds dear.

“This is a very, very important day for every American,” he told the assembled guests on the lawn of the residence. “It doesn’t matter if you’re rich or poor, if you’re white, brown, black. It doesn’t matter if you are a first-year immigrant into our country or if you’re a fourth generation. This is a day that we celebrate our freedom and it’s very, very important.

The rule of law that we have, the freedom of the press, the freedom of religion, the freedom of speech. This is all so, so important to us.”

And those were more than just words, Cornstein insisted. “I come from the business world, and a lot of times we say that words are fine, but actions really prove something. And I believe that in this brief 242 years that we’ve had, we’ve shown through action how important

U. S. Ambassador David B. Cornstein (left) and Minister of Foreign Affairs and Trade Péter Szijjártó. these freedoms are to us. We fought a Civil War for the freedom of all rights of men to be free and not to be slaves. We fought in World War I, World War II, the Korean War, and too many wars in the Middle East just to show how important democracy is to us.”

Just ten days into his post, he told guests “I can’t thank all of you for being here enough; it means a great deal to me,” adding, “I can promise you one thing, and that is one year from today we’ll know all of you a lot better than we know you today.”

He also singled out for praise David Kostelancik, who acted as charge d’affairs while the embassy was left without an ambassador.

Watching the Store

“It was his birthday yesterday and I told him how much I really didn’t like him,” the ambassador joked. “The reason I don’t like Dave Kostelancik is that everybody I’ve met just thinks so much of him, and I thank you, Dave, for the work you did in watching the store here for the past year and a half, and doing a wonderful, wonderful job.”

Cornstein then introduced Minister of Foreign Affairs and Trade Péter Szijjártó as: “Somebody that I know that we are going to work together to make this relationship the best relationship that it has ever, ever been, and I think we’re off to a wonderful start.”

freedom fighters as well.” Hungary felt “solidarity” with all those who have to fight for their freedom.

“Hungary will never join the U.S.bashing chorus in Europe, which sometimes, it seems to me, is becoming a kind of political hobby,” he said. “We will always respect the decision of the American people: we will never judge and never comment on that.”

The foreign minister said the two countries also shared a belief that nations had a sovereign right to decide who could enter their territory.

“Your President called my Prime Minister just very recently. And I will always remember one sentence – of course all of the sentences of him – but one sentence for sure, when he said ‘Keep the borders strong’. That was the President’s advice to my Prime Minister.”

Other shared beliefs include peace keeping and protection of the JudeoChristian heritage, the minister said.

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Do you know someone on the move? /// Send information to news@bbj.hu

Baker & McKenzie Budapest Gets new Principal

Ákos Fehérváry took over as principal of Baker & McKenzie Budapest on July 1, leading the office’s M&A and Private Equity practices as co-head of the group, and continuing to manage the office’s employment and employee compensation practice group, according to a press release sent to the Budapest Business Journal.

The new principal is a lawyer with two decades of experience in advising on M&A and corporate transactions, including foreign direct investment (from privatizations to private equity and greenfield), corporate group reorganizations, high-profile share and asset transactions, and multijurisdictional cross-border deals.

Fehérváry has worked on transactions in a number of industries, including automotive, banking, energy, food, high-tech, IT, and transportation, with some of his deals considered landmark on the Hungarian and CEE markets.

He gives employment-related advice to multinational companies as head of the employment practice group. He also acts as a co-head of the China Service Group, giving legal support to Chinese clients, while also co-managing the pro bono activity of Baker & McKenzie’s Budapest office.

Deloitte Hungary Appoints German Auditor to Lead German Desk Professional services firm Deloitte Hungary has appointed German national Manfred Siebke as director and head of the company’s German Desk.

Deloitte says it is planning to enhance its role in advisory services for Austrian, German, and Swiss companies through the appointment. The firm notes that companies from those three countries hold investments of more than EUR 32 billion in Hungary.

Siebke joined Deloitte Hungary in April, having previously held a leadership position in the finance department of a French pharmaceutical company. He also has several years of experience as a Big Four auditor in Düsseldorf and Prague.

The newly appointed director is a member of the German Chamber of Auditors and Chamber of Tax Advisors.

“As an investor or manager, there is a wide range of challenges in business which might need external support,” said Siebke. “For example, accounting topics such as the option to prepare local financial statements according to IFRS, new tax-related obligations such as real-time VAT reporting, but also operational issues such as the ongoing need to drive efficiency.”

He added: “As one of the leading professional firms, we do have answers to those challenges. Our objective at the German Desk is to provide 360-degree solutions as a single point of contact; a trusted advisor who is able to consider our clients’ needs and accompany them through the whole process.”

According to the press release, Germany is the biggest direct investor in Hungary, with EUR 20.1 bln of net investment, representing 26.7% of total

also announced appointments to other management positions in the company.

Benedek has more than a decade experience in financing telecom companies. He worked previously as head of company financing at GTS Central Europe and later as operative and financial director at Deutsche Telekom, where he supported the integration of the GTS group.

Invitech has also appointed Imre Ökrös as director for network development, Mátyás Dobó as deputy director for strategic and business support and Tibor Kaczur as director for marketing and communication.

it to other CEE countries and beyond.

Impact Advisory will offer legal and nonlegal support in a number of areas, advice on investments and reorganizations in Hungary, and services related to global business service, shared service centers and project management.

The venture’s CEO will be Balázs Tüske, who has more than two decades of consulting experience as an advisory services leader and transaction support leader at EY Hungary, and also at audit and special projects at Arthur Andersen in Australia. Tüske will focus chiefly on buy and sell-side due diligence, mergers and acquisitions, and large transformational projects.

“The combination of our advisory team with the broad network and market-leading innovation of Dentons creates a unique product offering for our clients,” said Tüske. “Not only are our clients increasingly looking for advisers who can provide full-scope advisory services on transactions and shared services, from planning through to execution and integration, but they also want their advisors to add value through innovation and new market approaches,” he added.

Dentons Links up with Former Big Four Consultants Law firm Dentons has announced it is joining up with former Big Four consultants in Hungary to launch Impact Advisory, a joint venture able to offer

foreign investment in the country.

Austria represents 9.9% of the total, with Switzerland representing 6.4%.

“In comparison to the environment in Germany, Austria and Switzerland, there are still sizeable advantages in respect of labor costs, taxation and potential subsidies, but management and owners also need to be aware of the risks, like frequent changes in regulations, and an increasing shortage of qualified workforce,” stressed Siebke.

Invitech Names Financial Director IT and telecom solutions provider Invitech has appointed Norbert Benedek (pictured) as financial director. Invitech

consulting services that extend beyond the law firm’s legal services.

The JV is being piloted in Hungary, with the long-term goal of expanding

Also in the team is Arjen Sader, (above) another former EY partner. Coming from both an operational and consulting background, Sader is well-known in the global SSC, GBS, and business process outsourcing markets, the press release says. Several other experienced consultants will join the venture as well.

“Our clients’ needs are becoming increasingly complex, as they face challenges and opportunities due to globalization, technology, competition, and the constant pressure to do more for less. Often their needs go beyond traditional legal services,” explained Dentons Hungary Managing Partner István Réczicza.

“As part of our vision to always be the law firm of the future, Dentons is continuously challenging the status quo, and the services offered by this talented team of consultants will complement both our core legal services and our Nextlaw offering,” added Tomasz Dąbrowski, CEO of Dentons Europe.

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Business

GTC Delivers White House Project GTC Hungary has officially opened its new Budapest office development, the 21,500 sqm GTC White House in the Váci corridor, after a two-year construction period.

portfolio to

140,000 sqm.

GARY J. MORRELL

Developed on the site of the 100-yearold former Schleck Elevator Factory, the building has been refurbished and provides 2,000 sqm of redeveloped office space in addition to 19,500 sqm of new offices.

The LEED “Gold” pre-certified project was designed by Zoltán Tima of Közti architect studio and the general contractor on the project was Swietelsky.

“We are focused on office and shopping centers,” says Thomas Kurzmann, CEO of GTC. “With regard to the office asset class, one of the main recruitment drivers for international companies in CEE where there is full employment and a shortage of skilled labor is the quality of office they provide. We therefore help our tenants create an environment where staff are happy to come every

District XIII. The company has received a building permit for the Twist - Budapest City Tower, a 37,000 sqm, 23-level tower, with construction scheduled to commence by summer. This will be the tallest office center in the area, according to GTC. In the other project GTC is planning to deliver is the 29,000 sqm Pillar, construction of which is due to start in Q3.

With delivery of White House, GTC has extended its Budapest office

GTC White House. day and there are pleasant places to eat and relax. On top of this, one of the biggest drivers is energy costs efficiency and therefore we have provided high recovery ratios for heat energy at White House in winter and cooling systems in summer. White House is very important for our group because we have integrated the environmental system in the new modern building and the heritage part of the project.

It took us a long time to get the right system implemented,” Kurzmann explains.

A significant letting has been concluded with BlackRock and the asset manager will take occupancy in July for use as its innovation and technology center. According to on-going negotiations, the remaining space could be

100% occupied

by the third-quarter of the year, GTC says.

As is the norm across its portfolio, GTC has a 60% loan-to-value ratio on the White House project.

The complex is the latest completion on the Váci Corridor; it has direct access to two metro stations and a tram line, and provides parking spaces for 300 vehicles, electric car charging and bike racks with changing facilities.

Speculative Projects

GTC has two further ongoing speculative Budapest office projects, both located in

The CEE-based company has a policy of maintaining its developments within its own portfolio on a long-term basis and actively manages 42 buildings, providing 700,000 sqm of lettable office and retail space in Belgrade, Bucharest, Budapest, Poland, Sofia and Zagreb.

“GTC has developments of more than 450,000 sqm in six countries and a further pipeline of 400,000 sqm at the planning and permitting stages. Regarding our portfolio, we did a major clean up and divested some of our assets in 2014-2016 and this is the reason we are not now selling, as what we have we like a lot and all the assets have potential for rental growth,” Kurzmann says.

“This is a strong standing portfolio that brings in income and will have a gross asset value of EUR 2 billion by the end of the year. This allows us to be patient, and we had to be patient with White House because we have already owned the land for several years and we had the time to design, think about what we wanted to do and execute the project. It is important for us to sustain a crisis in the future and have the strength to keep our developments,” he adds.

Wing to Develop evosoft Hungary Headquarters “We are a trusted partner for leading Wing is developing a new 22,000 sqm Budapest multinational companies in Hungary headquarters for evosoft Hungary, 100% owned seeking long-term property solutions, as evidenced by our completed and ongoing

by Siemens, in order to consolidate its activities HQ developments and references. The new evosoft office continues this trend as a world into one location. The site is located adjacent to class workplace which will be a new landmark the Ericsson research and design headquarters at on the Buda river bank,” Steinberg adds. the Nobel Prize Winners Research & Development Support Co-working The 20,400 sqm LEED “Gold” pre-certified Park, on the Buda side of the Rákóczi híd. building will provide 520 underground GARY J. MORRELL

Wing has become a niche developer of built-to-suit high tech office headquarters in recent years while the south Buda area has become the high-tech hub of Budapest.

