VOL. 30. NUMBER 15
JULY 29 – SEPTEMBER 8, 2022
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SPECIAL REPORT INSIDE THIS ISSUE
Logistics
Boom in Budapest Industrial Market The boom in the logistics and industrial sector continues unabated, as demand remains high and vacancy stands at a record low. Analysts see the market in Hungary and Central Europe as being in a favorable post-COVID position. 15
Sustainability: Logical Choice for Logistics Industrial developers and park operators are building more highly-specified, sustainabilityaccredited projects in response to changing tenant demands and regulations reflecting growing climate and environmental concerns. 16
Delivering on Diversity
SOCIALITE
Matisse Masterpieces on Show Henri Matisse: The Color of Ideas, runs until Oct. 16, 2022 at the marvelous Museum of Fine Arts in Budapest. The exhibition, the first major show of Matisse’s art in Hungary, continues a remarkable run of firstrate exhibitions, writes David Holzer. 26
COUNTRY FOCUS
Thinking Big: South Korean Investments South Korea is the fifth largest investor in the country, and its activity in the EV segment, in particular, could propel Hungary to become a European powerhouse in this rapidly growing area. 11
SPECIAL REPORT
Estonian Andra Ligi, director of sales and marketing at DHL Express Hungary, talks about the company’s growth in the past few years, its zero-emissions targets, and what it is doing to help SMEs and promote equality and diversity. 18 BUSINESS
2 Hungarian Scientists Win NASA Challenge Freelance data scientists and deep learning developers Axel Ország-Krisz and Richárd Ádám Vécsey, longtime friends and collaborators, won the top spot and USD 25,000 in the Aftershock: NASA Shock Propagation Challenge in mid-July. 8
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Budapest Business Journal | July 29 – September 8, 2022
IMPRESSUM
THE EDITOR SAYS
IN CELEBRATION OF BUDAPEST SUMMER TRADITIONS
EDITOR-IN-CHIEF: Robin Marshall EDITORIAL CONTRIBUTORS: Balázs Barabás, Zsófia
Czifra, Kester Eddy, Bence Gaál, David Holzer, Christian Keszthelyi, Renáta Kónya, Gary J. Morrell, Nicholas Pongratz, Gergely Sebestyén, Robert Smyth. LISTS: BBJ Research (research@bbj.hu)
Expat life being what it is, there will be some readers of the Budapest Business Journal for whom this is their first summer here. If you are one of those, let me reassure you that, while it is regularly hot in this country in June, July, and, most especially, August, some of these recent temperatures have, indeed, been unusually high. One of the great things about Budapest, though, is that people just get on with it. They hydrate as much as they can, even willing to resort to water if there is no pálinka to hand (I jest: there is always pálinka to hand). They also rediscover an affection for the workplace that was noticeably missing in spring. The fact that all modern offices in Budapest have air conditioning is undoubtedly a coincidence. It makes for an interesting “compare and contrast” exercise with the United Kingdom, which had two days around 40ºC (104ºF) and promptly had a collective faint. That is slightly harsh. The British are not just Northern Europeans; they are also an island race and, therefore, utterly unsuited to any temperatures above 28ºC (82ºF). It took me about five years to adapt. But back to our newbie readers; there is another Budapest summer tradition with which I should make you acquainted. This is the last print issue of the BBJ you will be able to pick up from your friendly neighborhood newsagent, if that is your somewhat quaint way of getting hold of the paper. You are more likely to have a subscription, but even then, you won’t see another issue for a while. Let me reassure you; unlike the recent mercury-popping temperatures, this is absolutely normal. Every summer since we launched in 1992 (we actually debuted in November, so more accurately, every summer since 1993), we have taken August off. It is the traditional holiday month in factories and offices across the country. The big four automotive OEMs
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(Audi, Daimler, Opel, and Suzuki) often cut shifts right back or schedule routine maintenance in August, for example. There isn’t much point in a business publication printing a paper when the most exciting stories are the cost of watermelons and the availability of cucumbers. But rest assured, we will update the website daily and send out our morning newsletters, and the print issue will return on September 8. In the meantime, we leave you with a bumper issue to enjoy. The paper itself is a 28-pager, with a focus on logistics and a South Korean Country Focus. (Our base issue is 24 pages, though we sometimes drop to 20 and this year set a new record high of 44 back in May. As you would expect from an agile operation, we shuffle the pagination up and down depending on the commercial and editorial needs.) But there is even more reading material for our print subscribers, with our second annual Top Real Estate Executives publication included free of charge and weighing in at a hefty 116 pages dedicated to the themes and personalities behind a vital economic sector. Don’t worry if you do rely on your friendly neighborhood newsagent; you can still buy Top Real Estate Executives through our webshop. And while you are there, you might also check out our newest product, The Macroscope Report, a Hungarian economic overview for Q2 and Q3, helpfully subtitled “How did we get Here, and Where are we Heading?” It is a “mustbuy” for anyone interested in the big picture from Budapest. So there is plenty of holiday reading to tide you over. All that is left is for me to wish you all a relaxing (or stimulating, if that is more your thing) summer break. We’ll meet again in September. Robin Marshall Editor-in-chief
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• Value Creation. We have a nearly 30-year history of supporting the development of diversity and sustainability in Hungary’s economy. The fact that we have been a trusted business voice for so long, indeed we were the first English-language publication when we launched back on November 9, 1992, itself has value. • Crisis Management. We have all lived through a once-in-a-century pandemic. But we also face an existential threat through climate change and operate in a period where disruptive technologies offer threats and opportunities. Now, more than ever, factual business reporting is vital to good decision-making. For more information visit budapestbusinessjournal.com
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THEN & NOW Leopard 2A4 tanks engage in a dynamic presentation at the Tank Armament Day at the György Klapka Rifle Brigade barracks in Tata (70 km northwest of Budapest by road) on July 25, 2022. In the black and white image from the Fortepan public archive, an armored fighting vehicle turns the corner at the junction of Hegyalja út, Budaörsi út, and Alkotás utca in 1940, during the early days of World War II.
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Budapest Business Journal | July 29 – September 8, 2022
News
• macroscope
Central Bank to Carry on With Rate Hikes
Hungary’s base rate climbed into the two-digit region, with the central bank flagging more rate hikes ahead in an effort to fight inflation.
International Monetary Fund: Global Economic Outlook (2021-2023)
July forecast, economic growth, percent
(Estimation)
(Forecast)
(Forecast)
World
World
United States
United States
Euro area
ZSÓFIA CZIFRA
For the first time since late 2008, the base rate in Hungary is again in the twodigit territory. At its rate-setting meeting on July 26, the Monetary Council of the National Bank of Hungary (MNB) raised its key rate by 100 basis points to 10.75%. “It is warranted to tighten the base rate in a decisive manner in order to anchor inflation expectations and mitigate second-round inflation risks,” the Monetary Council said in a statement following the decision, adding that Hungary’s economy was expected to slow in the second half of the year. MNB’s deputy governor Barnabás Virág said a government decision to scrap price caps on energy for higherusage households would add three percentage points to the expected inflation rate over the 12 months to
August
2023.
The MNB will carry on with its interest rate moves “until we can see a clear turnaround in inflation,” Virág said, emphasizing that the bank’s focus was on curbing inflation and second-round impacts even as the economy was set to slow. The decision is in line with analysts’ expectations, and the tightening of the monetary conditions will most likely continue in the coming months, according to them. Analysts polled by international news wire Reuters now see the base rate rising to 12% by the end of 2022, which would be its highest level in nearly two decades. Some analysts project even higher rates.
Upside Risks
“Overall, we expect interest rates to rise to 13% later this year [...]. We think the risks are probably skewed to the upside, particularly if European energy supply is severely disrupted, global growth concerns rise, and the forint comes under further pressure,” Capital Economics said in a note after Tuesday’s rate hike, according to Reuters. András Horváth, head analyst at Magyar Bankholding, stated that
Euro area
Japan
Japan
China
China
Russia
Russia
Hungary
+7.6
+5.1
+3.8
Hungary
Source:
the interest rate decision “roughly corresponded to market prices.” He thinks that the base rate may rise to a peak
of
11.75%
in the fall and remain at this level for a certain period. The one-week deposit rate and the base rate are expected to be reduced in the second half of 2023 at the earliest. As a result of the conflict in Ukraine, the rise in energy, raw material and food prices continued, so the easing of shortterm inflationary pressure is still unlikely, he opined. The current global inflation is mainly increased by the sharp rise in the prices of goods necessary for living, but this alone will slow down economies due to the decline in purchasing power. Therefore, it would be worthwhile avoiding over-tightening the monetary conditions, which makes the work of central banks especially difficult, Horváth warned. Zoltán Varga, senior analyst at Equilor Befektetési Zrt., pointed out that, in terms of achieving the inflation target, it is crucial to avoid second-round effects and to anchor inflation expectations. According to the analyst, inflation is expected to return to the central bank’s tolerance band at the end of 2023 as a result of the subsidence of the first-round effects of war tensions, the moderation of external inflationary effects, the fading of the inflationary impact of the tax measures announced in June and the proactive actions of the
central bank. He predicts that the base rate will reach the central bank’s 3% target in the first half of 2024. Varga pointed out that the Monetary Council’s announcement did not contain any surprising news; the MNB is still committed to raising interest rates decisively to curb inflation.
Forint Vulnerability
According to Orsolya Nyeste, Erste Bank’s leading macroeconomic analyst, inflation risks, the vulnerability of the forint exchange rate, and significant interest rate hikes already priced in by the market justified the strong step by the MNB. The decision-makers are still not in an easy situation since the cutback in utility cuts announced a few weeks ago will further increase inflation. In a rising inflationary environment, breaking down high inflation expectations will not be an easy task, Nyeste wrote. Overall, the interest rate decision did not bring any significant surprises: interest rates rose as expected, and rate hikes will continue in the coming months - she concluded. According to Dávid Németh, head of the macroeconomic unit of K&H Bank, based on the current outlook, the interest rate hike cycle may end in December, with a base rate of
around
13%.
He recalled that, based on the previous communication from the central
bank, tightening would continue until inflation reached its peak. The current interest rate hike is still necessary due to inflationary pressure, he said. In June, the main indicator was already 11.7%; moreover, the core inflation calculated without variable energy, food, and official prices amounted to 13.8%, which points to intense price pressure, he added. The interest rate hike is also necessary for the forint exchange rate to stabilize or strengthen, he opined, referring to the fact that the performance of the currency is greatly influenced by how the negotiations between Hungary and Brussels regarding EU funds go.
Numbers to Watch in the Coming Weeks June retail trade data will be published on August 3. The Central Statistical Office (KSH) will release the June industrial output figures on August 5. The July consumer price index will come out on August 9, and the June performance of the construction sector will be published on August 15. On August 17, the flash estimate of the gross domestic product will be out for the second quarter.