“The office building of evosoft will be developed by Wing and handed over to evosoft in the form of a longterm lease agreement as the second phase of the Hungarian NobelPrize Winners’ R&D Park,” says Noah Steinberg, chairman and CEO of WING, of the project.

parking spaces. The complex, penned

by Aspectus Architect, Wing’s in-house design studio, is planned to support co-working for the circa

1,500 staff

at evosoft. The building, located in the vicinity of the Budapest University of

Technology and Economics and the Faculty of Informatics of Eötvös Loránd University will allow software developers to work in a conducive environment, according to evosoft.

JLL, tenant representatives for evosoft, provided a number of options and the project was chosen based on design and location.

“Industry 4.0 is now a reality based on software. We are keen on constructing the best working place for brilliant minds where they can be productive and creative at the same time, allowing us and Siemens to be a key player of the fourth industrial revolution,” commented István Petényi, CEO of evosoft Hungary.

Construction works has started already, and the new HQ is scheduled to be delivered in January 2021; at the time of writing, a general contractor was yet to be announced.

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Company ///news 5 Hungarian Companies win Innovation Grants From European Union

Five Hungarian companies have been picked for funding under the European Union’s Horizon 2020 research and innovation program, the European Commission said on June 28, Hungarian news agency MTI reported. The companies are among 242 SMEs from 30 countries selected to get a total of EUR 12 million in funding from a scheme dubbed the SME Instrument. The five are: Bio Blocks, which provides medicinal chemistry services and products to help pharmaceutical customers accelerate drug discovery programs; Newity, which has developed an automated home brewery; Nutripharma Hungaria, which is working on immunobiotics for treating early stage Age-related Macular Degeneration (AMD); Organochem, which is developing an integrated approach for environmentally benign carbon-carbon coupling reactions; and Medika, which is commercializing a dental medical device for measuring salivary pH. The winners will each get EUR 50,000. The SME Instrument is targeted at businesses “with a radical innovation that can disrupt established value networks and markets”.

Private Placement of BILK Shares Fails BILK Logisztikai Nyrt. said on July 6 that it had closed the private placement of its shares without selling them, and it had also withdrawn the public offering of the shares, tozsdeforum.hu reported. BILK explained the decision by saying that the “optimal investor structure which could be in coherence with the “SZIT” [real estate investment trust, or REIT] requirements was not established at a sufficient price.”

The CEO of BILK, Lívia Waberer said in a statement that investors became cautious because of sudden changes in the forint’s exchange rate and because they do not have sufficient knowledge about the advantages of operating as a REIT. BILK Logisztikai owns one of the biggest logistics parks in Budapest. BILK planned to apply for a licence to operate as a REIT after the successful public offering of the shares, Waberer had said on June 20 when she announced the launch of the process. REITs must pay shareholders 90% of profits as dividend. Waberer said at the time that BILK aimed to sell between 25% and 49% of the company’s share capital. The share offering could have been affected by the recent sharp weakening of the forint as it, as well as dividend payment, was to take place

in euros. György Waberer, BILK’s founder and main shareholder, had said that a 5% discount was offered from the price of the public offering to investors subscribing to a maximum of 550 shares.

Doosan to Build Tatabánya Copper Foil Plant South Korea’s Doosan announced on July 1 that it will build a new plant in Tatabányai Industrial Park (60 km west of Budapest) where 50,000 tons of copper foil will be produced annually from the second half of 2019, portfolio.hu reported. The copper foil is required for the production of batteries for electric cars. The construction will start this year and the plant is scheduled to be completed in the second half of 2019, the company said. The 50,000 tons of foil per year is sufficient for the production of 2.2 million batteries for electric cars. The spokesperson for Doosan said that it could become the sole supplier of copper foil in Europe. SNE Research said that demand for copper foil is expected to grow dynamically in the next decade. On July 2, state news wire MTI cited South Korean news agency Yonhap as saying that Doosan will start building the plant in December. The plant will create 200 jobs, it said.

NÉBIH: Greenyard ‘not at Fault’ in Listeria Infection The Hungarian Food Safety Office (NÉBIH) said that frozen food company Greenyard Frozen Hungary Kft., based in Baja (195 km south of Budapest) was not at fault in respect of the Listeria monocytogenes infection in its

Business

|7

bags of frozen vegetables, hvg.hu reported.

The strain of listeria that had caused the death of nine people in Europe was detected in frozen vegetables produced by the Hungarian company in 2016, 2017 and 2018, bbc.com said. The bacteria occurs on raw vegetables and it is natural for them to enter processing plants. The Baja plant knew it had the bacteria in the plant, but it should not have been present in the processing sections.

The European Food Safety Authority said this week that this version of the bacteria was so strong that it could not have been eliminated by normal cleaning and disinfection.

Currently, Greenyard is cleaning the plant, after which it will be able to produce listeriafree products. Nébih stressed that all frozen food has to be heated in accordance with the recommendations on the packaging, not served uncooked. On July 6, EFSA said there had been 47 cases of poisoning reported, including nine deaths. The countries affected were Austria, Denmark, Finland, Sweden, and the United Kingdom.

ALDI Installs Solar Farm by Store ALDI Magyarország Élelmiszer Bt. has installed its first solar farm next to its store in Sopron (214 km west of Budapest) in order to reduce CO2 emissions deriving from its operation, profitline.hu reported. The subsidiaries of ALDI group undertook to reduce greenhouse gas emissions by 30% by 2020 compared to 2012. ALDI Magyarország is the first retail chain in Hungary to have switched to green energy. The Sopron solar farm is expected to generate enough energy for 2-3 months for the store.

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01/09/17 18:07

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Budapest Business Journal | July 13 – July 26, 2018

Future driven innovation

sponsored by

Innovations see Hankook Tires Rolling Toward a Safer Future

a year. Original Equipment tires for many premium automobile manufacturers like Audi, BMW, Mercedes-Benz and Porsche are produced in the Hungarian plant.

One of the latest tire technologies developed by Hankook Tires, called the SEALGUARD®, is applied locally in Hungary.

“The sealing material in these self-sealing tires repairs punctures on the tire tread, so drivers can continue their journey safely.

As a result of that, vehicles equipped with these advanced tires shall no longer carry any spares, which frees up extra space and also eliminates the requirement to change tires on the side of the road,” Hankook Tires tells the BBJ in a statement.

Hankook Tire sees innovation as essential to fulfilling R&D Everywhere the customers’ needs for safe, comfortable and The company notes that R&D is more than ever in all activities, and that enjoyable journey. Development must be constant, ispresent equally true of Hankook as well.

“Environment, technologies and work accompanied by technological innovations, in order methods are continuously changing. to meet the expectations dictated by a market Nothing better proves Hankook’s commitment to innovation than the prone to rapid change and customer needs, the new Technodome opened in Daejeon, South Korea in 2016, which acts as a company tells the Budapest Business Journal. core instrument of the company’s global CHRISTIAN KESZTHELYI

“This is why we continuously work on achieving our goals by supporting and inspiring our employees – which is indispensable for applying innovations that are leading to a market leader position,” says Hwang Seong Hak, managing director of Hankook’s production facility in Rácalmás, 75 km south of Budapest.

Hankook Tire employs more than 22,000 employees around the world and is present in more than 180 countries. The company maintains five R&D centers and eight production facilities, with tires for the European market made at Rácalmás.

The factory says it launched production here in 2007; today, Hankook Tire Hungary employs around 3,000 people and capacity has increased to 19 million tires

association with the prestigious Royal College of Art in London. Students majoring in vehicle design are required to present a 3D model of a future tire, including tire, wheel, and exterior design.

At the IAA 2017 show in Frankfurt, Hankook showcased innovative concept tires inspired by future mobility. The five futuristic concept tires Magfloat, Flexup, i-Play, Shiftrac and Autobine were all designed by students of the University of Cincinnati, USA. Magfloat is for flexible single user mobility based on magnetic field extensions; Flexup is for single user mobility that can freely ascend stairs; and i-Play targets two-wheel single user mobility. The Shiftrac allows for strong cornering, whilst the Autobine can attach and detach tires from the body as required according to the number of passengers.

This regular column, run in association with Audi, looks at how some of Hungary’s biggest companies involve innovation in their daily practice.

R&D infrastructure. The high-tech facility provides an optimized research environment, helping Hankook experts to focus on technology for the future with well-known quality,” the company explains.

Hankook inspires ideas that can reshape the future, such as its Innovation Design Project, in which design schools all around the world are invited to come up with concepts for cutting-edge technology.

This year, the project is being held in

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KEEPING AN EYE ON THE JOB

Six tips to keep your eyes happy in the office Dryness is one of the most common eye complaints, especially among those working at a computer for long hours.

You must pay extra attention and protect the eye surface to prevent further problems. Let us show you how.

1 Change focus What tires your eyes more than anything is staring intently at the screen. Immersed in a demanding task, we actually forget to blink and our eyes don’t get enough lubrication.

A short but useful exercise can take care of this: look out the window every so often and focus in the distance for a few seconds, then back to a close object. Do it back and forth a few times. And don’t forget to blink while at it!

2 Take a break The bare minimum during an eighthour shift on the computer is three 15-minute breaks when you get away from the screen.

3 Not so bright It is more gentle on your eyes to work in subdued ambient light. Avoid bright neon light and shelter your screen from the sun too. Adjust the position and brightness of your computer screen if needed so that it doesn’t glare and beam too bright. It should feel comfortable to look at the screen without feeling overwhelmed by the light.

Remember the rule of thumb: the higher the contrast (e.g. black on white) and more naturally legible the text, the less your eyes and brain will work to make sense of what’s on the screen. Bear in mind, though, that too large a font calls for more dynamic scanning with your eyes and scrolling with the mouse, which is just as bad. Just find that sweet spot that works for you.

5 Clean display A smudgy screen makes it harder to focus and decreases contrast. Clean it regularly.

6 Keep distance Keep an optimum distance of 50-75 cm between your eyes and the screen. It is best to keep your focus of your gaze slightly below eye level, so adjust your display accordingly. Tilting your head up or down too much may fatigue your neck. If you work with long texts regularly, opt for typewriter scrolling in your text editor or desktop application, which keeps the active line at the same level on your screen.

4 Increase font Set your type font and zoom at a reasonable rate so as not to overexert your eyes deciphering the text.

www.drrose.hu

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Budapest Business Journal | July 13 – July 26, 2018

Business | 9

LIN E M O T T O B E TH

Tourism Profits Should not Come at Cost to Residents Francisco Santos, a 32-year old Portuguese architect, a resident of Lisbon, was in Budapest earlier this month. Originally from Viseu, a provincial Portuguese city, he met up with a group of former school friends for a three-day, 15-strong stag party.

KESTER EDDY

This involved some heavy drinking, especially on the final, Saturday night, in Budapest’s District VII party quarter.

“We finished about six this morning.

We’d rented a house as a group, but I got a hotel room for last night. I woke up at 11:30. I feel a lot older than 32 right now,” he admitted to me on the plane to Lisbon.

Santos – who coincidentally designs hotels in his day-job – not only denied causing any public disturbance, he denied seeing any.

“There was no real trouble. Yes, there were some Brits that were [taunting] my friend, because he’d dressed up in pink.

And at the Széchenyi Baths, there were some groups, very noisy,” he said, noting Brits were the main perpetrators.

Santos estimated he’d spent EUR 300 on his stay, not counting accommodation (at EUR 15 per person per night, that would total EUR 675 for the duration). And assuming a similar daytime spend by all, the group’s input to Hungarian economy would come to EUR 5,250 - not counting ancillary income like his Wizz Air tickets and airport landing fees.

That’s good business for Hungary and especially for the District VII hospitality industry.

Comes with a Cost

But as revealed in the story on Page 17, not all visitors to Budapest’s party district behave as well as Santos and friends.

This niche – but thriving – tourism segment comes with a direct, physical cost in terms of vandalism and damage to the property of local residents.

But this is probably negligible compared to the more intangible costs borne by the same residents in terms of disturbed sleep, anger and frustration both with the outlandish behavior of some visitors and the seeming unwillingness by the authorities to stop it.

The lack of police presence and action, against both the very real, excessive bingeing and open drug dealing in the

heart of Budapest is in stark contrast to the squads of well-armed, burly cops and soldiers regularly depicted by TV news broadcasts on the country’s borders, supposedly acting against what is, today, a largely non-existent horde of illegal immigrants.

The disturbances are spreading: as residents from housing blocks surrounding the party district increasingly rent out their properties via Airbnb to visitors, their unfortunate, former neighbors are equally increasingly woken up by returning revelers incapable of locating their accommodation. The corridors of such blocks are also increasingly found awash with vomit and urine in the morning. (Diplomatic sources suggest Brits are the worst offenders.)

Dóra Garai, a leading campaigner for the protection of ordinary residents in District VII, warns that frustration is rising, and it can only be a matter of time before clashes – mostly so far limited to egg throwing and cold water tossed from upper-story flats – between locals and unruly visitors result in serious injuries.

En route to Lisbon, Santos judged the trip good value. “Of course it was worthwhile, we grew up together as kids,” he said. “Now we are all spread out, in London, Zurich, around Portugal; we don’t see each other very often.”

But for Budapest’s party district to be worthwhile for all in Hungary – and truly sustainable – local residents need a better deal, and the authorities must find a way to act to facilitate that.

The Bottom Line is a monthly column written by Kester Eddy, a long-standing and well respected Budapest-based business and economic journalist, who has written for the Financial Times and many regional publications. The opinions expressed in the column are not necessarily those of the Budapest BusinessJournal.

To comment on this column, or on anything else in the BBJ, email the editor at robin.marshall@bbj.hu

2nd district

2nd district

2nd district

89 sqm – 2 rooms + hall, Káplár street

98 sqm – 3 rooms, Nyúl street

76 sqm – 2 rooms, bUdaKeszi street

This very bright, street and garden facing apartment benefits of a balcony and it is situated within a building in good condition with elevator, close to the Millenáris Park.

In a very green and quiet street, in a nice villa house, this sunny apartment has separate rooms and beautiful panorama over the Buda Hills.

In a new subdivision with common wellness area, this very bright apartment has beautiful panorama, separate rooms, fully fitted kitchen, 20 sqm of terrace, private garden and garage.

59.500.000 hUF

71.900.000 hUF

78.000.000 hUF

+36.1.336.1706

+36.1.336.1706

+36.70.376.4138

2nd district

2nd district

2nd district

130 sqm – 5 rooms, Karabély street

270 sqm – 2 rooms, töröKvész slope

500 sqm – 6 rooms, GyöNGyvér street

This very sunny and quiet apartment has panoramic view, terrace, private garden, garage and 2 parking spaces in the courtyard.

Beautiful panorama over the Buda Hills, this 3 storey semi-detached house, that needs renovation, has 2 balconies, terrace, private garden and a two car garage.

Next to the forest, this new, two storey, luxury family house has 77 sqm of terrace, 100 sqm of wellness area, 4 car garage and well kept garden.

115.000.000 hUF

126.000.000 hUF

+36.1.336.1706

3rd district

+36.70.376.4138

3rd district

219.000.000 hUF

+36.70.376.4138

3rd district

66 sqm – 3 rooms, raKtár street

73 sqm – 3 rooms, sUlyoK street

130 sqm – 4 rooms, szeNteNdrei street

Panoramic view over the Buda Hills, this sunny, high floor apartment benefits of separate rooms and balcony. It is situated within a building with elevator, in a quiet street.

This spacious, very well divided, quiet, park facing apartment in good condition benefits of a wardrobe room and balcony. It is situated within a well maintained building.

This very well divided, spacious, duplex apartment has separate rooms, 2 bathrooms, terrace, private garden and garage. It is situated within a nice villa house.

31.400.000 hUF

39.900.000 hUF

44.900.000 hUF

+36.1.430.1403

3rd district

+36.70.669.5350

3rd district

+36.70.669.5350

6th district

100 sqm – 3 rooms, zápor street

180 sqm – 5 rooms, temesvári street

129 sqm – 3 rooms, városliGeti alley

This spacious detached house, that needs renovation, built on 287 sqm of lot, has separate rooms, 2 bathrooms and terrace. It is located in a quiet street.

Close to the Danube, in a beautiful, green street, this very spacious, two storey detached house built on 640 sqm of lot, has two bathrooms, terrace, nice garden and garage.

This completely renovated, spacious apartment has 2 entrances, 2 bathrooms, balcony and it is situated within a very nice, renovated period building with well kept common garden.

89.900.000 hUF

180.000.000 hUF

135.000.000 hUF

+36.1.430.1403

6th district

+36.70.669.5350

9th district

+36.1.351.0446

13th district

villa hoUse – 1350 sqm, beNczúr street

78 sqm – 3 rooms, FereNc circUit

53 sqm – 2 rooms, tUtaj street

This completely renovated, 5 storey villa house benefits of terraces, balconies and a very nice, well kept garden. It is located close to the Andrássy Boulevard.

In a renovated period building with glass elevator, this completely renovated apartment has living room with fully fitted open kitchen, 2 separate bedrooms and 2 bathrooms.

In a very nice, Bauhaus style building with elevator, this very sunny, street and garden facing apartment in good condition benefits of separate rooms and balcony.

1.350.000.000 hUF

74.900.000 hUF

32.900.000 hUF

+36.1.351.0446

13th district

+36.1.351.0446

13th district

+36.70.414.7759

For rent

73 sqm – 3 rooms, balzac street

92 sqm – 3 rooms, pozsoNyi street

102 sqm – 4 rooms, KecsKe laNe

This completely renovated, quiet, high floor apartment has separate rooms and big balcony. It is situated within a Bauhaus style condominium with elevator.

Nice panorama over the Danube, this very bright, spacious, well divided, high floor apartment is situated within a Bauhaus style building with elevator.

56.900.000 hUF

91.900.000 hUF

3rd distr.: This completely renovated, furnished, street facing apartment has separate rooms, 2 bathrooms, private gas heating and balcony.

+36.70.414.7759

+36.70.414.7759

350.000 hUF/month

+36.1.430.1403

GrUppo t.F.m. KFt. 1068 bUdapest, Király U. 102. each agency independently owned and operated. • these offers are valid, till the apartments are sold. • these information do not constitute a contractual element.

3

www.bbj.hu

Budapest Business Journal | July 13 – July 26, 2018

Focus

Customer Experience

Technology Investments Leading Growth of Online Customer Experience, but People are Still King The increasing importance of “customer experience” is undoubtable nowadays as customers are becoming more connected, and influence each other to a greater extent, while they appear to be more fickle and willing to drop a brand for a better looking one. The Budapest Business Journal discusses the impact of CX with experts from DEVELOR International and EY Hungary.

CHRISTIAN KESZTHELYI

In today’s world, when so much information is at our fingertips and communication has never been more rapid, the expectations of customers related to how services should treat them and what experiences they should have when using those services have been rising ever higher.

“The trend is solid and stable. As customers are highly connected – and year by year more so –, they influence each other far more than traditional marketing. Customer Experience is ‘the’ marketing today,” Zsolt Pozvai, Global CEO at DEVELOR International, tells the BBJ. Simply repackaging former efforts won’t keep customers happy and loyal; rather a completely new mindset is needed in the most involved industries, such as banking, insurance, telecom, hospitality and retail, he says.

In this tight-knit and fast-paced race to keep clients, companies need to be extra alert, as customers will now more easily abandon brands in favor of better looking ones.

“It’s clear that consumers around the world are increasingly fickle,” Ákos Demeter, partner at EY Hungary, says.

“They are more willing than ever to drop their brands of choice in favor of something different. This change is challenging companies to evolve to the point where globally

only

5%

media are in the lead, while retail, banking and energy sectors are lagging behind.

“Right now, the focus is on end-to-end digital channels, and assisted sales is going to be the next wave,” Demeter says.

Lately, companies in Hungary have been heavily investing in technology in order to

68% of cases.

of retailers think their customers remain loyal, according to our latest survey,” he adds.

CX Differentiates

Businesses do seem to recognize this trend and the need to address the matter. Pozvai notes that, according to DEVELOR’s annual customer experience survey, recently 80% of Hungarian companies claimed they wanted to be the industry leaders of customer experience and this is one of the top three priorities in the strategy of 86%.

“We might state that the C-suite has realized the importance of the topic, and on strategic level they act upon it. The real differentiator is what extent they are able to implement it in the daily operation of the front-office, when clients meet the representatives of an organization. Here we observe huge gaps, which proves that the devil is in the execution: the problem is not in the strategy and concepts but on the level of actions. Many companies don’t walk the talk,” Pozvai insists.

Demeter also notes that an increasing number of large corporations nowadays take customer experience as a primary tool for their future differentiation.

“However many companies are at a very early stage of implementation. Over the last two years, there has been a significant acceleration in this process,” Demeter underlines. He adds that the focus on customer experience is more visible in fields performing online activities. In terms of sectors, telecommunications and

function in the physical world, rather use mass targeting and customer service. In fact, customer experience based – even personalized – customer service has gained attention over the last two years,” Demeter adds.

Pozvai also stresses this angle: “In the last several years, huge investments have been made in the technology, improving the multi-channel servicing, the mobile services, chatbots were implemented,” he says, tagging such as important steps.

However he notes that “it would be high time to return to those who can make real connection to customers: the people.”

With the advent of a new era focusing on a customer first approach, executives have started realizing that even if customer intimacy and customer centeredness is obvious in their corporate culture and is acknowledged by their employees, still the employees’ behavior and attitude can be insufficient to reach high levels of customer experience. According to Develor’s national survey, customers regularly meet salespeople and customer service staff who are literally not engaged to their employer, an experience that negatively influences the customers’ opinion about both the company and service in

Zsolt Pozvai improve in the field and become better able to offer an improved customer experience.

Two-speed Hungary

“In Hungary, such efforts work at two different speeds. Companies that primarily operate online use advanced technology to improve customer experience, even to an extent where they monitor their customers, collect and analyze data then make personalized offers in order to improve their customer experience,” Demeter notes.

“Meanwhile, companies that primarily

“People engage with people. Employee engagement has become the crucial factor in customer loyalty. This is a hot topic for many companies worldwide, just as in Hungary. The majority of companies regularly measure the engagement, and then make actions; still the general engagement level has been shrinking for a while,” Pozvai says. He adds that employee satisfaction does not equal employee engagement, and this is a significant difference that many decision makers and HR executive do not understand or fail to realize.