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Budapest Business Journal | July 29 – September 8, 2022
Hungary Pledges Support to Ukraine, Seeks gas From Russia Hungary stood alone among European Union member states in voting against the approval of a regulation to reduce gas consumption by 15%. However, it was ultimately agreed through political consensus at a meeting of EU energy ministers on July 26. NICHOLAS PONGRATZ
After the meeting, during which there was “serious debate” over the regulation, Minister of Foreign Affairs and Trade Péter Szijjártó said he voted against it because it is “unfounded, impossible to enforce, and disregards the interests of the Hungarian people.” Under the proposal presented on July 20, all EU member states would pledge to cut their use of gas
by
15%
between August 1, 2022, and March 31, 2023, to stave off a projected energy crisis. The targets would be voluntary,
Ukraine
Crisis
Roundup
Upon visiting areas in and around Kyiv on July 20 that had suffered the most damage in the war, he said Hungary had taken on the reconstruction of a school, in addition to the construction of a small hospital with a post office and a municipal government office in Bucha, which became infamous as a place where many civilians were apparently killed by Russian soldiers and left lying in the streets. While in the capital on July 21, Magyar also reached an agreement with Ukrainian officials on increasing transshipment capacity across the border with Hungary, between Chop, Ukraine, and Záhony (305 km northeast of Budapest), in Hungary. Although the measure would require “big railway investments” from Hungary, he said that a working group focusing on the project is already underway. Speaking on TV news channel M1 In this picture released by the Ministry of Foreign Affairs and Trade, on July 15, Minister of Agriculture Ukrainian Deputy Foreign Minister Mikola Tochitsky (left) receives Deputy István Nagy suggested Hungary ramp Minister of Foreign Affairs and Trade Levente Magyar in his office in Kyiv up its daily transshipment capacity of on July 20. Photo by MTI / Ministry of Foreign Affairs and Trade Ukrainian grain from 4,000 tonnes to but if the European Commission were to declare a so-called “EU alert” on the security of supply, gas demand cuts would be mandatory for all member states. Yet, Szijjártó visited Moscow on July 20 with a government mandate to buy an additional 700 million cubic meters of gas. During the trip, Szijjártó said that Hungary was taking steps to make additional pipeline capacity available for the delivery of 20 million cubic meters of gas a day. He added that the Hungarian government had prepared the financing for the extra gas volume and signed the necessary agreements. Currently, Hungary has enough gas in storage to cover 26.6% of annual consumption, above the EU average of 15%, he said. Days earlier, Szijjártó was among EU leaders who agreed on another round of sanctions against Russia in Brussels on
July 18. He noted that the new package of sanctions would not contain any restrictions on the delivery of energy but instead include an embargo on Russian gold and a tightening of restrictions on the trade of dual-use goods.
Support Pledged
Meanwhile, as the Minister of Foreign Affairs and Trade undertook trips primarily concerned with Russia, Deputy Minister of Foreign Affairs and Trade Levente Magyar, who is also a parliamentary state secretary, paid a visit to several Ukrainian cities, pledging support from Hungary. At a stop in Lviv on July 19, Levente Magyar said that Hungary is prepared to take in and treat wounded Ukrainian children and injured soldiers in large numbers, as well as to expand its humanitarian assistance program in the west of Ukraine.
8,000-10,000 tonnes.
According to Nagy, some 22 million tonnes of grain is stuck in storage in Ukraine due to the blockade of the country’s Black Sea ports, through which 90% of grain exports normally pass. This has left farmers little room to put this year’s harvest and created a disincentive for planting next year’s crop, he said. Since Ukraine grows 9% of the world’s grain, he warned that the situation could cause a global food crisis. Earlier, Nagy had proposed immediate and long-term solutions for facilitating Ukrainian grain exports. For instance, in addition to developing transshipment capacity and storage facilities, processing plants could also be built in the border region between Hungary and Ukraine. While this would undoubtedly help to improve the global food supply in the long term, Nagy also believes that support for such initiatives could come from the EU.
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Uncertainty in the Investment Markets
News | 5
invested in commercial real estate in 2021 originated in Hungary,” it adds. The office sector continues to be the most sought-after in Hungary,
constituting
73%
While international, regional, and domestic investors continue to show interest in the Hungarian and Central European investment markets, the current low level of activity reflects the geopolitical uncertainty in the region; a calm summer in the investment markets is expected.
of total investment activity for the second half of 2021, according to Cushman & Wakefield. Union Investment’s purchase of the Szervita Square Building and S Immo AG’s acquisition of BudaPart Gate indicate a strong performance for products at the top end of the market. However, industrial and retail recorded weak figures with 3% and 4% of market activity respectively, reflecting the lack of assets available in these sectors.
BudaPart Gate, developed by Property Market, bought by S Immo.
GARY J. MORRELL
Benjamin Perez Ellischewitz, principal at Avison Young Hungary, expects a total investment volume of around EUR 1.3 billion for the year against a background of uncertainty caused by the war in Ukraine, potentially high interest rates and price inflation on building costs. He anticipates a quiet summer as investors press the pause button and reconsider their strategy for later in the year. “Large assets of EUR 100 millionplus are not currently liquid in Hungary, and all the Central European markets are moving slowly,” he said. He argues that the investment volume
for
2021
ended significantly higher than initially expected at EUR 1.4 bln. ADVERTISEMENT
Avison Young has successfully mediated the disposal of two architecturally significant assets in Budapest’s Central Business District. Báthory Street 12 and the Herzog Villa at Andrássy út 93 are two fully leased single-tenanted office buildings in prime locations in the CBD. They have been locally managed by Teichmann & Companions since their acquisition in 2015. Investors are increasingly looking at value-add possibilities in earlier generation office stock and older historic buildings that require renovation. Gábor Borbély, head of business development and research at CBRE Hungary, has traced EUR 580 million in investment volume for the first half year and, taking into consideration the investment pipeline, expects EUR 1.2 bln for the whole year. Much depends on whether the
geopolitical situation improves, he says. Investors operating in Hungary remain cautious, according to Cushman & Wakefield.
Underlying Resilience
“Investment volumes in 2021 reached EUR 1.13 bln. Whilst 2020 and 2021 […] were down on recent years, they exceeded the EUR 1 bln mark, demonstrating underlying resilience to a challenging environment,” the consultancy comments. “International capital continues to be active in Hungary, and domestic sources of capital continue to hunt increasingly larger opportunities. Indeed, more than 40% of the capital
“International capital continues to be active in Hungary, and domestic sources of capital continue to hunt increasingly larger opportunities. Indeed, more than 40% of the capital invested in commercial real estate in 2021 originated in Hungary.” The purchase of the 18,000 sqm BudaPart Gate from Property Market by S Immo, with its head office in Vienna, was also an example of foreign capital acquiring prime Hungarian office stock. Domestic investors have continued to dominate market activity, despite increasing competition from international investors. Of the investment activity traced for 2021, domestic investors were responsible for 30%, while cross-border investment activity undertook 70%. The conventional wisdom is that, despite issues relating to the war in Ukraine and other economic factors impacting the commercial property market, a large amount of capital is still looking to be invested. Hungary and Central Europe remain attractive investment destinations that offer a yield spread and a range of assets appropriate for specific investor preferences.
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‘ESC’ Community and 2022 Atlas Award Launched A business community based on the principles of ethics, sustainability and creativity (ESC) has been launched in Budapest, along with the 2022 Atlas Award. Both are the brainchild of well-known Italian expat Alessandro Farina, founder of ITL Group. BBJ STAFF
The Atlas World Community was unveiled for the first time on July 7, at Aranybástya (Golden Bastian). This beautifully renovated Castle District restaurant and café stands on the site of what was once a Turkish fortification, and later a palace designed by the acclaimed architect Miklós Ybl and commissioned by Count Menyhért Lónyay (1822-84), who served as Prime Minister of Hungary (1871-72). “I come from an Italian family with a long entrepreneurial tradition. From a young age, I learned that entrepreneurs have a moral obligation to their predecessors and to future generations for building a better world,” says Farina of his inspiration for the award. “We call this moral obligation an ‘ESC approach.’ These are the values that
Atlas Award founder Alessandro Farina (left) and its creator, the artist Marco Veronese. Photo by Irene Pepe / ITL Group. inspired the foundation of Atlas World [community], whose projects we hope will inspire other people facing this era of lightning-fast change to make a positive impact on our society.” One such project, the Atlas Award was presented for the first time at the eighth Budapest Business Party in June 2019. It aims to reward those business leaders inspired by that ESC approach, whose companies are shaping a better world. Nominations for the 2022 award are open until September 18.
Two further Atlas World events are planned on September 6 and October 6, when the presentation of the inaugural Atlas Award will be made. You can learn more about the Atlas World Community and the award, and nominate prize candidates for the award, at atlasworld.hu. The inaugural event was supported by several members of the Atlas World Community: Silvia Merighi, founder of MSP Group, Omar Balducci, sales
“I come from an Italian family with a long entrepreneurial tradition. From a young age, I learned that entrepreneurs have a moral obligation to their predecessors and to future generations for building a better world. […] These are the values that inspired the foundation of Atlas World [Community], whose projects we hope will inspire other people facing this era of lightning-fast change to make a positive impact on our society.”
director for Central and Eastern Europe of Lucart Group and Lucart Kft. spokesman, and Bernardino Pusceddu, founder of Comagro Sardo. The Budapest Business Journal is a media sponsor.
Hybrid Creation
To create the prize, Farina turned to the Budapest-based Italian artist Marco Veronese, who produced a hybrid sculpture blending Atlas (the Titan of Greek mythology, who supports the world oh his shoulders) and the Vitruvian Man (the worldfamous drawing by Leonardo Da Vinci which combines harmony and beauty in the human body). Two precious gems shine in the work: a ruby in the heart of the man, and an emerald marking Hungary on the globe. Farina and Veronese unveiled the prize as the sun set on Aranybástya’s panaromic views over Parliament and the Pest embankment.
The inaugural Atlas World Community event at the Aranybástya, in the Castle District. Photo by Irene Pepe / ITL Group.
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News | 7
Hungary Ranked 13th in KPMG Net Zero Readiness Index “This situation could easily be transferred to the logistics sector, as it is attracting investors and buildings are less complex than offices, and therefore savings on energy are easier to achieve. In this way, branding through sustainability accreditation is an advantage, in addition to savings on energy consumption,” he adds.
Of the 32 countries featured, Hungary was placed just behind Spain and just ahead of the United States. Poland, the only other Central and Eastern European state included in the index, was placed in 19th spot. Artist’s rendering on the Well-certified Corvin Innovation Campus by Futureal.
GARY J. MORRELL
“Hungary has a net-zero target in place, and its financial sector is working to stimulate the flow of capital to decarbonization efforts. Much of its electricity is generated by nuclear power, and it is developing solar capacity, energy efficiency and use of electric vehicles,” said István Szabó, a senior manager at KPMG Hungary. Buildings currently represent 17% of emissions, agriculture land use and forestry 16%, industry 21%, transport 23%, and electricity and heating 23%, according to the Big Four consultancy. “The Net Zero Readiness Index (NZRI) is a tool that compares the progress of 32 countries in reducing the greenhouse gas emissions that cause climate change and assesses the preparedness and ability to achieve net zero emissions of these gases by 2050. I am optimistic with regard to real estate in Hungary due to the number of offices achieving BREEAM and LEED accreditation,” comments Pál Dános, head of real estate advisory and business at KPMG Hungary. Hungary’s government has accelerated work on carbon reduction over the last two years, according to Szabó.
Increasing use of WELL Accreditation
Ten office projects in Budapest are now WELL sustainability pre-certified, with documents submitted to the appropriate authorities. The accreditation is increasingly becoming the norm alongside BREEAM or LEED thirdparty sustainability accreditation. The two projects already certified are the Corvin Technology & Innovation Park by Futureal and the Nordic Light Trio by Skanska. Other projects would probably be able to attain the status, but there are problems with air quality around the buildings that impacts internal air quality, analysts say. Hungary
“It is one of the five countries that receive the highest score on contribution to global net zero, partly as a result of its June 2020 climate protection law that includes a 2050 net zero target. The government is trying to decarbonize transport through tax benefits and cash support for electric vehicles, and encouraging intermodal freight junctions for cities so that containers can be transported mostly by rail with road used for the last few kilometers,” he notes. “Regarding industry, a number of multinational manufacturers have large Hungarian factories, which are run to high environmental standards, and the country’s EU membership means all have to meet its standards. Domestically focused companies can potentially benefit from available EU funds and green lending products to make a smooth transition in the following years,” Szabó added.