“The new relax room, the gym and the foosball table will influence satisfaction, just like a salary increase, but not engagement. The major engagement drivers are autonomy, the feeling of progress and personal growth, the connection to others,” Pozvai pinpoints the differences. He believes that employees have to feel that their work has a greater purpose than the work itself.

“The management’s responsibility is creating an engaging environment where people feel passionate and committed toward the work. So, if we want to make customers loyal, we should start with the employees. Based on my experience there is still a lot to do on this field, from training managers how to engage staff to internal projects to boost the factors on organizational level,” Pozvai notes.

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www.bbj.hu

Budapest Business Journal | July 13 – July 26, 2018

Photo by Attila Bálint

Special Report Tourism

Rising Tourist Visits Attracting Hotel Developers  12 Hungary Ambitiously Building on Record Tourism Figures  16 Light and Dark: French Film Maker Documents Party District  17 Creating a Vision and a Plan for a Four Season Hungary  18

Hungary, and Budapest in particular, is attracting record numbers of tourists. Here’s how.

12 | 4

Special Report

www.bbj.hu

Budapest Business Journal | July 13 – July 26, 2018

Rising Tourist Visits Attracting Hotel Developers As tourist visits to Hungary and Budapest continue to rise, developers and hotel operators see the potential for more hotel development.

GARY J. MORRELL

In 2017, an estimated 11.8 million tourists visited Hungary, the highest figure on record according to CBRE. Budapest accounted for 36% of arrivals, representing around 4.3 million tourists and hotel occupancy rates for Budapest rose to 78.8%.

In addition to tourism, the other significant growth area is an increase in the number of business travelers. CBRE has traced a pipeline of 18 three-to-fivestar hotels under construction in Hungary, a clear majority of these in Budapest, with a further 13 in the planning stage.

Hospitality consultancy Horwath HTL sees opportunities for hotel development in Budapest. With regard to supply of hotel rooms in comparison with, for example, Prague and Vienna, there are no concerns about possible oversupply. However, despite the current boom in the Hungarian and Budapest hotel market, the labor shortage is acting as a brake on both hotel development and tourism industry growth, according to the consultancy.

The latest extension of the Budapest Ferenc Liszt International Airport is due to be completed this summer and will increase its capacity to

15

million

passenger arrivals.

In a niche hotel development, Wing has opened the first hotel at the airport.

Aria, a classical boutique hotel in the historic city center.

The 145-room ibis Styles Budapest Airport Hotel is seen a landmark building that will raise the profile of the airport. Wing has invested HUF 3.2 billion (more than EUR 10 million) in the project, financed by the Hungarian state-owned EXIM bank.

The bank has the aim of developing the tourism sector in the 60-140-room hotel range.

Historic Center

In the next significant delivery at the top end of the Budapest hotel market, the Hungary-based, Jordanianowned hospitality developer Mellow Mood is due to complete the 110-guest room and suite Parisi Udvar Hotel in the historic center of Budapest by the end of the year. The complex has been designed by Archikon and a franchise agreement has been reached with Hyatt Unbound Collection. The Párizsi udvar

(as it is known in Hungarian) building dates back to 1931.

The project has been under development for several years, reflecting the difficulties associated with the redevelopment of a listed building in the heritage protected center of town.

However the large number of historic buildings in key central locations provide the opportunity for their redevelopment as boutique hotels and with rising construction costs this can be a more economic development option in central areas of the city, where there is limited provision of plots.

In another redevelopment of a historical building, the five-star W Hotel Budapest on Andrássy út by QPR Properties (part of Constellation Holdings) has been at the planning stage for several years, and is now scheduled to deliver

160 rooms

by 2022. The project will represent the launch of W Hotels Worldwide by Marriott in Hungary.

In another high-end pipeline project due for delivery this year, Accent Hotel Management is constructing the 210-room Hilton Garden Inn Budapest in District VI. The Egyptian-owned Zenobia Hungary is also due to deliver the 150-room, fivestar Zenobia Palace Hotel in District VIII this year. Matild Palace, under reconstruction by the Turkish Özyer Group, is scheduled to deliver a 130room Marriott The Luxury Collection branded hotel in 2020.

In the medium-level of the market, Bedori Investment is due to deliver 184, three-star rooms at the 7,500 sqm Meininger Hotel Budapest in Csarnok tér, next to the Great Market Hall in the third quarter of the year.

The hotel will be operated by Meininger Hotels based on a 20 year lease.

Key Locations

ibis Styles Budapest Airport Hotel.

Germany’s Deutsche Hospitality, in conjunction with the B&L Group has

acquired construction permits for the 310-room, 16,000 sqm InterCity Hotel Budapest, its first CEE InterCity Hotel, at the Keleti Railway Station. The company has the policy of developing the brand at what it sees as key train stations and airport locations, and the Budapest project is scheduled to be completed in 2020.

Outside of the capital, in Nyíregyháza (230 km east of Budapest), the 9,000 sqm Hotel Sóstó Spa & Resort is due to deliver 122 four-star rooms in the fall.

In Gyöngyös (78 km northeast of Budapest), the Avar Hotel by Aranypart 2000 Kft. will deliver 98 rooms at around the same time.

As with other property development sectors, market growth is being hindered by a shortage of skilled labor and rising construction costs.

“Due to capacity shortages and price increase in the construction sector, many of the new projects shifted their delivery date. Several major luxury hotel chains are planning to enter the Hungarian market in the coming years,” commented CBRE. The company has traced as many seven pipeline projects with 150-plus rooms on the Pest side of Budapest.

The positive trends in the tourism industry are attracting investors: EUR 140 million in hotel investment

“Due to capacity shortages and price increase in the construction sector, many of the new projects shifted their delivery date. Several major luxury hotel chains are planning to enter the Hungarian market in the coming years.” transactions were concluded last year.

The five-star hotel sector in Budapest in particular is attracting the interest of international investors, as this hotel market segment has occupancy rates of around 78%, Starwood Capital acquired the Sofitel Budapest Chain Bridge Hotel from Orbis Hotel Group for EUR 75 million. Budapest is regarded as part of a Central European “golden triangle”, along with Prague and Vienna, from a hotel investment perspective by many hotel investment analysts.

However, that EUR 140 mln still represented only a

marginal

8%

share of the overall commercial property investment transactions for Hungary and is well below the long-term potential for the market sector in the view of CBRE. The hotel sector is generally regarded as higher risk than, for example, the office and retail sectors, and therefore has the resulting higher yields.

4

www.bbj.hu

Budapest Business Journal | July 13 – July 26, 2018

INSIDE VIEW

Space tourism – New market emerges in space

According to research by SchengenVisaInfo.com, most applications at Hungarian consulates for shortstay Schengen visas in 2017 came from Russia.

BENCE GAÁL

The website compiled data from consulates last year to create a comprehensive picture of where Schengen states receive most applications from. In the case of Hungary, most applications for short-stay Schengen visas arrived from Russia.

The Moscow consulate alone received

46,049 applications,

with the number of applications from Yekaterinburg also more than 10,000.

The St. Petersburg and Kazan consulates also received a considerable number of applications, with the total amount of applications submitted in Russia amounting to 61,690. The rate of visas not issued was just under 1%, with 602 applications denied.

Ethnic Hungarians

Perhaps unsurprisingly, consulates in Ukraine received 59,591 applications, which puts the former Soviet republic in second place, just behind Russia. A large portion of the applications came from Berehove and Uzhhorod, both cities with a significant ethnic Hungarian population. The two consulates together saw 39,609 applications submitted, with the consulate in Kiev receiving just under 20,000. Some 686 applications were denied in total in Ukraine, amounting to more than 1% of all submissions.

In third place, consulates in China received 28,230 applications. About half of the applications were submitted in Beijing, with Shanghai and Chongquing also receiving thousands. The amount of denied applications was significantly higher than in Russia and Ukraine, with a total of 1,390, amounting to almost 5% of visa applications.

Consulates in Istanbul, Turkey; Almaty, Kazakhstan; and Mumbai, India; also received a large number of applications, propelling them to the top ten cities in the ranking.

The highest rate of rejected applications came from Algiers, Algeria, with a

staggering

64.1%

rejection rate.

A numerically insignificant number of applications resulted in “Limited Territorial Validity” visas, meaning that holders may only enter specific countries named in the document instead of all Schengen states.

The five-star Hilton Budapest has been named “Hungary’s Leading Hotel” at the World Travel Awards Europe 2018.

The 25th edition of the awards saw Hilton properties sweep 19 titles. This year’s European gala took place in Athens, Greece on June 30. Hilton Budapest, located in the capital’s Castle District in Buda, won the title of “Hungary’s Leading Hotel” through the votes of international travel and tourism professionals.

“It is an honor to have been recognized by the World Travel Awards 2018,” says Zoltán Árvai, general manager of the 322-room Budapest Hilton. “The award is testament to the genuine passion and dedication our hotel puts into going the

Junior associate SÁRHEGYI AND PARTNERS LAW FIRM

Many people have dreamt about eating and drinking while floating in microgravity, just like real astronauts.

This dream will soon become a reality, as a few companies are pioneering the challenging goal of making space travel available for everyone.

This new market is called space tourism.

by 2020. But they also aim to further decrease this number, and the final goal is to reach USD 50,000. That means that anyone who can afford to pay USD 50,000 and has good physical and mental health could become a space tourist.

Space tourism mainly focuses on providing the feeling of being in space. For this reason, the first trips will only last for a few minutes, hours at most, enough for space tourists to perceive the feeling of being in a microgravity environment and then return home. During this short period of time they can experience what it is like to be an astronaut at the International Space Station.

Of course, the owners of these aerospace companies have long-term visions for how space tourism could develop. Blue Origin, for example, says it plans to organize trips for space tourists around the moon, as even to establish a moon base to begin building a human colony on the moon.

It is probable that many people have

World Travel Awards Names Hilton Budapest Hungary’s Leading Hotel

BENCE GAÁL

Dr. István Sárhegyi

extra mile for our guests. Thank you to all of our amazing team members at Hilton Budapest who are the heart of Hilton; without them we wouldn’t have been recognized for this great achievement.”

The hotel’s recognition highlighted its newly renovated interior, as well as its commitment to quality leisure and conference facilities including various indoor and outdoor venues, meeting rooms for a range of different events, and hotel rooms with a view.

The World Travel Awards were established in 1993 to acknowledge, reward and celebrate excellence in the sector. According to the organizers, they are recognized as the “ultimate hallmark of quality worldwide”.

heard about Elon Musk’s SpaceX, but

The emergence of the whole market

how many have heard about other

of space tourism is the result of an

aerospace companies such as Blue

international trend that is known as

Origin, which belongs to the world’s

New Space. At the core of New Space

richest man, Jeff Bezos, or Sir Richard

is the global emergence of the private

Branson’s Virgin Galactic? These

spaceflight industry. These new

companies are the tools through

members of the space industry

which the above-mentioned

have strengthened and earned

multimillionaire businessmen hope

the right to be part of the market,

to establish space tourism.

along with national space agencies (NASA, ESA, Roscosmos etc.).

We have already seen a few space tourists. For instance, the Hungarian-

For now it seems that New Space

born American computer businessman,

has prompted cooperation between

Charles Simonyi, has already been to

national and private space companies.

the International Space Station twice.

However, it is more likely that private

Simonyi is considered a space tourist

companies are willing to overgrow their

rather than an astronaut, because he

national competitors, and space tourism

paid an enormous amount of money in

could definitely be a solution for this,

order to book a trip to the ISS. So far

therefore we follow the developments

this has distinguished the astronauts

of this sector with great interest.

from the tourists.

However, the main aim of Jeff Bezos and Richard Branson is to make space tourism available to the general public.

They have both promised to lower the price of space travel to USD 250,000

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NOTE: ALL ARTICLES MARKED INSIDE VIEW ARE PAID PROMOTIONAL CONTENT FOR WHICH THE BUDAPEST BUSINESS JOURNAL DOES NOT TAKE RESPONSIBILITY

Russia Tops List of Shortstay Schengen Visa Applications for Hungary

Special Report | 13

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Special Report

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Budapest Business Journal | July 13 – July 26, 2018

Enjoy the Greatest Service in Business and Premium The First LOT Dreamliner took off from Budapest Ferenc Liszt International Airport for New York on May 3, restoring direct flights from the Hungarian capital to major U.S. destinations after a break of seven years. From now on, Hungarian passengers can travel conveniently to New York and Chicago.

Chicago

BBJ

But that’s not all. All flights are operated by the most technologically advanced aircraft in the world – the Boeing 787

first steel-frame skyscraper. Though it was demolished in 1931, the iconic John Hancock Center, the Willis Tower Chicago is the bustling international city whose marketing line is that it feels (formerly the Sears Tower) and the like home. Located by Lake Michigan in Tribune Tower are all found here.

The city’s O’Hare International Illinois, the City of Chicago is the third most populous city in the United States, Airport is the one of the busiest in the world; little wonder that Chicago after New York and Los Angeles, with was the second most visited city in more than 2.7 million residents.

Although many think the skyscraper the United States with 55 million domestic and international visitors in is synonymous with New York, it 2017, according to the mayor’s office. was actually Chicago that was its As the official chosechicago.com birthplace: the Home Insurance website puts it: “You can visit worldBuilding, completed in 1885, was the

Dreamliner. Business and Premium Economy Class passengers can now enjoy a new quality offer.

There is no better way of travelling than to fly aboard Boeing 787 Dreamliner: it

class museums, dine at one of our many Michelin-star restaurants or catch a show in one of over 200 theaters. No matter what you love to do, you’ll feel right at home doing it here. There are plenty of things to do in Chicago, including tours, spectator sports, shopping and other attractions. Our nightlife doesn’t stop either with plenty of bars and nightclubs, live music and comedy clubs. No matter your budget, you’ll find a hotel to match so start planning your visit today!”

guarantees an unforgettable experience each time, from the moment of takeoff until landing.

For business and corporate passengers, LOT ensures the highest quality of service and uncomparable level of comfort. For Business Class passengers, the enjoyment starts even before takeoff. At the dynamically growing Budapest airport they can take the advantage of priority check-in (through a dedicated business check-in counter), as well as additional piece of mind guaranteed by registered luggage. Fast track service enables you to get through security clearance easier and less stressfully. Business Class passengers also have a dedicated lounge at the airport, and guaranteed priority boarding. Onboard the Dreamliner, passengers in this class travel in an intimate cabin limited to 18 seats. All are easily convertible to a fully flat bed, and are equipped with large screens. The experience comes with top restaurant quality cuisine, with a wide choice of beverages and personal service.

LOT’s Premium Economy Class is dedicated to those passengers who value a top quality product at a reasonable price (best value for money). Before departure, LOT provides priority check-in at the airport and boarding priority. On board the Dreamliner, LOT offers 21 modern wide and comfortable seats with individual arm rests and footrests. The offer also includes

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Budapest Business Journal | July 13 – July 26, 2018

PRESENTED CONTENT

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Special Report | 15

Economy Class on the Way to New York and Chicago

New York New York, as the city proudly proclaims, is both famous and original, a place that celebrates “hustle and heart”.

The City of New York is not just the most populous city in the United States (estimated 2017 population of more than 8.6 million), it is also the most densely populated major city in the country, and the most visited: an estimated 62.8 million tourists visited in 2017, the mayor’s office says.

New York City lies where the Hudson River meets the sea, and where the Statue of Liberty looks out across the Atlantic Ocean. At its core is Manhattan, one of the world’s major commercial, financial and cultural centers. And even if Chicago has dibs on inventing the skyscraper,

an upgraded menu served on porcelain plates, with top quality cuisine and a wide choice of beverages and tasty snacks together with personal service.

Flights to New York on the state-ofart B787 Dreamliners leave four times a week: on Mondays, Thursdays, Fridays and Sundays, aircraft depart Budapest at 11:55 a.m. The non-stop flight takes just 9 hours and 45 minutes.

Flights to Chicago are operated twice a week: on Tuesdays and Saturdays with the total travel time of 10 hours, 15 minutes.

On its Budapest flights to Chicago and New York, LOT offers a truly Hungarian experience onboard with access to an entertainment system in the Hungarian laguage, traditional cuisine across all cabin classes as well as local papers and a selection of original wines for LOT Premium Economy and LOT Buisness class. To ensure top quality service, these

flights are operated by Hungarian crews.

Dreamliners are the most technically advanced aircraft in the world. Composite materials, i.e. carbon fiber reinforced plastic, make up 50% of its weight and 80% of its structure volume. Composites are much more durable, yet lighter than aluminum, resulting in less weight, extended range and lower fuel consumption.

What is more, the passenger experience is much higher thanks to larger windows and a spacious cabin. The Dreamliner has LED lighting and windows with dimming features to help reduce jet-lag. The composite airframe structure helps retain higher pressure in the cabin, which in turn makes it easier to control temperature and air humidity. That is why the Dreamliner offers an unparalleled comfort compared to competitive aircraft of that segment available on the market.

NYC has its own iconic contributions to make to the genre, not least the Empire State Building.

Despite all those buildings and people, there are still open spaces to enjoy, none more so than the sprawling Central Park. And don’t forget Wall Street, or Times Square, or Broadway.

As the official website, nycgo.com puts it: “The dreamers, the doers, the never-settlers: they all come to New York City in search of the same intangible thing. It’s a feeling. A flavor. A pulse. A purpose. It’s our proprietary blend of hustle and heart, and we wish we could bottle it. It’s world famous and one-of-a-kind original…. Everybody wants a taste, but it’s better to stop and savor the whole thing. Only then can you get to the true New York.”

Warsaw Krakow London

New York

Budapest Ferenc Liszt International Airport

Chicago

Besides the U.S. destinations, LOT operates three more direct flights from Budapest to Warsaw 5/day; Krakow 6/week and from February 2019 London City Airport 2/day with Bombardier Q400s and Embraer 190s aircrafts.

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Budapest Business Journal | July 13 – July 26, 2018

Hungary Ambitiously Building on Record Tourism Figures As any stroll through central Budapest will attest, tourism is booming. Registered guest nights in the capital were up 8% last year, topping a record ten million.

In Hungary, guest nights show a 70% rise since 2009, when the economic crisis hit. Such numbers are attracting both domestic and global interest, says Péter Kraft, a former ambassador who runs his own eponymous tourism consultancy.

Péter Kraft For Kraft, the attractions are clear: “In the hotel business, if [properly run] you have, say 45% occupancy, you cover the expenses, and you are able to pay back the loans. If you have an occupancy of 60%, you are making a reasonable return.

If you have 70% and over, that is a cash machine!”

On the domestic side, the boom has attracted leading business interests that have previously steered clear of the sector.

“One of the industrialists from among the 100 richest men in Hungary came to this office and told me that he’d decided ‘to have my own hotel. Can you get one for me?’ So we are looking for a hotel now, for him, in the range of EUR 10 million–20 million.”

capital. Kraft is particularly proud of his efforts to bring Sheraton to Kecskemét (92 km southeast of Budapest), and Marriott Autograph to Pannonhalma Abbey, near Győr, 121 km away to the west [see box, below].

In another project, Kraft is aiming to bring an international brand to the littleknown spar village of Bogács, about 146 km northeast of Budapest, in the Bükk foothills.

“You’ve never heard of Bogács, but we did our research, and it attracts

a tough task.

The international hoteliers were dismissive. “They said: Pannonhalma?

Who cares?” So Kraft pointed to the industrial park at Győr, 14 km distant.

“I said it has 116 companies, from 13 different nations, together with

later than originally hoped. Ever the optimist, Kraft brushes off the delay. “The Benedictine order has been there since before King Saint Stephen established the Hungarian kingdom,” he says, “A year or two doesn’t make much difference.”

Such optimism for the sector is admirable, but with the current level of interest, especially from those wellconnected to government, isn’t the sector at risk, both in terms of a level playing field, and, ultimately, of an investment KESTER EDDY bubble?

“Mr. Mészáros [Lőrinc Mészáros, often “Hungary’s tourism is continuously portrayed by the opposition as a front man performing very, very well. We sometimes for Prime Minister Viktor Orbán] and ask ourselves why are we so successful?” people close to the highest political levels says Kraft, before answering his own have decided to invest in hotels. Some hotel question, reeling off attractions, from managers … how to put it, are critical … asking an ever increasing offering of cultural how Ráhel Orbán [the prime minister’s guest nights events via “world-class” public transport daughter] could become so important in the per year. The mayor is very entrepreneurial,” tourism industry,” Kraft admits. and a safe environment in the capital to he says. stupendous night-time illuminations.

“My comment is that they are totally Nor is potential development limited to For Kraft, who runs his own tourism wrong, because now we have a first-class Budapest Expansion high-end hotel investment. Depending on consultancy, such expansion means work, lobbyist that tells her father how important International hotel companies, “mostly conditions, well-designed, well-run hostel and lots of it. tourism is at Sunday lunch. Suddenly, we from Europe”, are also increasingly eyeing operations can outperform even luxury hotels. have significant support for the industry at “I’m dealing with, I don’t know…. ten expansion in Budapest. “They say: either projects in Hungary, and talking about the highest level,” he argues.

More is More get me a functioning hotel, or a building another 100, of which And the risk of an investment bubble?

“A hostel may have eight or ten beds to a I can convert into a hotel, or give me a “The last time that was asked was by a room. At EUR 14 per bed, that makes EUR piece of land, and I’ll build a hotel. There Russian investor in this office. My response are 140. With a high occupancy rate, it means are quite a number of transactions like was, when we have three times as many in Hungary. Of these, we’ll probably a higher return than a room in a five-star, that going on,” he says. three-, four-, and five-star hotel beds as in get 15-20 [associated contracts] in the while the investment is significantly lower.

Moreover, serious international interest Prague and Vienna, then we have the risk next three years,” he says.

There is business all around!” insists Kraft. of a bubble,” Kraft retorts. “Currently we is now making an impact outside the only have roughly one-third as many as those cities.”

A comparison with Prague and Vienna an annual turnover of EUR 6 billion. may sound reasonable, but is it realistic?

Pannonhalma to Host Marriott Boutique Brand That was the turning point: they said Vienna, in particular, is richer, acts as a ‘We’re coming next week’.”