Lowest Placed
In comparison, Poland stands 19th in the index; indeed, the country is currently the lowest placed EU member
also has specific issues with the lead content in its water, and it could take 15 years to rectify the situation.
Szervita Square Wins 2 World Gold FIABCI Prix D’Excellence Awards
The Szervita Square Building by Horizon Development, a Central Business District office development in Budapest, has won two World Gold FIABCI Prix D’Excellence Awards for Best Mixed-Use Development and Best Sustainable Development. According to Horizon, the 12,500 sqm project has received a LEED “Platinum”
state in the NZRI. This is partly because of its heavy use of coal, which is used to generate 52% of its electricity. “The country has not committed to a net-zero target and faces a huge challenge to shift away from coal, including softening the impact on mining areas. It has adopted an energy strategy to escalate the shift to renewables, including wind power,” KPMG comments. Further Hungarian optimism comes from the fact that as much as 47% of class “A” Budapest office stock, or 1.5 million sqm, is accredited by an independent third-party sustainability organization such as BREEAM or LEED, KPMG says. This is expected to rise to 50% relatively quickly, given the standard and size of the Budapest development pipeline. “It is not conceivable that a real estate fund would buy an office project that is not sustainability certified. Further, most new buildings are occupied by companies operating in the global market and therefore need to locate in sustainability classified buildings,” says Dános.
environmental rating, making it the first mixed-use property in CEE certified to this level. The complex is a rare highend office development in the historical center of Budapest with additional highend retail and residential space.
Benchmarking for EU Taxonomy Established
There is already an elaborated and standardized EU Taxonomy requirement list available for various business sectors that defines what is considered sustainable business activity within the European Union, says Zsombor Barta, president of the Hungarian Green
“It [Hungary] is one of the five countries that receive the highest score on contribution to global net zero, partly as a result of its June 2020 climate protection law that includes a 2050 net zero target. The government is trying to decarbonize transport through tax benefits and cash support for electric vehicles, and encouraging intermodal freight junctions for cities so that containers can be transported mostly by rail with road used for the last few kilometers.” The top five in the index are, in descending order, Norway, the United Kingdom, Sweden, Denmark, and Germany. More information on the NZRI can be found on the KPMG website. KPMG is increasing its dedicated environmental, social and governance staff as the consultancy strives to become an ESG partner to groups in all major sectors of the economy.
Building Council (HuGBC). This is a crucial step towards a more transparent and standardized benchmarking methodology within the union, especially as certain financial benefits are or will be connected to the taxonomy compliance conditions. “We are very proud and happy as the Hungarian Green Building Council collaborated with the National Bank of Hungary on the adaptation of the EU Taxonomy for the real estate sector in Hungary. Further, the HuGBC can also verify taxonomy compliance in this sector, which is, again, an important milestone related to the third-party verification of EU Taxonomy compliance.”
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Business
Hungarian Scientists win NASA Computer Model Challenge
Freelance data scientists and deep learning developers Axel Ország-Krisz and Richárd Ádám Vécsey, longtime friends and collaborators, won the top spot and USD 25,000 in the Aftershock: NASA Shock Propagation Challenge in midJuly. The Budapest Business Journal spoke with them about their solution and plans. BENCE GAÁL
BBJ: How did you become interested in space-related research? Axel Ország-Krisz & Richárd Ádám Vécsey: Every child wants to be an astronaut. In 2020, we had to decide about our free time due to COVID-19 lockdowns. We decided to move further and find challenges from our couch. This sounds
The Aftershock NASA Challenge The Aftershock challenge was run by the U.S. space agency, Freelancer.com, the world’s largest freelancing and crowdsourcing marketplace by the number of users and jobs posted, and government-focused consultancy LMI. It aimed to crowdsource novel prediction models to improve the agency’s ability to predict shock loads through spacecraft.
of a spacecraft, it is possible to place lightweight shock sensors on critical points of the structure. Based on the live data feed, our model can easily be retrained to provide a flexible and adaptive shock prediction system. One day, a model like this may be a standard part of safety systems and mechanisms on a spacecraft.
BBJ: How will your solution help NASA specifically, and how might it affect the future of space flight? AOK & RAV: Although the attributes of materials and joints are pretty assessable, tiny miscalculations can lead to significant errors. High computational capacity and deep learning can provide better models for shock propagation since, based on a few well-measured experiments, they can predict the probable shock propagation very well. Hopefully, in the not too distant future, it can be used in long-term deepspace flight. We think NASA will use our solution for developing nextgeneration satellites and spacecraft. We also submitted a white paper and additional development information to help NASA experts develop our Axel Ország-Krisz (left) and Richárd Ádám Vécsey. solution further if needed. We are open to NASA using our solution in new fields. We hope we have added simple, but that was not an easy decision. and trained by us. It uses 28 data something to the future exploration We are open and like to learn new things. points as inputs and predicts all shock and conquest of space. We began running hackathons, and we response spectrum (SRS) values ran into the Space Apps Challenge 2020 separately. The data points are, among organized by NASA, an annual challenge others, the strength and type of the “If we can reduce the mass for developers and space enthusiasts shock, the distance between the shock of a spacecraft, it is possible worldwide. We submitted a project that and the measurement point, the type took us to the global finalists. This of affected materials, the type and to place lightweight shock acknowledgment gave us a huge nudge. number of joints, and the requested sensors on critical points of We had a lot of hackathon experiences, but frequency. The model is surrounded NASA is a “different world.” It organized by several functions that clean and the structure. Based on the the event with absolute professionalism normalize the input data. The final live data feed, our model and enthusiasm and replied to our model is tiny, easy to run, and retrain messages even if we sent them at quite for the parameters of other satellites or can easily be retrained strange times. In our defense, managing devices. The inference can be managed to provide a flexible and time zone differences can be tricky! So, even in microcomputers. basically, the attitude and devotion of adaptive shock prediction NASA’s employees give us the last push BBJ: How can it be used in system. One day, to begin this journey in space-related a real-life situation? research. We really needed that to expand AOK & RAV: We think our software a model like this may be our focus areas from healthcare and will have a tangible impact on the a standard part of safety autonomous vehicles to space. aerospace industry since the different systems and mechanisms components of satellites or spacecraft BBJ: Your solution to NASA and their payloads may be damaged on a spacecraft.” proposed a deep learning model. by various frequencies of the shock How exactly does it work? spectrum. A shock can be from a AOK & RAV: The core of the software hit or an explosion. Both types of is a deep learning model engineered shock can happen during the launch BBJ: What is next for you after and separation phases or during the winning the challenge? space mission. High frequencies can AOK & RAV: Our deep learning model harm the electronics, while lower can be retained for new purposes like Contestants from around the frequencies can damage structural different structures or restructured based world were given four months to components. With the help of the on the same concept, like handling a complete their entry providing a solution, spacecraft components can new type of joint mechanisms or new new model for shock propagation. be engineered more appropriately materials. Those processes are easy for The challenge received a total according to the expected shock us since we made the model and deeply of 49 submissions. Of those, four response. More properly engineered understand it. We can save a lot of time solutions were awarded a share of devices lead to prolonged operation and hard work for engineers if they ask USD 50,000. or less weight. Both results have a for our help. So, we are waiting for a This is the second NASA/Freelancer. positive effect on the use of resources phone call or the notification beep for an com/LMI challenge Axel Országsince, during a launch, every gram incoming email from NASA. The concept Krisz and Richárd Ádám Vécsey have counts, and a longer functioning of our idea can be used in different areas won, having picked up USD 10,000 device needs replacing less often, or industries. We are seeking challenges in the NASA Risky Space Business which again means savings. in our daily life, so we are looking both for Challenge back in May of this year. There are other possibilities in the new business possibilities on the market long term. If we can reduce the mass and new challenges on freelancer.com.
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Budapest Business Journal | July 29 – September 8, 2022
Household and hygiene paper maker Vajda-Papír Kft. has expanded its production facilities in Dunaföldvár (about 95 km south of Budapest by road) with the addition of a second mill, a 15-month investment worth HUF 16 billion. Inaugurated by Minister of Finance Mihály Varga on July 19, almost HUF 10 bln of the total budget was spent on machinery and technology investments, including acquiring a “world-class” base paper machine.
INSIDE VIEW
Hotel Industry Experiencing Headwinds, but Fundamentals Support Stakeholders Márton Takács
Global Leader: Hotel and Leisure
BBJ STAFF
The extension of what the company claims is one of the world’s most modern hygiene paper mills includes a new base paper production hall and warehouse, plus pulp storage and preparation areas. The project is an addition to the facility completed in Dunaföldvár in November 2018. That first phase had already created what the company called the largest modern paper mill in the region at a cost of HUF 15 bln. Speaking at the ceremony, Varga praised the fact that Hungary has become selfsufficient in the supply of base paper for the production of sanitary paper products. Vajda-Papír’s investment will create 50 new jobs while maintaining the existing 600.
Priority Investment
The Hungarian government classified the development as a priority investment in the national economy and granted it HUF 5.5 bln in non-refundable aid under the Large Enterprise Investment Support Program. The 2018 phase had been
Vajda-Papír Figures
The paper machine hall, the associated paper bale storage, and the pulp and base paper warehouses together occupy an area of about two soccer pitches, with the roads built to support them taking up two more, Attila Vajda, managing director of Vajda-Papír says of the project. The 66-meter-long paper machine weighs more than 1,044 tonnes, “the equivalent of 40 elephants.” It can produce 10 tonnes of base paper rolls per hour and 80,000 tonnes per year. Water from the paper production process will be biologically purified to a level “that can be accepted by nature” and directly returned to the Danube River. Some 50% of that is filtered
similarly classified and was granted HUF 4.5 bln in non-refundable funding. Varga noted that the Vajda-Papír Group produces about 55% of all the household and hygiene paper products in Hungary; its products account for almost three-quarters of such exports. Attila Vajda, managing director of Vajda-Papír, commented that the group is not only able to ensure Hungary’s selfsufficiency in hygiene paper products but can now also meet its own needs for base paper. He added that there were already plans for further expansion. “The investment […] will reduce the environmental impact of our production and, by eliminating the transport of base paper, we will also significantly reduce our ecological footprint,” Vajda said. The expansion will double the production capacity of tissue paper products and triple its base paper production capacity, from 35,000 tonnes to 115,000 tonnes, significantly improving the company’s ability to expand its foreign markets. The company was “building an entrepreneurial dream, a true success story,” Vajda added.
once again to achieve the purity of well water and is reused in the papermaking process. Vajda-Papír was founded 22 years ago as a family business. The group entered the Norwegian market in 2013 and has been operating a factory there for 10 years, employing more than 130 people. In addition to sales in Hungary, the company’s Ooops! brand and private label toilet tissue, paper handkerchiefs, paper towels, and paper napkins are supplied to Scandinavia, the Baltic States, Central and Eastern Europe, and more than 30 countries around the world. The group recorded a 10% increase in turnover in 2021, with sales rising from HUF 52 bln to HUF 57 bln.