UNESCO World Heritage site, The Benedictine monastery at regional hub, and boasts OPEC and United Kraft proved successful in luring and Habsburg princes were Pannonhalma, near Győr in western Nations offices. Kraft is unfazed.

Marriott to operate the hotel – educated at its school – selling Hungary, after toying with building a “Today, tourism represents about 10% although work is only expected to 250-rooms, five-star hotel, settled on the site to a hospitality executive of GDP. The decision has been made for start on the project later this year, from outside the region proved a more modest, four-star, 100-room tourism to represent

100,000

50%

scheme proposed by Kraft in 2016.

He was then charged with bringing in an international hospitality brand as the operator.

But while Pannonhalma features strongly in the mindset of a historically minded Magyar – it is a

16% of GDP

by 2030. That is 50 million room nights [per annum]. That is government, national strategy that targets that,” he says. “So, we know where we want to go, and there are plans and these are quantified.”

4

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Budapest Business Journal | July 13 – July 26, 2018

Light and Dark: French Film Maker Documents Budapest Party District Budapestʼs “party district”, also known as the “PartyZone” is gaining global fame: the inner section of Erzsébetváros, the location of the shortlived Jewish ghetto in World War 2, today hosts a constant throng visitors. All are keen to sample both the many “classical” restaurants along with the district’s trademark romkocsma, or “ruin pubs”. But – aside from the fun and frolicking – this seeming success has spawned a growing, troublesome, darker side.

capital’s PartyZone and its growing international reputation as an “affordablefun-loving-destination” – along with its downside issues.

It is five in the afternoon on Kazinczy utca, Budapest VII, but already the streets are quietly buzzing with tourists, some buying eats from street-food stalls, some drinking

Régis Desconclois in the pubs and cafés, others merely window-shopping. For Régis Desconclois, a French TV film maker, it is an ideal time to begin shooting the Budapest scenes for his documentary on the Hungarian

But the growing popularity of the location, the ever-increasing crowds and everlonger opening hours have brought their own issues. Indeed, for many, the party district has already become a victim of its own success.

The deeply disenchanted include Garai, now a leader of Élhető Erzsébetváros (essential translation, Make Erzsébetváros livable again) an NGO formed to restore what local citizens regard as their lost right to normal living in their own homes.

“When this whole thing started to evolve, in the beginning it was OK.

loutishness of late-night revelers. (Garai herself has moved to a quieter part of Erzsébetváros.)

And alongside the legal commercial activity, drug dealers also work the streets, she and others stress. “We recognize their faces,” she says. Despite repeated complaints to both the district council and police, the authorities rarely take action, she alleges. (Requests to the police and district council for interviews for the documentary were declined.)

Changed Character

John Bienias and Karen Culver, a British couple who moved into Kazinczy utca

11

years ago,

share Garai’s experience. Originally attracted by the fun, local atmosphere, they say the “character” and number of visitors has changed in recent years.

“I was born here, and have lived here for 30 years.

Nobody has the right to chase me away.”

Dóra Garai Desconclois has already shot the departure of a compatriot’s bachelor party group from Paris, and plans more “flyon-the-wall” scenes with the gang as they explore Budapest’s many attractions.

But for now, with your correspondent, he is working to document the placid, early evening scene near what today is arguably the district’s number one tourist destination – Szimpla kert.

Touting itself as the precursor of Budapest’s unique romkocsma trend, Szimpla kert began life as an alternative pub in an abandoned nearby housing block

in

KESTER EDDY

Growing Popularity

Special Report | 17

2002.

Its philosophy was very simple – never mind the patched furniture, threadbare carpets and unplastered walls, just have a drink (or two) and soak up the relaxed atmosphere among friends.

The concept was readily accepted by locals (District VII traditionally being a liberal location) and, as ruin-pubs proliferated, its fame quickly spread across the capital, especially among the youth, who delighted in the affordable prices, unpretentious decors and wildly lax opening hours.

Before long, foreign tourists too discovered the delights of this quirky scene, and with details reported in the likes of the Rough Guide, it rapidly became a popular “must-do” when coming to Budapest. Today, though nobody knows the true numbers, it is arguable that a majority of the visitors that constituted the capital’s ten million guest-nights in 2017 made at least one trip into this heady, exciting locale.

“There were approximately 700 pubs and restaurants here at the last count, all in an area of just 0.5 square kilometers, but it’s hard to keep track of the exact numbers,” says Dóra Garai, who was born and raised in Akácfa utca, on the eastern side of the party district. “Certainly, there are tour companies which specifically focus on guiding groups [of foreigners] from ruin pub to ruin pub.”

It was convenient. As a teenager, I could go out, and I was home in five minutes. It wasn’t risky… it was for us, it was for the locals,” she says.

But in recent years, that has all changed: as each evening turns to night, the more serene ambience turns to hard partying, loud dance music, and very heavy drinking.

From around midnight on, groups roam the streets, singing, shouting, and, more recently, vandalizing property, especially parked cars.

“A club opened under my flat, and I tried to sleep every night with the boom, boom beat coming through my pillow,” says Garai. “I’ve seen a row of cars with their wing-mirrors broken, people jumping on the bonnets. I’ve had to buy ten wing-

John Bienias

“It used to be people would come here, enjoy the ambience, have a few drinks, and clear off,” Bienias says. “Now, it seems that people are coming to get as drunk as possible, as cheaply as possible.

I think there’s a culture of ‘we’re away from home, we can do whatever we like, and it doesn’t matter’. And that’s a problem.”

Their sleep regularly disturbed by drunken revelers every night, they rise to find the street cleaned but piles of detritus – anything from packaging, bottles, pizza slices, vomit and urine – left in their doorway.

And there are drug dealers, who regularly trade near their door, untroubled by police on the opposite side of the street.

The couple are near breaking point, saying they will, reluctantly, move out if nothing is done to address the situation.

Garai, along with many supporters in her NGO, refuses to give up the struggle, regardless of official inaction.

“I was born here, and have lived here Karen Culver for 30 years,” she told the Budapest Business Journal after the documentary mirrors myself, and I’ve sold my nice cars. was aired in late June. “Nobody has the Now, I use a Swift. I don’t mind if [and right to chase me away.” when] it gets damaged.”

Garai, who testified on camera to Desconclois for the documentary, reckons Desconclois’ documentary is that roughly half the district’s original

45,000 residents

have moved away in the past decade, unable to stand the noise, litter and general

available (in French only) at: bfmtv.com/mediaplayer/ video/budapest-la-fete-sanslimite-1085469.html

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Budapest Business Journal | July 13 – July 26, 2018

Creating a Vision and a Plan for a Four Season Hungary cultural version in the fall. We are currently working on it; hence I don’t want to share more details, but we would like everybody who sees the upcoming campaigns to honestly wonder about Hungary’s cultural, artistic, architectural offerings, and to see Budapest and Hungary as a four-season destination, always awaiting visitors with a wide range of experiences.

The Budapest Business Journal sat down with the head of the Hungarian Tourism Agency (MTÜ) Zoltán Guller to discuss the “Spice of Europe” marketing campaign and future trends in tourism here.

BBJ: What are the priorities for MTÜ for the next few years?

ZG: The government is committed to growing Hungarian tourism’s competitiveness. It has set a clear goal:

It’s a huge change in vision; we do not think about “doton-the-map” style scattered developments that are completely independent of each other. Instead, we have placed the developments on a destination-based platform, and at the same time, all state tasks related to the strategic control of the industry was delegated to one actor. Doing away with the past’s institutional fragmentation means a change in vision, which brings the possibility of a real turn for Hungarian tourism.

BBJ

BBJ: The Spice of Europe marketing campaign was launched this spring. How satisfied are you with the initial results?

Zoltán Guller: We started our first international Budapest-focused campaign on May 15. The “Spice of Europe” campaign began with a youthful, creative image, which included the creation of a new tourism logo, a new website and creative contents, and the birth of a new image movie that presents Budapest, the capital’s metaphorical “spiciness”, and the fact that the city is accessible, offering many kinds of experiences.

We concentrated on three target groups during the campaign: valueaware young people between 25 and 40; families looking for experiences; and world-travelers between 30 and 55. We believe that, with this, and the planned international campaigns of the next period, we can make Budapest a top European capital. We would like people travelling to or inside Europe to consider, apart from London and Paris, Budapest an unquestionable necessity to see. Our goal is to overtake Prague, and to “lay siege” to Vienna. So we want to overtake Czech touristic numbers, and our aim is to achieve Vienna’s numbers in each and every segment.

The campaign started on May 15, and ran until the end of June; we advertised online, in print, and on television platforms. We spent 65% of the available budget on online platforms, so there were much fewer appearances in print, and mainly it was the internet platforms that received an emphasized role. We spent 25% of the budget on television appearances; CNN served as our number one global media partner during the campaign.

Some 19.34% of the campaign’s media budget was spent on the communications platforms of various airlines. We appeared on board Iberia, British Airways, Lufthansa, WizzAir, American Airlines, and United Airlines. We were present in WizzAir’s June-July issue with an eight page supplement, reaching

Zoltán Guller five million passengers. Through American Airlines’ multiplatform appearances, we have reached 17 million travelers via the videos on the built-in onboard screens, and ads in the onboard magazines.

The campaign ran in the markets that send most tourists to Budapest. We bet on the horses that were already in the front, so the MTU’s spending were directed towards those countries where we have a significant number of tourists already.

Our ads appeared in: Germany; the United States, the United Kingdom; Spain; France; and Italy BBJ: Why was the campaign launched now?

ZG: Hungary’s touristic development has been growing at a faster pace than the regional average, the EU average, and the world average. Seeing the tendencies produced by Hungarian tourism and hospitality since 2010, the government reorganized the state control of the sector. It created the Hungarian Tourism Agency as a kind of lead organization for the industry, in order to utilize

available sources more effectively and more thoughtfully, and to do large-scale marketing-communication operations in order to encourage more people to arrive in Hungary, and spend more time here.

So we started the work in 2016, we’re running our fourth domestic campaign since the summer of 2017, and we were ready by spring 2018 to step on to the international scene.

But we’re not the only players on this field. Due to the increased competition because of globalization, the importance of the “country-brand” has become more valuable, as countries are competing on multiple fronts for the attention of investors, tourists, the consumers of the country’s products, the media, the highly-qualified foreign workforce, and the governments of other countries.

BBJ: Should we expect more international campaigns, targeting other parts of Hungary?

ZG: The “Spice of Europe” international campaign was the first station, but naturally not the last: we will start a

Until 2030, raise the current number of 30 million guest nights to 50 million (in 2010 the number was 20 million guest nights). Also, ensure the industry contributes 16% to GNP, instead of the current 10.5%.

To achieve this, the National Tourism Development Strategy 2030 was made last fall. Briefly, its mission is to tell Hungary’s story and to ensure the country’s growth through tourism.

It’s a huge change in vision; we do not think about “dot-on-themap” style scattered developments that are completely independent of each other. Instead, we have placed the developments on a destination-based platform, and at the same time, all state tasks related to the strategic control of the industry was delegated to one actor. Doing away with the past’s institutional fragmentation means a change in vision, which brings the possibility of a real turn for Hungarian tourism.