Managing Partner
MOORE GLOBAL
Head of Hotel & Tourism Advisory MOORE HUNGARY
Attila Vajda of Vajda-Papír (center) explains the new paper machine to Mihály Varga (right).
dr. Márton Kovács
The travel industry faces an uncertain summer season for the third year in a row as the economic ripples of the war in Ukraine are amplified by cumbersome international air travel, canceled flights, and lost baggage experiences, putting both travelers and service providers to the test. Surprisingly, the level of travel demand in some places is at or exceeding 2019 (pre-pandemic) figures. European hotel performance indicators show that, whilst the world-average hotel room occupancy was 54.2% in the first five months of this year, European hotels still averaged slightly below that (53.8%). However, the recent abolition of European covidrelated travel restrictions has started a full-throttle release of pent-up demand, quickly moving the continent up the chart. It became the best-performing region in the world in May, with a realized total hotel occupancy average of 70%. It is anticipated that this European rebound will last through this year. Hungarian hotels seem likely to follow suit; besides unprecedented seasonal occupancy in top summer destinations, hotels also seem to be capitalizing on the inflationary environment. Compared to May 2019, average hotel room rates were 22% higher nationally, 13% higher in Budapest, and, significantly, 28% higher in the Balaton region in May. That growth is anticipated to soar further in the summer months. “Top Hungarian leisure destinations enjoy the strong realized demand, and price levels seem to keep up with inflation, largely balancing rising cost levels,” says Marton Takacs, hotel and leisure sector leader for Moore Global and head of hotel and tourism advisory at Moore Hungary. “There is no definite answer as to how far along Hungarian domestic travelers will be able to keep up with the price increases, but we do see a very strong desire to go on vacation after the pandemic, and people seem to be willing to allocate more of their discretionary income to cover the rising costs,” he notes. “Despite the turbulence and potential short-term strained financial performance, we believe that the fundamentals continue to support the market stakeholders’ optimistic longer-term
MOORE LEGAL HUNGARY
outlook. This goes for operators and hotel real estate developers,” Takacs adds. Despite the challenges, two years of COVID improvisation, innovation, and reinvention mean many businesses can better survive the continuing turmoil. Measures introduced in haste when the pandemic struck are now proving to be beneficial to operational efficiency and financial sustainability and are already becoming the “new normal.” Russia’s actions in Ukraine have created new risks, not least an oil price spike which has pushed up fuel costs. Still, the United Nations World Travel Organization is sticking to its prediction that international tourist arrivals globally in 2022 will be 30-78% higher than in 2021. Many measures which would once have been considered inappropriate by most hoteliers became necessities during the pandemic to help hotels stay afloat. Rooms were not cleaned every day and check-in went online. Restaurant menu options were accessed via a QR code on a smartphone and reduced to compensate for the fact that most properties were running on skeleton staffing to preserve cash. Individually, they may seem inconsequential, but as a package, they significantly impact business sustainability. What is more, customers did not seem to mind, encouraging hoteliers to go further. Moore Hungary’s hotel and leisure experts predict several emerging trends will gain real momentum and soon become standard operating procedures for hotel groups in Hungary as well. For many businesses, one of the biggest obstacles to a return to normal is the lack of staff. There are expected to be around 60 million job vacancies globally in the hotel industry this year, and the majority of those hourly-paid jobs will probably remain unfilled as millions of low-paid staff have moved on to other sectors, retrained, or left the employment market entirely. Moore Global Network member firms have established track records of providing business advice to hotel, leisure and tourism owners and operators. No matter what area of the hotel and leisure industry you operate in, our understanding of the key market drivers provides clients with the necessary advice to add value and gain a competitive edge.
www.mooreglobal.hu
NOTE: ALL ARTICLES MARKED INSIDE VIEW ARE PAID PROMOTIONAL CONTENT FOR WHICH THE BUDAPEST BUSINESS JOURNAL DOES NOT TAKE RESPONSIBILITY
Fin. Min. Mihály Varga Inaugurates Vajda-Papír’s Dunaföldvár Mill
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Budapest Business Journal | July 29 – September 8, 2022
Demographics and Gross Domestic Product Corporate finance columnist Les Nemethy makes the case for why demographics and economics are fundamentally linked. Many believe that demographics is, at most, remotely related to economics. If you are one of these, perhaps by the time you finish reading this article, you will be convinced how fundamentally demographics underpin economics. Let’s start with GDP. GDP equals the number of staff in the workforce multiplied by productivity. If the population of certain countries (for example, Russia and China) is expected to decrease by 30-40% over the next 30 years, which is indeed the expectation, unless there is a productivity miracle, their GDP will constitute a smaller share of global GDP. In Russia, urbanization happened somewhat earlier than in China. People living in overcrowded apartments tend to have fewer children than when those children provide free labor on farms. In China, the demographic implosion was accelerated by the government’s “one child” policy. Severe sanctions were imposed on families with more than one child. Estimates range as high as 200 million as the number of infant girls killed so that the family could have another chance at having a son. This inhibits family formation. In Russia, the current demographic implosion is further accelerated by men dying in their prime in Ukraine and massive emigration since the start of the war. The United States enjoys much healthier demographics: baby boomers, for whatever reason, had more children than in Russia or China.
Retirement Transition
As mentioned, demographics deals not only with population numbers but also the breakdown of the population
Hungary 2019* Population: 9,684,679
The Corporate Finance Column Poland 2019* Population: 37,887,771
*Population pyramid (% of population)
according to age cohorts. Over the next few years, a large number of baby boomers will transition from the workforce into retirement all over the world. While there is a graying population in the United States, the trend is far more pronounced in China and Russia. Given that 25-65-year-olds provide the bulk of the workforce, in the unlikely event that birthrates could be encouraged to say double, it would take 25 years for newly borns to enter the workforce, let alone reach peak productivity. There is no instant solution. One might surmise that the relative GDP numbers of Russia and China are peaking at present vis-à-vis the United States. Russia’s GDP (USD 1.775 trillion) is much smaller than most people realize; indeed, it is less than that of Canada (USD 1.991 tln; both sets of figures are 2021 numbers). Russia packs a punch above its economic weight thanks to its stock of nuclear weapons and a strategic position concerning commodities, most notably oil and gas. However, as Russia’s GDP declines in relative terms due to demographics, its nuclear arsenal becomes more obsolete, energy stocks become depleted, and the world turns away from hydrocarbons, their influence in the world may well decline. The start of the Ukrainian War may well
Czech Republic 2019* Population: 10,689,213
Source: PopulationPyramid.net
propels GDP growth). After that age, the emphasis is on savings (for retirement). Of course, one of the most significant aspects of aging populations is the increasing ratio of the elderly, who must be supported (pension, medical, etc.), to workers. In Europe, for example, the proportion of pensioners to workers is expected to rise to 71% by 2060. There is no short-term solution. If we were to change tax policies, housing availability, etc., today, in 25 years, we could see the pensioner-to-worker ratio improve. The other solution would be to encourage everything that promotes productivity (automation, etc.). For example, Japan, facing a significant problem with an aging population, is using digitization to compensate for the lack of labor. Central European Implosion In my September article, I intend to build on Where does Central Europe stand this article and discuss how demographics concerning demographics? Unfortunately, are also fundamental to finance: performance as the following population pyramids of financial markets, cost of capital, etc. demonstrate, they are trending towards imploding as well. The situation does not look that Les Nemethy is CEO of Euro-Phoenix Financial healthy for Central Europe; in fact, over Advisers Ltd. (www.europhoenix.com), a the past decade or so, births have been Central European corporate finance firm. He even fewer than in Russia or China. is a former World Banker, author of Business Until age 40-45, wage earners are Exit Planning (www.businessexitplanningbook. primarily spending their earnings (having com), and a previous president of the children, making a household, etc.; this American Chamber of Commerce in Hungary. triggers consumer spending, which mark “Peak Russia.” In my opinion, it is “all downhill” from here. Perhaps that is why Vladimir Putin thinks it’s now or never that Russia must exercise its muscle to maintain its geopolitical prominence. With China, the situation is much more subtle, given that its population is triple that of the United States, its GDP is already larger than America’s on a Purchasing Power Parity basis, and the Chinese are so much more of a force in technology than the Russians. Yet, here as well, a demographic implosion is preordained and irreversible. If China’s population goes down by 30-40%, and the U.S. population goes up by 15-20% by 2050, it is likely that Chinese GDP relative to the States will also shrink.
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Budapest Business Journal | July 29 – September 8, 2022
Country Focus Korea
PRESENTED CONTENT
Thinking Big: South Korean Investments in Hungary South Korea is the fifth largest investor in the country, and its activity in the EV segment, in particular, could propel Hungary to become a European powerhouse in this rapidly growing area. Projects guided by the Hungarian Investment Promotion Agency provide an in-depth look into what is behind the phenomenon. BBJ STAFF
2021 presented a case of déja vu in Hungary’s FDI statistics since, like 2019, South Korea, of all foreign investors, again generated the most investment volume and announced it would create the most jobs. The Asian country has tended to be among the top three since 2018 in terms of critical investment figures, including the number of deals closed. There is a fair chance that it will finish in a similar position this year as well. Considering this level of activity, it is hardly surprising that the largest greenfield investment project of all time in Hungary is also associated with a South Korean company, namely SK On, which revealed last year plans to set up a 30 GWh battery factory in Iváncsa (50 km south of Budapest by road) for EUR 1.9 billion as part of its local expansion. SK On already has two plants in Komárom (90 km northwest of the capital); its total announced investments in Hungary are now
Advancing Technology
More than 20 locations in the country now host Asian investors in the EV segment. Since 2016, 43 related deals worth EUR 7.9 bln were closed by HIPA, the bulk of them with South Korean companies.
Vital Position
Hungary is building out a vital position due to the rapid expansion of its EV manufacturing ecosystem; it now has the world’s third largest e-battery capacity, with the current 50 GWh to grow to 150 GWh by 2025. This is badly needed, as European demand for lithium-ion cells in 2030 will be 10-15 times higher than the production volume on the continent in 2020, according to a research paper by IPCEI Batteries, an EU-level Integrated Project. If all goes well, though, Europe’s battery production volume can jump from its current global share of 15% to up to 28-43% by the end of the decade.
HIPA-guided South Korean projects (2014-2022 H1) Number of deals closed
46
Total investment volume
EUR 7.9 bln
Number of new jobs
13,000-plus Source: HIPA, KOTRA
close to
EUR 3 bln.
All these projects are accelerating the process of creating a robust EV ecosystem in the Hungarian economy. Apart from SK On, another battery manufacturer, Samsung SDI, is also present here, and South Korean supplier firms have set up shop one after another. Take just the most recent deals: Lotte Aluminium will manufacture aluminum anode foils (investment volume: EUR 133 million), EcoPro BM will produce cathode materials (EUR 728 mln), and Nice LMS plans to make battery cases (EUR 14.4 mln).
It is worth remembering that battery cells represent approximately 40% of the value added in producing an electric vehicle. So it is no wonder that production capacities for lithium-ion batteries are growing faster in Europe than in any other region of the world. As experts point out, technical advances, favorable political conditions, and a promising sales market have created a perfect storm to give the ultimate push to large-scale battery production on the continent. Recent EU legislation is designed to speed things up even further.