According to the vision of the strategy, tourism will become a key industry of economic and job growth by 2030. Hence, Hungary will take a great step in the direction of becoming Central Europe’s leading destination.

In the next period, our medicinal and thermal waters will get an accentuated role, and in the field of health tourism a development of HUF 150 billion-200 billion may be realized in the future. More than 1,000 accommodations will be revamped, thanks to our accommodationdevelopment program. The naming of the emphasized tourism development areas has begun, and is in progress, and we are working on making the tourism aspect appear in transportation developments.

The renewal of the Balaton train stations belongs here, and so does the creation of the conditions for electric boating.

I think, that due to the large-scale developments, new destinations may become sought-after, which may offer experiences even outside the main season. We believe that Hungary is a four season destination, and we will show it to the Hungarians and the world as well.

BBJ: Where do most foreign tourists come from, how long do they stay and who are the biggest spenders?

ZG: Most arrivals still come from Germany: 2.07 million last year.

The U.K. is in second place. But we experience significant growth from Czech Republic (104%), Poland (91%), Russia (80%), and the United States (79%). The latter numbers may increase further as direct flights have started between Hungary and the States this May. Outside of the Top Ten, the growth in the Asian region has exceeded 150%

Special Report | 19

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Budapest Business Journal | July 13 – July 26, 2018

since 2010, including China and the Korean Republic, where we experienced a growth of unusual proportions, surpassing 350%.

The Top Ten markets sending tourists, guest nights spent in 2017 (change compared to 2010) 6

“I think, that due to the large-scale developments, new destinations may become sought-after, which may offer experiences even outside the main season. We believe that Hungary is a four season destination, and we will show it to the Hungarians and the world as well. ” According to KSH’s freshest data, Hungary’s popularity among foreigners jumped highest among the Romanian arrivals in April, the number of guest nights increased by 21.8% among the group, but the United States is also showing a serious increase (12.5%), and Russia as well (7.3%), compared to last April.

In this year’s first four months, we have registered a growth of 4.2% from Germany, our most important sending market, meaning that the growth which started last year has carried on.

United States 747,000 (+79%)

Russia 675,000 (+80%)

United Kingdom 1.02 mln (+101%)

Poland 750,000 (+91%) 8

Germany 2.07 mln (-1%)

2

Czech Republic 888,000 (+104%)

Slovakia 481,000 (+157%)

5

1 3

10

4

9

7 Austria 860,000 (+14%) Italy 710,000 (+43%)

Romania 568,000 (+54%)

BBJ infographic

Source: MTÜ

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1051 Budapest, Erzsébet tér 7–8.

(1) 429-3777 (1) 429-4777 hotel.corvinus@ kempinski.com

– CP Holdings Ltd. (100)

zoltán árvai Katalin Miszkiewicz Éva Keller

1014 Budapest, Hess András tér 1–3.

(1) 889-6600 (1) 889-6644 info.budapest@hilton.com

✓

✓

oWneRsHip (%) HungaRian non-HungaRian

top local executive cfo maRketing diRectoR

addRess pHone fax email

✓

1981 2017

Al Habtoor Holding Kft. (100) –

claus geisselmann – –

1052 Budapest, Apáczai Csere János utca 12–14.

(1) 327-6333 (1) 327-6357 budapest@ihg.com

–

2003 2017

– International Hotel Investments Plc. (100)

Jean pierre mifsud Csaba Pálos –

1073 Budapest, Erzsébet körút 43-49.

(1) 479-4800 (1) 479-4333 budapest@corinthia.com

– CEE Property - Invest Inmobilien GmbH (100)

arne klehn John Majosi Mária Kocsis

1052 Budapest, Apáczai Csere János utca 4.

(1) 486-5000 (1) 486-5005 budapest.ays@marriott.com

otHeR

event

✓

✓

caR Rental

✓

✓

inteRnet in Rooms

✓

✓

gaRage

✓

✓

beauty salon

✓

✓

Wellness

✓

✓

family fRiendly

✓

1994 2018

✓

business coRneR

7,939

399 399

RestauRant

7,517

250–600 270–630

yeaR establisHed yeaR last Renovated

402 603 26 12

single Rate (euRo/nigHt) double Rate (euRo/nigHt)

inteRcontinental budapest / inteRcontinental Hotels gRoup mansion danube HungaRy kft.

total net Revenue in 2017 (Huf mln)

1

Hotel name / name of opeRating company Website

no. of Rooms no. of beds no. of suites no. of meeting Rooms

Rank

seRvices

www.budapest.intercontinental.com

2

coRintHia Hotel budapest / iHi magyaRoRszág zRt.

383

budapest maRRiott Hotel / duna szálloda zRt.

7,354

www.marriottbudapest.com

364 478 22 17

229 239

sofitel budapest cHain bRidge / accoR-pannonia Hotels Szállodaüzemeltető zrt.

357 700 56 17

23,080 (2016)

360 320–430

kempinski Hotel coRvinus budapest / kempinski Hotel budapest zRt.

351 702 35 10

www.corinthia.com/hotels/budapest

3

4

www.sofitel-budapest.com

5

7

✓

✓

–

✓

✓

✓

✓

✓

✓

400 400

www.budapest.hilton.com

322 472 24 23

4,067

270-560 270-560

–

✓

✓

–

–

✓

✓

–

✓

✓

1976 2018

tHe aquincum Hotel budapest / tHeRmal Hotel aquincum zRt.

310 620 8 14

2,566

265 265

✓

✓

✓

✓

✓

✓

✓

✓

✓

✓

1991 2017

– Corinthia Investments Ltd. (100)

gábor nemes – –

1036 Budapest, Árpád fejedelem útja 94.

(1) 436-4100 (1) 436-4156 info@aquincumhotel.com

5,992

420 440

–

2006 2012

– Varde Group (100)

oliver Hutten Margit Mátyás Gréta Szuromi

1073 Budapest, Erzsébet körút 9–11.

(1) 886-6111 (1) 886-6192 reservation.nypalace@ dahotels.com

Hilton budapest / danubius Hotels zRt.

www.aquincumhotel.com

8

31 30

7,502

www.kempinski.com/budapest

6

Ÿ

neW yoRk palace / neW yoRk palace kft. www.dahotels.com/ new-york-palace-budapest/

185 252 30 11

✓

–

✓

✓

✓

✓

✓

✓

–

✓

✓

✓

✓

✓

✓

–

✓

✓

Special Report | 21

4

www.bbj.hu

Budapest Business Journal | July 13 – July 26, 2018

9

fouR seasons Hotel gResHam palace budapest / fouR seasons Hotels inc. www.fourseasons.com/budapest

10

tHe Ritz-caRlton, budapest / adRia palace kft.

www.ritzcarlton.com/budapest

11

12

neW yoRk Residence / neW yoRk palace kft. www.dahotels.com/ new-york-palace-budapest/ residence

maRRiott executive apaRtments / duna szálloda zRt. www.marriottbudapest.com

buddHa-baR Hotel budapest klotild palace / melloW mood invest kft. www.buddhabarhotel.hu 13

14

15

16

171 216 29 5

138 269 138 –

108 216 – –

102 208 27 3

ibeRostaR gRand Hotel budapest / ibeRostaR HungaRy kft. www.iberostar.com

50 124 3 1

aRia Hotel budapest / ik Hotels kft.

49 52 5

www.ariahotelbudapest.com

Ÿ

st. geoRge Residence all suite Hotel de lux / st. geoRge apaRtmanHáz kft.

26 52 26 2

www.stgeorgehotel.hu

17

179 358 19 9

baltazáR boutique Hotel / zsidai gRoup

www.baltazarbudapest.com

Ÿ= would not disclose, NR = not ranked, NA = not applicable

11 22 4 1

Ÿ

3,818

5,992

335-930 335-930

310–460 330–480

350 350

✓

✓

–

✓

✓

✓

✓

✓

✓

✓

✓

✓

–

–

✓

✓

–

✓

✓

✓

✓

–

–

✓

✓

✓

–

yeaR establisHed yeaR last Renovated

oWneRsHip (%) HungaRian non-HungaRian

top local executive cfo maRketing diRectoR

addRess pHone fax email

2004 2017

– (100)

yves giacometti – –

1051 Budapest, Széchenyi István tér 5–6.

(1) 268-6000 (1) 268-5000 budapest.pbx@ fourseasons.com

2015 2018

Al Habtoor Holding Kft. (100) –

Rahim abu omar – Petra Schulhof

1051 Budapest, Erzsébet tér 9–10.

(1) 429-5500 (1) 429-5555 concierge.budrz@ ritzcarlton.com

2011 2012

– Varde Group (100)

oliver Hutten Margit Mátyás Gréta Szuromi

1073 Budapest, Osvát utca 2–8.

(1) 424-4700 (1) 424-4700 reception.nyresidence@ dahotels.com

✓

1969 2018

– CEE Property-Invest Immobilien AG (100)

arne klehn John Majosi Mária Kocsis

1052 Budapest, Piarista utca 4.

(1) 235-4888 (1) 235-1900 budapest.reservations@ marriott.com

–

2012 2012

Mellow Mood Invest Kft. (100) –

andrea schwindt-kiss Kata Szalóky Noémi Oláh

1052 Budapest, Váci utca 34.

(1) 799-7300 (1) 799-7301 info@buddhabarhotel.hu

–

2011 2017

– IBEROSTAR Hotels & Resorts (100)

antonio montoro – –

1051 Budapest, Október 6. utca 26.

(1) 354-3050 (1) 269-0687 grand.hotel.budapest@ iberostar.com

IBE Kft. (50) Henry Kallan (50)

zoltán kecskeméthy Dorottya Drén Katalin Moór

1051 Budapest, Hercegprímás utca 5.

(1) 445-4055 (1) 445-4055 stay@ariahotelbudapest.com

otHeR

event

caR Rental

inteRnet in Rooms

gaRage

beauty salon

Wellness

family fRiendly

business coRneR

RestauRant

single Rate (euRo/nigHt) double Rate (euRo/nigHt)

total net Revenue in 2017 (Huf mln)

Hotel name / name of opeRating company Website

no. of Rooms no. of beds no. of suites no. of meeting Rooms

Rank

seRvices

✓

–

–

7,354

160 160

2,525

350 370

Ÿ

Ÿ Ÿ

Ÿ

300-1100 300-1100

–

✓

✓

✓

✓

✓

✓

–

✓

–

2015 2015

237 (2016)

129–269 139–279

✓

✓

✓

–

–

✓

✓

✓

✓

–

2007 2007

– (100)

gábor Jusztin – –

1014 Budapest, Fortuna utca 4.

(1) 393-5700 (1) 393-5705 info@stgeorgehotel.hu

Ÿ

100–300 100–300

✓

–

–

–

–

–

✓

–

✓

✓

2013 –

Zsidai Group (100) –

zoltán Roy zsidai – –

1014 Budapest, Országház utca 31.

(1) 300-7051 (1) 300-7051 hello@baltazarbudapest.com

–

✓

✓

–

✓

✓

✓

✓

–

✓

✓

✓

✓

✓

–

–

–

–

✓

✓

✓

–

✓

–

–

✓

✓

This list was compiled from responses to questionnaires received by July 11, 2018 and publicly available data. To the best of the Budapest Business Journal’s knowledge, the information is accurate as of press time.