Another factor shaping the industry is constant technological development. Solid state batteries (SSB) promise superior energy density, which raises the question of how market players specialized in lithiumion batteries (LIB) will need to adapt. SK On is working on development of nextgeneration batteries such as SSB and lithium metal batteries (LMB) to improve the current lithium-ion batteries, Du-Hong Kim explains. The SK On plant in Komárom. “We believe our SSB and LMB developments will provide ultimate safety, reduced charging time, and dramatically increased driving The Commission’s “Fit for 55” climate distance for LIB-based electric vehicles,” he package aims to cut greenhouse gas says. The driving range will also be boosted emissions of new passenger autos by by the development of a new generation of at least separators for solid electrolytes in particular. Kyung-Hwan Ko, of W-Scope, stresses that SSB is still under development. Even if the by 2030 compared to 2021. Its proposal technology is commercialized, it is expected that only zero-emission vehicles should to co-exist with LIBs for a considerable period. be sold within the single market from 2035 was adopted by the European Parliament earlier in June. South Korean Kyung-Hwan Ko, managing director of W-Scope Hungary Plant Kft., interprets this Investor Community new legislation positively; the company has in Hungary recently announced it will build a separator Number film plant for EUR 720 mln in Nyíregyháza 260-plus of businesses (240 km northeast of Budapest). Number “In line with this market acceleration, 20,000-plus of employed we believe that our investment in Share of total Hungary was implemented in a timely 5.5% FDI stock manner,” he says. “In addition, due Source: HIPA, KOTRA to this EU decision, we are internally reviewing whether to advance our additional investment plan ahead of the planned period. We have decided to “We are in the process of developing new invest in Hungary upon faith in Europe, products such as polymer electrolytes and which is leading the EV market, and we ion exchange membranes that can be applied believe that W-Scope Hungary Plant will to various business areas,” he concludes. take an important position for our future.” All the related investments and research Active European policy was also among will surely come in handy since IPCEI the decisive factors for SK On when Batteries’ progressive scenario projects that determining the location of its plants. The company believes the EU’s objectives are likely to be achievable. Du-Hong Kim, of passenger cars in Europe will be battery the head of SK On’s Europe Business electric vehicles by 2030, which presupposes Management Unit, says its investments the availability of vast battery cell capacities. will make Hungary “one of the largest Hungary’s thriving EV ecosystem holds the countries supplying electric vehicle promise that this country will play a key batteries in Europe” and will “contribute role in meeting that demand, and to a great positively to the development of the degree, thanks to South Korean investors. battery supply chain in Hungary.”
55%
81%
Hungarian-South Korean Economic Relations (in billions of USD, 2021) 4,2
up 7.2% y-o-y
Exports
0,6
up 24.7% y-o-y
Bilateral Trade*
4,8
up 9.1% y-o-y
Imports
*Exports plus imports
Source: HIPA, KOTRA
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Focus
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Budapest Business Journal | July 29 – September 8, 2022
Preparing for the 3rd Generation of Korean Investment BBJ: In 2019 we had the Hableány cruise boat disaster, when 28 people died, including 26 Korean tourists. One body is still missing. What impact has that had on bilateral relations? CP: At that time, I was the Presidential Secretary for Foreign Affairs and Trade at the Blue House, the Presidential Office [in Seoul]. I was summoned by the chairman of the National Security Council, and with the other, high-level people [the question was] how to deal with this? The decision was we had to send our technical people, soldiers, divers, and as soon as possible, meaning tomorrow. But tomorrow is difficult to find the tickets, right? The answer was that we Ambassador Chulmin Park presents his credentials to would send our military aeroplanes. But the then President of Hungary János Áder on Jan. 20, 2021. we were worried about this, how would Photo by the Office of the President of the Republic. the Hungarian government respond, it’s a sovereign country. But [the response] was a very warm-hearted embrace of all Trade-Investment Promotion Agency. year later, and the third was Hankook Tire. of us. And the cooperation was fantastic. In Budapest, KOTRA has a separate They invested here in 2005 or so. We really appreciated this, it was not just building, with 10 people. And we have Now, more recently, there is a second lip-service, or a display of sentiment. the Korean Chamber of Commerce generation, with a huge amount of As the commemoration day comes, in Budapest. There is very powerful investment in the field of electric car I witnessed this, how much devoted this investment, with more looking to come. batteries, [including] Samsung SDI and government is. We also have the Korean Cultural Center. SK On. In 2019, for the year, we ranked In Lisbon, I had no organization like that. as the largest investment country in BBJ: What about tourism? Hungary. In 2020, according to the CP: In 2018, the number was approximately BBJ: Do those 6,000 Koreans mainly authority here, China was number 200,000. We thought it would go up, KESTER EDDY live in Budapest? one, and then, last year, we got the but [after the Hableány tragedy], people CP: I think so, 60-70%. Most of the championship again. It was SK On; were worried. This area [was perceived] BBJ: Relations between Hungary and Korean-established companies are they announced a new investment, as very risky and dangerous, that’s why Korea have come a long way since based in Budapest and nearby, but EUR 2.1 bln. This year, we should the numbers just stopped. 1989. What do you see as the main now we have [plants] in Komárom definitely remain the largest investor But, as COVID recedes, I’m expecting developments? and Debrecen, and coming in Iváncsa country in Hungary. many Koreans will come. Even during H.E. Chulmin Park: I used to be the [30 km south of Budapest]. There are three companies this year: the pandemic, LOT, the Polish airline, director general of European Affairs the first is W-Scope, with their battery operated once a week [between Seoul [in Seoul] from 2015-16. At that time, separator manufacturing plant. The and Budapest]. and very recently they 55 countries were in my portfolio, second is EcoPro BM, that is another extended to two per week. And we can see including Hungary, which was a approximately USD 1 bln investment, the Korean Airlines flying between the two major country in the context of the and the third is LG Energy Solution [in capitals by the end of spring next year. V4 [Visegrad 4]. But seven years a joint venture] with Toray of Japan. ago, the number one was definitely It’s amazing. Mr. [Minister of Foreign BBJ: What do you feel you have Poland, followed by Czech [Republic] Affairs and Trade Péter] Szijjártó is very achieved here? and Slovakia and Hungary. active. He is the person who persuades CP: I have just passed the half-way In terms of investment size and [these companies] to come here. point [of a three-year posting] and scale, as well as in terms of people, We are now looking at thirdI have already accomplished three big the Korean community as well as generation investors, in biotechnology, things. The first was the visit of my the number of Korean companies, R&D and cosmetics. President [Jae-in Moon], this was the it was of relatively low standing most important thing, last November. [compared to] the other countries. BBJ: I read an article that mentioned The second was the first Korean Day But, I came here, and was suddenly the Korean Cultural Center was in Budapest, on May 21, Altogether, surprised. Wow! It’s a wonderful number! the largest such center anywhere, 10,000 Hungarian people attended. Investments are growing, and now the except for Tokyo. I was shocked. My plan is that this will continue [as H.E. Chulmin Park Is this under your remit? Korean community has reached 6,000 an annual event]. And the third is that people. That is the fourth in all Europe! CP: Yes, I’m in control. The lady director I earned the budget to enlarge the embassy I can’’t remember the exact order, Germany, joined me three months after I started here. There is more in the pipeline. U.K. and France [have larger Korean Students are a big proportion of here. Even during the pandemic period, communities], but Hungary is fourth! our community, altogether 800, many she organized cultural programs online. The trade volume is growing at 20% medical students at the Semmelweis She’s very active. We have 33 cultural each year, regardless of the pandemic. University in Budapest, and in Szeged, centers, but in my assessment, this is From Busan to Budapest Last year, it was USD 4.8 billion. Pecs and Debrecen. number one, and I’ve been to Japan and Chulmin Park was born and This displays how strong the bi-lateral New York. We moved into the building raised in the southern port city relations are now […] and that’s why BBJ: Have you got investment figures? in 2019, but were hit by the pandemic. of Busan, Republic of Korea. He I am, personally, treated very well by CP: Figures from the authority here Now, we have no restrictions, and at this moved to Seoul to study for his government officials and business leaders. and from Korea are different, but based point they have implemented around 73 bachelor’s degree and then to on my calculations, investment is programs, with 1,300 some participants Florida, in the United States, BBJ: But you have more than just USD 10 billion. In December last year, every week. for his masters in international the embassy here, you have the there were 270 Korean companies relations. His diplomatic Korean Cultural Center, don’t you? registered in our data, but this includes BBJ: And that’s a mixture of career includes stints in the CP: I have very strong infrastructure self-employed, one-man companies. Hungarians and Koreans? Netherlands, Brunei, Moscow, [here], in comparison with my previous The first generation of companies CP: No, Hungarians. They are the New York and Portugal. embassy in Lisbon, from 2016 – 2019. In here was in 1988-89, that was Samsung main target. The Koreans are a small Lisbon there was no KOTRA, the Korea Electronics, followed by Samsung SDI, one portion. It’s a great success!
Chulmin Park is the 19th ambassador of South Korea since Budapest and Seoul established diplomatic relations in 1989. Though accepted as “normal” today, at the time, this was a brave, pioneering move by Hungary, then a Warsaw Pact country. The Budapest Business Journal spoke with the diplomat about the state of bilateral relations.
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in Brief
Capital Investment up 58% Last Year European working capital investments picked up last year, with Hungary seeing a 58% increase compared to the previous year, according to EY, writes profitline.hu. Based on a survey by the international consulting company, 64% of investors expect that more investments will arrive in Europe in the next three years, and 53% wish to strengthen their presence on the continent. Domestically, vehicle manufacturing, software and IT services, and electronics are the most popular investment areas, while the majority of investors came from South Korea, Germany, the United States, and Austria.
Volta Takes out USD 200 mln Green Loan With Raiffeisen Bank South Korean-owned Volta Energy Solutions Hungary signed an agreement to take out a USD 200 million five-year syndicated green loan with a consortium led by Raiffeisen Bank, the parties announced on June 23, according to portfolio.hu. They said the loan would finance production capacity expansion in Hungary. Volta Energy Solutions Hungary is the only company in Europe that makes ultrathin battery copper foil for electric vehicles. With the financing, Volta will be able to complete
Nice LMS Building HUF 5.2 bln Plant in Vác
the second phase of its investment in Környe (60 km west of Budapest) and boost its annual output from 15,000 tonnes to 38,000 tonnes. The banking consortium led by Raiffeisen Bank includes CIB Bank, K&H Bank, UniCredit Bank Hungary, and the London- and Frankfurtbased units of Woori Bank. Volta is part of Korea’s Solus Advanced Materials, a global leader in battery copper foil manufacturing.
South Korean company Nice LMS will build a HUF 5.2 billion plant in Vác (35 km north of Budapest) to make batteries for electric vehicles, Minister of Foreign Affairs and Trade Péter Szijjártó said on July 7, according to origo.hu. The greenfield investment, which will create 60 jobs, is supported by a HUF 467 million government grant. The plant will
Minister of Foreign Affairs and Trade Péter Szijjártó (right) and Park Chang Sik, CEO of Nice LMS Hungary Kft., followed by Bence Rétvári, Parliamentary State Secretary of the Ministry of Interior and KDNP MP for Vác, at the press conference announcing the investment on July 7, 2022. Photo by Tamás Kovács / MTI.
S. Korean Ambassador Pays Courtesy Visit to MNB Governor South Korea’s Ambassador to Hungary Chulmin Park visited National Bank of Hungary (MNB) governor György Matolcsy on July 5, the central bank said in a release on its website. Matolcsy informed the ambassador of the “dynamically developing” ties between the Hungarian and South Korean central banks, as well as plans for cooperation in the future. “The MNB will continue to make efforts in the future to further develop and bring closer ties between the two central banks and the two countries,” the MNB said, adding that there are plans for several joint projects with the Bank of Korea in the coming period. The MNB noted that it issued a commemorative coin and organized a conference with the Bank of Korea in 2019 to mark the 30th anniversary of establishing diplomatic ties between the countries.
be the company’s first in Europe. It already has bases in Vietnam and China, in addition to South Korea. Szijjártó noted that Hungary has the third-largest EV battery production capacity in the world, which will increase from 50 GWh per year now to 150 GWh by 2025. He added that Hungary takes fifth place globally in EV battery exports.
Korea Guest of Honor at Festival of Crafts The 36th Festival of Crafts, the country’s largest folk art celebration, will run from August 19-21 at Buda Castle, according to profitline.hu. The guest country of honor this year will be South Korea, while the central theme will be crafts related to
woodwork, the organizers explained. The festival will feature around 1,000 domestic and foreign artisans. It will be possible to admire and buy folk handicrafts, of course, but through the nearly 100 visual workshops, visitors can also learn about the mysteries of ancient trades and get a glimpse of the work of artisan communities in the Carpathian Basin.
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Special Report Logistics
Boom in Budapest Industrial and Logistics Market The boom in the logistics and industrial sector is continuing unabated, as demand remains high and vacancy stands at a record low. Analysts see the market in Hungary and Central Europe as being in a favorable postcoronavirus position given the growth in e-commerce and light industrial production in major regional hubs, albeit with significant geopolitical and economic concerns. GARY J. MORRELL
In the current high demand, low vacancy climate, most developers are constructing built-to-suit facilities with an additional speculative element. Others, however, are prepared to build “on spec,” seeing little current risk in the strategy. Established regional industrial/ logistical developers and park operators, such as Prologis, CTP, and VGP, are active in the market, alongside national operators such as Infopark, the National Industrial Park Operator and Developer (NIPÜF), Wing, HelloParks and ConvergenCE. Most recently, the leading regional developer and park operator Panattoni joined this increasingly active market sector. This reflects the view that the logistics sector has undergone structural changes concerning demand and the need for more efficient delivery systems. Development activity is also extending to regional logistics hubs outside the M0 motorway and
Hungary and the establishment of the Samsung SDI factory. Most of our tenants are suppliers to SDI,” he explains. “There was so much demand that we could increase rental levels, and now we are at EUR 5.2 per sqm per month headline rent levels. I think this is the prime in Hungary. In the eastern region, at Maglód, our first 45,000 sqm storage building handed over this year is almost fully occupied. We have started construction of a second, 45,000 sqm building and already have preleases. In general, when we hand over a building, we have 50% occupancy and within six months lease the remaining space,” Nemes adds.
Low Supply
the Greater Budapest area, as has long been the development model elsewhere in Central Europe. Industrial demand for 2021 reached around 630,000 sqm, representing a
15% increase
on the previous year and a vacancy rate of about 4%, according to Cushman & Wakefield. Further, 2021 was a record year with net absorption of 320,000 sqm. In all, 13 new industrial buildings were delivered to the Greater Budapest market last year. The consultancy has traced 340,000 of space planned for delivery in 2022 in Greater Budapest, with a further 88,000 sqm already scheduled for 2023. “Both the significant amount of new supply arriving to the market and the high proportion of pre-lease transactions in the take-up demonstrate the continued developer and tenant appeal of the market,” said Cushman.
Small Stock
The total modern industrial/logistics stock in the Budapest area stands at about 2.8 million sqm, according to the Budapest Research Forum (consisting of CBRE, Colliers International, Cushman & Wakefield, Eston International, JLL, and Robertson Hungary). This is a relatively small stock by Central European standards. There are few, if any, existing logistics buildings with more than 5,000 sqm of available contiguous industrial space and an overall vacancy rate of around 4%. The consultancy has traced around 1.3 million sqm of stock in the
The industrial sector sees investors battling over a low supply of assets. Airport City logistics center by CPI. In a recent logistics transaction, the developer and investor Wing purchased the Airport City Logistics Park, located in the neighborhood of Hungarian regions, resulting in a Budapest Liszt Ferenc International total country-wide industrial stock of Airport, from CPI. The business 4.12 million sqm. Leasing activity has park contains almost 44,000 sqm of further accelerated, demonstrating the warehouse buildings and 8,0000 sqm continuing positive market sentiment. of offices in six functioning buildings, Although Hungary is seeing growth with one other under construction. in its seven regions, 57% of 2021 Regional industrial park completions were in Central Hungary developers and operators are the (which comprises Budapest and the biggest owners of industrial stock in surrounding Pest County), according Hungary. With its new Prologis Sziget to CBRE. II development, Prologis has a pipeline HelloParks, a member of the Hungarian Futureal Group, is developing of 50,000 sqm of space in Hungary for the year. With Hungary regarded as its eponymously-named logistics lacking a robust secondary industrial network across Hungary (and possibly market in the regions, the developer further afield into the CEE region in is concentrating its development time). HelloParks Maglód is under strategy in the M0 area around construction on a Greater Budapest. The company has a 630,000 sqm site portfolio in Hungary. Prologis is located near Budapest. The EUR 40 developing around 80% of its space million industrial and logistics center on a BTS basis, with the remaining has the capacity for a total area of 20% speculative. Over the past year, 193,000 sqm of BREEAM-accredited this speculative space has let very space. quickly. In general, projects have a “When we entered the market in delivery time of 10-12 months from 2000, Hungary was not competitive permitting to completion, according in terms of pricing. In general, to Zsuzsanna Hunyadi, director of the market was very different from leasing and customer experience at what we see today. When we started Prologis Hungary. to develop our first buildings, we The leading European and CEE realized that demand for space was industrial park operator and developer much bigger than we had anticipated,” Panattoni has secured two 100,000 sqm comments Rudolf Nemes, managing sites in the Budapest area. It had been director of the company. a notable absence in the Hungarian “For example, with our Fót 1 project, market in recent years. The company nobody really believed in this area to has undertaken construction of its the north of Budapest, and the net first 17,300 sqm warehouse at take-up was low. I think the game Törökbálint. Panattoni Park Budapest changer in this market segment was West is due to be completed in the the improvement in the north of first quarter of 2023.
46-hectare
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Sustainability Accreditation the Logical Choice for Logistics Industrial developers and park operators are building more highly-specified, sustainabilityaccredited projects in response to changing tenant demands and regulations reflecting growing climate and environmental concerns. GARY J. MORRELL
Several park developers and operators are seeking sustainability accreditation from a third-party specialist such as BREEAM, LEED or WELL across their entire portfolios. Tenants are looking to save on utility costs and reduce their carbon footprint. In this sense, similarities can be seen with office development and the need to adhere to environmental requirements and produce sustainable, well-designed, and highly-specified products in response to investor and tenant demands. Prologis, Inc., the real estate investment trust headquartered in San Francisco, California, is developing in accordance with at least BREEAM “Very Good” accreditation for its entire regional portfolio in the Czech Republic, Hungary, Poland and Slovakia.
Huge Opportunity
“We entered the Hungarian market because we see a huge opportunity to tap into the rising demand for modern, sustainable distribution centers,” says László Kemenes, head of Panattoni Hungary. “With this development, we are focusing on occupiers seeking highquality spaces in smaller-sized lots located very close to the city. Panattoni Park Budapest City West’s superior green credentials and exceptionally good location for transport connections will attract urban logistics operators targeting the large catchment area of this part of Central Europe,” he adds. HelloParks, the industrial and logistics real estate development company of the Futureal Group, has 45,000 sqm of BREEAM accredited space under construction at HelloParks Maglód. The center has the capacity for a total
area of
HelloParks Maglód, close to Budapest. Tenants recognize the importance of staff wellbeing, green areas, good locations, changing facilities for cyclists and electric charging units. There is also a need to observe precautions following the coronavirus pandemic and to reduce the carbon footprint, according to the company. “We have been following our crisis-proof strategy to be present and develop in key markets, but we are not only developers but also long-term owners and managers of our properties,” comments Zsuzsanna Hunyadi, leasing director at Prologis Hungary. “Our industrial real estate expertise spans real estate operations, development services and sustainable development. We are taking care of our customers’ needs, their growth, and the local communities. Customer satisfaction has always been a top priority for us, to offer more than just a warehouse building,” she adds.
Lower Utility Costs
Prologis Park Budapest-Harbor, for example, provides a 30% reduction in heating costs, LED lighting and large skylights cut electricity consumption by 45%, electric car charging facilities, and direct public transport links, according to the company.
Sustainability accreditation from independent, third-party sustainability organizations such as the U.K.-based BREEAM or U.S.-based LEED, and increasingly WELL, is now the norm for the entire development cycle of an office project from concept to design to leasing to property management and finally, an exit strategy. “This situation could easily be transferred to the logistics sector, as it is attracting investors and its buildings are less complex than offices, and therefore savings on energy are easier to achieve. In this way, branding through sustainability accreditation is an advantage in addition to savings on energy consumption,” said Pál Dános, head of real estate advisory and business at KPMG Hungary. The Amsterdam-based CTP, whose portfolio spans eight million sqm of leasable space, making it the market leader in CEE and a top five developer in Europe, according to its LinkedIn page, is developing under the BREEAM in-use “Excellent” standard for buildings across its Central European portfolio. The company is emphasizing energy efficiency and solar panels in its portfolio. Panattoni, headquartered in Newport Beach, California, but with development offices across the United States, Europe and Canada, has achieved BREEAM “Outstanding” accreditation for its park in Cheb in the Czech Republic. The company aims to achieve emission neutrality for all its buildings across Europe
by
2025
and is aspiring for at least BREEAM accreditation for its portfolio. The first development by Panattoni in Hungary, Panattoni Park Budapest City West, comprises four speculative logistics buildings with electric vehicle charging, enhanced wall and roof insulation, a water recycling system and LED lighting. The company is seeking BREEAM “Very Good” accreditation, with completion Panattoni Budapest City West. due in the third quarter of 2023.
193,000 sqm
of certified space. “We use our own construction company in addition to some big names as sub-contractors. We want to develop buildings that are unique in terms of sustainability, services, and look and design,” comments HelloParks managing director Rudolf Nemes.
“We want to develop buildings that are unique in terms of sustainability, services, and look and design. If you go there, you feel the difference from other sheds, which are grey and not in a very attractive location, and we wanted to change this. What we are doing in each location is developing a project with several buildings, and the number of people working there will be several thousand; this is essentially a village.” “If you go there, you feel the difference from other sheds, which are grey and not in a very attractive location, and we wanted to change this. What we are doing in each location is developing a project with several buildings, and the number of people working there will be several thousand; this is essentially a village,” he explains. “We delivered the first warehouse in the Central European region to be awarded a BREEAM ‘Excellent’ accreditation. All the remaining buildings we are developing are going to be BREEAM ‘Outstanding’ New Construction. I do not think any buildings in the region have achieved this level of accreditation,” Nemes adds.
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More Development Moving to Provincial Hubs Industrial development activity is extending to provincial logistics hubs outside the Greater Budapest area, as is the model elsewhere in Central Europe, says the Budapest Business Journal’s real estate editor, Gary J. Morrell. Poland and the Czech Republic continue to be the dominant markets in the region, as both benefit from their geographic position in major European logistics and industrial networks, notably with close proximity to Germany. In Hungary, the developer-led market has traditionally been limited to the Budapest area around the M0 orbital motorway, as light industrial companies tended to establish their own owner-occupied facilities. This is reflected by the Budapest Research Forum, which has tracked stock changes and vacancy rates in the Greater Budapest area rather than for Hungary overall. “Most of Hungary’s logistics space is concentrated around Budapest, in particular along the M0 road, whereas production facilities are spread throughout the country, often incentivized through subsidy and attracted by substantially lower labor costs,” comments Cushman & Wakefield. “Therefore, most manufacturers operate in owner-occupied schemes and are not part of the Hungarian institutional stock. With some four million [sqm of space] built for lease, the Hungarian market is one of the smallest in Central Europe,” it notes. Although Hungary is now seeing development growth away from Budapest,
57% of
completions were still in Central Hungary (the region comprising the capital and the surrounding Pest County) in 2021, and it has 49% of the pipeline under construction pipeline. Western Hungary has a pipeline of 370,000 sqm, and Eastern Hungary 190,000 sqm, according to CBRE.