While every effort is made to ensure accuracy and thoroughness, omissions and typographical errors may occur. Additions or corrections to the list should be sent on letterhead to the research department, Budapest Business Journal, 1075 Budapest, Madách Imre út 13–14., or faxed to (1) 398-0345. The research department can be contacted at research@bbj.hu

www.bbj.hu

Socialite

Budapest Business Journal | July 13 – July 26, 2018

Swimming in and Around Budapest: A Dive into the Possibilities One of the things that surprised me when my first summer in Hungary rolled around was just how hot it was. Inevitably, my thoughts naturally turned to swimming.

And in Hungary, the options seem endless.

DAVID HOLZER

Your idea of heaven may be swimming laps in an unheated outdoor pool at the crack of dawn. Or it might be lounging at the lido on a gloriously hot Hungarian afternoon.

Much as a I love a good lido, I prefer what’s come to be called “wild swimming”.

When I first heard the term, I imagined diving into raging torrents. But it’s just a more exciting turn of phrase for taking a dip in anything that isn’t a swimming pool.

There’s something splendidly oldfashioned about swimming in rivers and lakes which feels particularly Hungarian to me.

However you like to swim, there are plenty of places to choose from in and around Budapest.

Chilling at Csillaghegy

Rather than skim the surface with a roundup of the many excellent pools in Budapest where you can do laps or just hang out, I’d rather take a deep dive into one pool.

My partner’s sister and brother-inlaw are serious swimmers as well as connoisseurs of the delights of Budapest.

He’s a Budapester born and bred and she’s a transplant from the country who’s made it her business to know the place better than any native.

Their absolute favorite pool in Budapest is Csillaghegy open air baths and I believe it may even be where they first met. The pool is surrounded by parkland and is built into a terraced hillside. It opened in the second half of the 19th century but was renovated in 2000.

Two rows of cubicles open directly onto the main pool and the restaurant is

housed in a satisfyingly quaint looking building with a terrace.

Serious swimmers like my partner’s brother-in-law, a triathlete, swim in the unheated water of the main pool.

There’s also a leisure pool and another for children somewhere up on the grassy terraces.

Apart from the joys of swimming at Csillaghegy, the restaurant makes what is reputed to be the best lángos in the whole of Budapest. For those of you who don’t already know, lángos is a flat piece of deep-fried dough, often topped with garlic, sour cream and grated cheese.

Good lángos should be crispy on the outside and succulent inside. If it isn’t bigger than your head, you’ve been shortchanged.

Although I’m a serious fan of lángos and take a perverse delight in its sheer unhealthiness, I have yet to compile an exhaustive guide to the lángos of Budapest. But I do respect the inside knowledge of my partner’s sister and her brother-in-law.

Even if you’re not a lángos aficionado, there’s something wonderful about munching on a vast, greasy slice of salty, fatty badness after a vigorous swim. If you’ve just spent an hour or so watching your children splashing around, your only exercise peeping over the top of a book, you’re on your own when it comes to justifying your indulgence.

Wild Swimming

It probably wouldn’t get any wilder than swimming in the Danube. But in most places – like Romai Strand, the fabulous strip of bars and restaurants just outside Budapest proper – you’re prohibited from going more than a meter or two into the river.

Staying with the unhealthy food theme for a moment longer, the best and perhaps only reason to visit Romái is to taste the most heavenly hekk and chips in the whole of Hungary.

I’m afraid I can’t tell you the name of the hekk place. All I know is that it looks like a big wooden shed and it’s on the lefthand side of the path as you’re walking down Romai strand towards Margit hid.

If want to try wild swimming, there are a couple of places you can swim safely not so far from Budapest.

How could you resist wild swimming at a place called Göd? You find Göd about 25 kilometers from Budapest. If you’re feeling energetic, this isn’t too much of a stretch by bicycle.

The Beaches of Göd

On the banks of the Danube, Göd has two beaches. You can choose between sandy or pebbly. Though why you’d want to swim off a pebbly beach, I don’t really know.

I grew up near the British North Sea, which has seriously pebbly beaches and I shudder at the memory of them.

There’s also a sandy island to swim to and indulge your Treasure Island fantasies.

Göd is fully equipped with toilets, showers and changing rooms. You may have noticed that Hungarians don’t really like to do the old wrestling with the swimming costume under a towel routine, so changing rooms are something of a must.

It’s free to bathe here at Göd. You can also hire a bicycle or boat as well as eat and drink. I’m not sure if the lángos is up to the standard of Csillaghegy. You’ll have to find out for yourself.

If Göd doesn’t appeal, you could also head for the Pázsit bathing lake on Szentendre Island, 36 kilometers from Budapest. You can swim or fish at the island. There’s something magical, if a little bit scary, about swimming in a piece of water where large fish occasionally break the water in front of you.

To get to Szentendre Island, head for the oddly Mediterranean village of Szentendre – well worth exploring in its own right – and take the ferry over. You’ll have to pay to swim but it’s still pretty cheap.

The attractions of Szentendre Island include a buffet and restaurant. I’ve not tried the lángos here thus far, but I shall waste no time in doing so.

Go to www.csillaghegyistrand.hu for more information on the pool.

5

www.bbj.hu

Budapest Business Journal | July 13 – July 26, 2018

Socialite | 23

Anything but bad Wine to be had This Summer While some wine lovers abide by the initials ABC (Anything But Chardonnay), the reason for the Chardonnay grape being planted so far and wide across the globe is that it is a damned good grape for making wine from, and also a fine articulator of terroir, something which extends to Hungary.

ROBERT SMYTH

Magyar vintners united in the Chardonnay cause descended on the winemaking town of Etyek in the Etyek-Buda region, just 30 km west of the capital, on June 23 for ChardonnÉJ, an evening celebration of the Chardonnay grape.

While I couldn’t make it to ChardonnÉJ this year – certainly not due to any hatred of Chardonnay – I did have a wow moment when tasting the 2016 Chardonnay from Etyeki Kúria (HUF 2,590 from Bortársaság) on a recent trip to the cutting-edge cellar that’s surrounded by vines up on Öreg-hegy.

Coming from an area of limestone soil from the Nagy-Látó and Öreghegy vineyards, 30% of this wine was fermented and aged (for a year) in oak, with 70% being vinified in tank – and the balance is just right.

The oak lends body but avoids those buttery-vanilla aromas and flavors that were so popular in Chardonnays of old, but are now so out of vogue. Hats off to winemaker Sándor Merész; this Chardonnay is varietally pure with lots of zesty citrus fruit, vibrant and mouth-tingling acidity as well as impressive length.

Thing of Beauty

I must admit that Chardonnay isn’t the first white wine I’m itching to taste in Hungary, given the sheer range of indigenous grape varieties on offer, but a classy Chardonnay is indeed a thing of beauty.

The grape variety is clearly very well suited to the Etyek-Buda region with its cooling breezes, limestone soils and balanced climate. Incidentally, participants in ChardonnÉJ selected a local wine – Nyakas Pincészet’s Menádok Chardonnay 2011 as the best wine from a range of Chardonnays from big names from Balaton, Eger, Kunság, Mátra, Mór, Pannonhalma and Tokaj. Mark your diaries for the fifth edition of the event, which will be hosted on June 22, 2019.

While Etyek is putting increasing emphasis on Chardonnay, it is also a great spot for other international grapes, such as Sauvignon Blanc and Pinot Noir, as well as all manner of sparkling wines (including various brands from the Törley group) thanks to the high natural acidity that the grapes capture here.

Austrian grape Grüner Veltliner (Zöldveltelini in Hungarian) can be very good in Etyek-Buda when you can find it. While I was disappointed by the bijou Hernyák winery having sold out of Zöldveltelini, its Királyleányka 2017 (a natural crossing of Leányka and Grasă that hails from Transylvania) saved the day with its rich texture and good structure to back up the grape’s appealing and abundantly floral attack.

It is definitely an underrated grape. The Hernyák winery is also located up on Etyek’s picturesque Öreg-hegy.

Etyeki Kúria’s Pinot Noir is a candidate for the finest from the grape variety in the country (other excellent ones I’ve recently tasted come from Eger’s Attila Pince and St. Andrea). Etyeki Kúria actually grows a third of its grapes in Sopron, whose slate and mica vineyards are the source of a killer Kékfrankos (the 2015 was the winner of the Winelovers’ Kékfrankos Április panel tasting this year).

There’s also Etyeki Kúria Red (HUF 2,050 from Bortársaság) – a blend of Merlot (60%), Kékfrankos, Pinot Noir (5%) and Zweigelt (5%). With its medium body, juicy red fruit and refreshing acidity, the 2016 version is the ideal summer red, and can be served a touch chilled.

Aromatic and racy Sauvignon Blanc is the ideal white wine for keeping cool with in summer.

Etyeki Kúria’s 2017 Sauvignon Blanc (HUF 2,590 from Bortársaság) is crispy yet juicy and mouth-filling with gooseberry and grassy aromas. It was aged on the

fine lees and one-third of it comes from the virgin vintage of new French clones from Kis-Látóhegy.

Skillfully Blended

Another candidate for the country’s best Sauvignon Blanc – at least of the kind made in stainless steel in the fresher, reductive style – comes from the Pannonhalmi Monastery winery, where the wines are made by Zsolt Liptai, a close former classmate of the above mentioned Sándor Merész.

Skillfully blended from grapes coming from two vineyards – the sandy loess of the warmer Széldomb vineyard and the white clay of the cooler Tavaszó, the 2017 gets both the cooler green pepper and green grass character, as well as the riper mango.

While Pannonhalma is often assumed to be a white wine region, the Pannonhalmi winery also makes one of the country’s best reds – Infusio, a blend of Merlot and Cabernet Franc, the 2015 of which has pretty much sold out, just as it was hitting top form. This wine strikes a great balance between depth of flavor and cooler climate freshness.

Incidentally, there are still a few magnums available from the winery itself. There’s no shortage of the light but very bright Tricollis Vörös 2017 (HUF 2,650), a juicy blend of three varieties that’s the ideal summer tipple.

Hungarian aromatic white wines can also come into their own in the summer.

Back in the darkness of November,

While Etyek is putting increasing emphasis on Chardonnay, it is also a great spot for other international grapes, such as Sauvignon Blanc and Pinot Noir, as well as all manner of sparkling wines.

I recall Garamvári Szőlőbirtok’s Irsai Olivér 2017 shining at a South Balaton portfolio tasting. It recently won the Champion prize for white wine at the 2018 edition of the Vinagora wine competition.

Not bad for a wine that costs around HUF 1,000 at Lidl!

Irsai Olivér is an earlyripening crossing of the Csabagyöngye and Pozsonyi fehér varieties, created by Pál Kocsis in 1930. While is often dismissed by sommeliers, it is a vibrantly aromatic grape that appeals to many consumers with its floral, fruity and Muscaty nose. Another good offering comes from the aforementioned Nyakas, from Zsambék in the Etyek-Buda region, which came in well above par in 2017, with nice acidity and substance to hold up the palate and suitably back up the aromas.

BBJournal.jul:Layout 1 6/27/18 5:20 PM Page 1

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