Critical Player
The automotive industry has been a critical player in the industrial and logistics sector outside the capital,
CTPark Tatabánya is part of the portfolio of leading CEE developer and park operator CTP. with production and component centers in Győr, Kecskemét, Debrecen and Esztergom, where functioning commercial developer-led industrial hubs are emerging. While auto manufacturing is moving from traditional internal combustion engine products toward electric vehicle production, this is creating opportunities for battery manufacturers and other related product suppliers in Hungary. “These brands operate out of owneroccupied schemes, and their presence is the catalyst of build-to-suit development in their surroundings. These warehouses are usually occupied by direct suppliers of the main plant,” adds Cushman & Wakefield. The consultancy has traced 2.9 million sqm of industrial and logistics space in the Budapest area and another
1.3 million sqm
in the countryside; that makes for a very small stock in comparison with other Central European markets. The stock per capita is below the regional average in Central Europe, which indicates there is scope for growth in Hungary’s secondary markets. The Hungarian Infogroup has most of its developments in countryside locations. The developer has launched a 20,000 sqm speculative development in Kecskemét, another of the same size in Miskolc, and is about to commence a further project in Polgár. At Tatabánya, it will deliver a 9,700 sqm logistics facility for Magyar Posta. The company has a portfolio
of around 100,000 sqm of logistics and industrial space, mainly located in eastern and central Hungary.
“Most manufacturers operate in owner-occupied schemes and are not part of the Hungarian institutional stock. With some four million [sqm of space] built for lease, the Hungarian market is one of the smallest in Central Europe.”
land bank that covers most regional cities across Hungary. The company aims to deliver logistics parks in areas not provided for by the market and currently has around 20 parks in locations across the country. Its latest project, Inpark Nagykanizsa, is located on a 73-hectare site in the west of Hungary. This brings space in the portfolio to 230,000 sqm across Hungary. The leading CEE developer and park operator CTP has projects in the Budapest area in addition to secondary cities such as Győr, Debrecen, Szeged, Komárom and Tatabánya, and plans to have one million sqm of BREEAM accredited space in Hungary by the end
of
Balázs Czifra, director of sales, asset management and business development at Infogroup, sees strong demand in both logistics (e-commerce driven) and manufacturing and light industrial, mainly assembly halls.
E-mobility Trends
The automotive industry, and in particular the new trends related to e-mobility, is providing a secure base to support growth further. The company also sees a strengthening demand for city-logistics properties and therefore has such schemes under planning and permitting with a focus on Central and Eastern Hungary. With regard to further development outside the capital, the state-owned National Industrial Park Operator and Developer (NIPÜF) has a development
2022.
The regional industrial park developers and operators are the biggest owners of industrial stock in Hungary. With the new Prologis Sziget II development, Prologis has a pipeline of 50,000 sqm of space in Hungary for the year. The developer is concentrating its development strategy in the M0 area around Greater Budapest. The government says it is committed to improving the infrastructure from a logistics perspective, providing road links to major motorways where they are lacking. Further, from an international perspective, the Budapest-Belgrade rail link renewal, a project largely financed by China, will provide a 130 km high-speed link between the two capitals.
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DHL: Promoting Diversity and Helping SMEs BBJ: DHL was the first logistics company to commit to a zeroemissions target. What is the company doing in Hungary to achieve this target? AL: From this year on, our Budapest headquarters is powered by 100% green energy. We are also making significant investments in our other existing properties to operate our infrastructure with electricity from entirely renewable sources. In
Estonian expat Andra Ligi, DHL Express Hungary’s director of sales and marketing, talks to the Budapest Business Journal about her experiences in the country, the logistics company’s growth in the past few years, its zeroemissions targets, and what it is doing to help small companies and promote equality and diversity.
“Our senior management team is actually balanced at 50% female and 50% male here in Hungary, but back in Estonia, I used to work with a 100% female management team. Diversity is one of the most critical focus areas of DHL globally. Our aim is to create a sense of belonging among our people by strengthening diversity, equity and inclusion. We believe that people who feel accepted and valued are more engaged and more motivated.”
BENCE GAÁL
BBJ: You joined DHL Express Hungary in 2018. As an expat manager, how do you like the country? Why did you decide to continue your career in Hungary after spending eight years as the director of sales and marketing in Estonia? Andra Ligi: Living in Hungary as a foreigner has been quite a journey, with its ups and downs. I fell in love with Budapest almost immediately, as it has the most spectacular setting I’ve ever seen. The city has so many opportunities to visit that one almost cannot choose where to go. The country has many spectacular sites and options to get away from the city as well. I’ve been working for DHL Express for 22 years. My decision to move from a relatively small country like Estonia to a larger country was driven mainly by my wish to explore a new and different culture. And also to gain experience and learn, both professionally and individually.
achievement is that during the pandemic, DHL Express Hungary could still grow and create new jobs, despite the setback to the industry and the economic difficulties. Also, it currently provides a secure livelihood for around 400 people and their families in Budapest and its logistics centers across the country. Our strength is in our team, and we invest a lot in training to develop the skills of our colleagues, as they are our number one priority.
BBJ: What do you consider the company’s most significant achievement over the last four years? AL: It is really hard to pick just one, but personally, I think our biggest
BBJ: Currently, DHL Express Hungary has more female senior managers than men, which is a rarity in Hungary. How does the company promote gender equality in the workplace?
Andra Ligi, director of sales and marketing at DHL Express Hungary. AL: Our senior management team is actually balanced at 50% female and 50% male here in Hungary, but back in Estonia, I used to work with a 100% female management team. Diversity is one of the most critical focus areas of DHL globally. Our aim is to create a sense of belonging among our people by strengthening diversity, equity and inclusion. We believe that people who feel accepted and valued are more engaged and more motivated. We also participate in the “Great Place to Work” and “TOP Employer” programs. DHL Express has a unique variety of different talent and leadership development programs available, including unique platforms for female employees.
Budapest, we already deliver parcels with 20 e-vans and in the downtown area use three e-cargo bikes. Our GoGreen service offers our customers the possibility to choose this option and offset their CO2 emissions. We are making significant efforts to ensure that more of our customers take advantage of it. We would like to achieve that more than 50% of our sales have green solutions while 80% of our staff are GoGreen experts in the upcoming years. DHL Express’ global goal is to transform its fleet to at least 60% fully electric by 2030 and to achieve zero emissions and carbon neutrality by 2050. Globally, we have a sustainability roadmap that contains a EUR 7 billion investment in climateneutral logistics by 2030; 80,000 e-vehicles shall be deployed for lastmile deliveries, resulting in 60% electrification of the fleet. BBJ: How does the company help the export activities of SMEs in Hungary? AL: We at DHL Express think that the best way to help domestic SMEs is by educating them about the possibilities of international expansion. We have become key members of the Ecommerce Hungary Association and the Digital Commerce Alliance (DKSZ), working with partners who can provide
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Bio Box After spells as a customer service representative, travel consultant and hotel receptionist, Andra Ligi joined DHL Express Estonia AS as a customer service agent in April 2000. After gaining experience as a telesales and then a field sales executive based in Tallinn, she was promoted to key account manager in 2006 and then sales and marketing director in 2010. Eight years later, she moved from Tallinn to Budapest.
significant knowledge, intelligence, and advice for Hungarian e-commerce businesses. Besides education, we have options like our “Power Up Your Potential” program, developed for our e-commerce clients, which helps companies achieve more export business. With this, we can help our partners improve their websites and reach more potential customers. We see that the method of delivery is of crucial importance for our customers; that at least one express delivery option is a must; and that transparency, speed and flexibility are vital to servicing customers’ needs. Our focus is to help every business regardless of size, as we ship to 220 countries
BBJ: Compared to 2019, DHL Express revenue increased by more than 10% globally in 2020, and from 2020 to 2021, the figure was more than 20%. Considering that growth in Hungary was even higher, what are DHL Express Hungary’s revenue expectations for 2022?
“We at DHL Express think that the best way to help domestic SMEs is by educating them about the possibilities of international expansion. We have become key members of the Ecommerce Hungary Alliance and the Digital Commerce Alliance, working with partners who can provide significant knowledge, intelligence, and advice for Hungarian e-commerce businesses.” AL: Given the changes in the energy and regulatory environment, which, of course, also affect the operations of DHL Express and our partners, it is difficult to give an estimate of our projected results for this year. The global forecast shows that the global revenues of the e-commerce segment could reach USD 5.4 billion.
INSIDE VIEW
Recruitment Boom: Labor Market Demands Shaping Logistics and Supply Chains Krisztián Moldován
Team leader of Logistics and Supply Chain HAYS HUNGARY
Last year, the logistics market went through momentous change. Every sub-field was growing dynamically, from logistics service centers through trading businesses to the manufacturing segment setting on a pinnacle of expansion.
planners, while there is also growing demand for experienced customs professionals who speak English. However, suitable candidates are scarce on the market.
Best Paying Positions
According to our latest labor market report, the Hays Salary Guide 2022, almost all logistics positions have enjoyed a salary increase compared to last year, partly due to increased demand and partly from a shortage of specialists in the market. The highest salaries go to procurement experts, followed by logistics professionals, production planners and coordinators, and the list ends with customs experts.
Employer Wishes
As raw material shortages pose a significant threat to supply chains, there are several competing issues facing companies today. Increased and backlogged orders are becoming more urgent, and suppliers’ capacity is being stretched. As a result, there’s rising demand for production planners to ensure structured planning, adequate use of resources, and that products and commodities arrive at the right destination on time.
Competing for the best-skilled talent, employers are more curious to see whether they offer a competitive salary within their industry. In the past year, the Hays Salary Benchmark service has become highly popular among logistics and supply chain businesses. We provide companies with a tailor-made study for their segment, containing a detailed market overview and up-to-date salaries for specific positions that their competitors offer. We also provide consultancy services to our clients to get the best candidates on the market, make their employer brand more attractive, and build a future-proof hiring strategy. The number of new open positions in logistics and supply chains has doubled in the past three years, which shows the enhanced hiring pace. Companies appreciate the long-term and strategic partnership we offer that enables them to plan for today and tomorrow. At Hays, a specialized recruitment team ensures we find the right talent for the right position. With in-depth market knowledge and recruitment expertise that spans 15 years in Hungary, we can build entire teams quickly and efficiently.
The Recruitment Boom
Tomorrow’s Labor Market
This expansion trend, the increased demand, and raw material shortages are directly reflected in the labor market. Krisztián Moldován, logistics and supply chain expert from leading recruitment agency Hays Hungary, summarizes the main trends shaping the market today and tomorrow.
Today’s Demand
In these “post-pandemic” times, companies across industries have started to recruit at a high pace. This was particularly true for logistics and supply chain companies. In the past year, our clients opened around 10-15 positions at once, an unprecedented increase compared to the pre-COVID era. We also started to recruit talent for new functions and to build entire teams from zero.
Logistics is always on the go. This industry cannot stop functioning as manufacturing and trade requires materials and products all the time. In the future, we expect to see the demand for talent increase further. At the same time, employers must consider higher salary expectations from skilled professionals that are already showing in the current economic climate.
Most Wanted Talent
DHL Express’ Budapest headquarters is now powered by 100% green energy.
The skills shortage is a pressing issue in the industry. Like last year, the highest demand still seems to be for logistics talent. Besides these, companies have opened a surprisingly high number of positions for
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NOTE: ALL ARTICLES MARKED INSIDE VIEW ARE PAID PROMOTIONAL CONTENT FOR WHICH THE BUDAPEST BUSINESS JOURNAL DOES NOT TAKE RESPONSIBILITY
and territories. We are constantly improving our services and making investments to continue to be able to suit customer needs.
Special Report | 19
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Logistics and Industrial Sector Thriving Across Central Europe The logistics/ industrial market in Central Europe is booming from both a demand and development perspective. Analysts tell the Budapest Business Journal this sector is in the most favorable position in the currently problematic economic and geopolitical environment. GARY J. MORRELL
Continued low vacancy rates and rising rental levels are forecast due to high demand. In Prague, vacancy rates stand at less than 3%. The positive indicators for the sector are attracting a growing number of investors with resulting yield compression. Several industrial portfolio transactions have been concluded over the past year. However, industrial park owners tend to hold onto their assets and, therefore, the sector suffers from low supply. According to Cushman & Wakefield, the industrial sector represented only 13% of investment
Cushman & Wakefield data. Despite the significant deliveries, the vacancy rate has remained below 2% for the country, leading to rental growth in all industrial hubs. Romania is emerging as a significant industrial and logistics market with more than 4 million sqm of stock. Major developments are also ongoing in the different areas of the country, an indication that a regional industrial network has emerged in the country outside of Bucharest. CTP, for example, is planning a EUR 300 million regional network of parks that will bring its total space in the country to 2.5 million sqm, according to the company.
Market Growth
One advantage Hungary offers, in the view of analysts, is the possibility for market growth into Southern and Southeastern Europe. In Serbia, CTP has delivered a
25,000-sqm facility
Panattoni BTS project in Poland. volume for Central and Eastern Europe (which it classifies as the Czech Republic, Hungary, Poland, Romania and Slovakia) in the first quarter of the year. This low level reflects the lack of available assets, despite the strong interest from investors. The cumulative industrial/logistics stock for the region stands at more than 40 million sqm, according to Cushman & Wakefield. Despite significant development, the consultancy says that the overall vacancy rate in all markets stands at below 6% as of the first quarter of the year. The Czech Republic has the lowest rate
at
1.8%,
followed by Poland (3.3%), just ahead of Romania (3.8%), with Hungary at 4.2% and Slovakia trailing at 5.6%. More than 7.8 million sqm was under construction in Q1, 60% of which was in Poland. Of the pipeline, 40% was speculative, reflecting the confidence in these CEE industrial markets.
The Czech Republic has approaching 10 million sqm of industrial space across several different logistics hubs. The county is easily the largest in the regional logistics market in terms of sqm of space per 1,000 inhabitants, followed by Poland and Slovakia, according to Cushman & Wakefield figures. Budapest and Prague have the lowest vacancy rates in the CEE region.
Dominant Players
Poland, the Czech Republic, and Slovakia continue to be the dominant CEE markets, as the countries benefit from their geographic location within significant logistics and industrial networks, notably with close proximity to Germany and the industrial heartland of Europe. Therefore, all three countries have fully developed industrial hubs away from their respective capitals. Poland is by far the biggest industrial market in CEE, with a total stock of more than 21 million sqm in various logistics hubs spread across the country and a vacancy rate of 6%, according to JLL. In the first quarter, developers commenced the construction of 1.5 million sqm of industrial space, bringing the total Polish pipeline to 4.8 million sqm, Cushman & Wakefield reckons. Avison Young agrees, saying Poland is breaking all industrial/logistics records. “The industrial sector’s growth continued in 2021, resulting in almost EUR 3 billion in transaction volume, the highest result in history,” said the consultancy. Demand remains high in the Czech Republic, with a vacancy rate of
just
1.6%.
CTPark Plzeň in the Czech Republic.
For 2022, 1.5 million sqm of space is planned, with 1.1 million sqm of that already under construction and more than 70% of it pre-let, according to
for BMTS Technology at CT Park Novi Sad. Construction of CTPark Belgrade North is ongoing, but, despite this, the stock remains at a low level. Partly as a result, a developer-led industrial market is now emerging. CTP has also acquired development sites in Bulgaria.
Central European Industrial Stock Country
Stock
Czech Republic
10 mln sqm
Hungary Poland
4 mln sqm 21.5 mln sqm
Romania
5 mln sqm
Slovakia
2.6 mln sqm Source: Cushman & Wakefield
With the sector looking to be a clear winner in the post-coronavirus period, developers who have traditionally been active in other mainstream sectors, such as offices and retail, have undertaken industrial projects. These add to the specialist CEE regional industrial/logistics park operators such as Prologis, CTP and Panattoni. Developers across the region face challenges in the development and construction process in an increasingly competitive and demanding market. Challenges include labor and materials availability and costs, as well as sourcing development plots with direct road and public transport links. Although the Central European industrial/logistics sector has successfully recovered from the pandemic with thriving logistics markets and light industrial hubs, the war in Ukraine and associated geopolitical and economic concerns have brought a cloud over the market in many parts of the region.
4
www.bbj.hu
Budapest Business Journal | July 29 – September 8, 2022
Special Report | 21
Logistics Parks Ranked by net warehouse space used for logistics warehousing
WaRehouse LogistiCs
RaiL LogistiCs
aCCessibiLity to tRuCks
aCCessibiLity via WateR
domestiC WaRehousing
buiLding management
distRibution
Customs seRviCe
yeaR estabLished
oWneRshiP (%) hungaRian non-hungaRian
1
CtPaRk budaPest West www.ctp.eu
CtP management hungary kft. 2051 Biatorbágy, Verebély László u. 2. (30) 259-2465, www.ctp.eu
232,000
✓
–
✓
–
✓
✓
✓
–
2016
– CTP Invest, spol. s r.o. (100)
dávid huszlicska Tímea Pekár Milla Kalmár
2051 Biatorbágy, Verebély László utca 2. (30) 222-5577 milla.kalmar@ctp.eu
2
dePo inteRmodáLis táRsas Logisztikai közPont kft. www.depologisztika.hu
depo intermodális társas Logisztikai központ kft. 2045 Törökbálint, Hosszúrét (23) 338-044, www.depologisztika.hu
218,000
✓
✓
✓
–
✓
–
✓
✓
1978
(100) –
zsolt takács – –
2045 Törökbálint, Hosszúrét hrsz. 062. (23) 338-044 titkarsag@depologisztika.hu
3
PRoLogis PaRk budaPest-sziget www.prologiscee.eu
Prologis hungary 1095 Budapest, Lechner Ödön fasor 7. (1) 577-7700, www.prologiscee.eu
202,000
–
–
✓
–
–
✓
–
–
2001
– Real estate funds (100)
Paweł sapek – Marta Tesiorowska
2310 Szigetszentmiklós, Leshegy utca 30. (1) 577-7700 zhunyadi@prologis.com
4
budaPest doCk szabadkikötő Logisztikai és iPaRi PaRk www.bszl.hu
icon Real estate management kft. 1026 Budapest, Riadó utca 5. (70) 662-5639, www.iconrem.hu
180,000
✓
✓
✓
✓
✓
✓
✓
✓
1928/ 2003
State (100) –
ottó Cseh Edina Sponga –
1211 Budapest, Weiss Manfréd út 5–7. (1) 278-3502 info@bszl.hu
5
PRoLogis PaRk budaPest-gyáL www.prologiscee.eu
Prologis hungary 1095 Budapest, Lechner Ödön fasor 7. (1) 577-7700, www.prologiscee.eu
175,000
–
✓
–
–
–
✓
–
–
2002
– Real estate funds (A)
Paweł sapek – Marta Tęsiorowska
2360 Gyál, Gorcsev Iván utca 7. (1) 577-7700 zhunyadi@prologis.com
6
PRoLogis PaRk budaPesthaRboR www.prologiscee.eu
Prologis hungary 1095 Budapest, Lechner Ödön fasor 7. (1) 577-7700, www.prologiscee.eu
155,000
–
✓
✓
–
–
✓
–
✓
2001
– Real estate funds (100)
Paweł sapek – Marta Tesiorowska
1225 Budapest, Campona utca 1. (1) 577-7700 zhunyadi@prologis.com
7
áti dePo közRaktáRozási zRt. www.atidepo.hu
József földházi Mária Frühwirth Szabóné Györgyi Szabó Kovácsné
1136 Budapest, Pannónia utca 11. (1) 305-2200 mail@atidepo.hu
8
PRoLogis PaRk budaPestsziget ii www.prologiscee.eu
9
gLP ÜLLő aiRPoRt Logisztikai közPont https://www.glp.com/eu/
10
east gate business PaRk www.egbp.hu
11
Rank
net WaRehouse sPaCe used foR LogistiCs WaRehousing (sqm)
seRviCes
ComPany Website
oPeRating ComPany name addRess Phone, Website
toP LoCaL exeCutive Cfo maRketing diReCtoR
addRess Phone emaiL
áti dePo közraktározási zrt. 1136 Budapest, Pannónia u. 11. (1) 305-2200, www.atidepo.hu
153,000
✓
✓
✓
✓
✓
–
✓
✓
1996
Z.I. Logisztikai Zrt. (100) –
Prologis hungary 1095 Budapest, Lechner Ödön fasor 7. (1) 577-7700, www.prologiscee.eu
140,000
–
–
✓
–
–
✓
–
–
2008
– Real estate funds (100)
Paweł sapek – Marta Tęsiorowska
2310 Szigetszentmiklós, hrsz.: 12718/2. (1) 577-7700 zhunyadi@prologis.com
gLP Üllő kft.
131,730
✓
–
✓
–
✓
✓
–
–
2009
A A
– – –
2225 Üllő, Zsaróka út 8. (1) 336-2270 contact-hu@glp.com
Wing zrt. 1095 Budapest, Máriassy u. 7. (1) 451-4760, www.wing.hu
120,000
–
–
✓
–
✓
✓
–
–
2006
(100) –
– – –
2151 Fót, Akácos (1) 451-4760 egbp@wing.hu
mahaRt ContaineR CenteR kft. www.containercenter.hu
mahaRt Container Center kft. 1211 Budapest, Weiss Manfréd út 5–7. (1) 278-3178, www.containercenter.hu
111,000
–
✓
✓
✓
–
–
✓
✓
1997
High Yield Zrt. (50), WINTCO Kft. (50) –
zoltán fábián Mónika Kothencz Kölkediné István Hajdú
1211 Budapest, Weiss Manfréd út 5–7. (1) 278-3178 mail@containercenter.hu
12
CtPaRk budaPest east www.ctp.eu
CtP management hungary kft. 2051 Biatorbágy, Verebély László u. 2. (30) 259-2465, www.ctp.eu
103,000
✓
–
✓
–
✓
✓
✓
–
2016
– CTP Invest, spol. s r.o. (100)
dávid huszlicska Tímea Pekár Milla Kalmár
2225 Üllő, K-Sped körút 17. (30) 222-5577 milla.kalmar@ctp.eu
13
RaiL CaRgo teRminaL - biLk zRt. www.railcargobilk.hu
Rail Cargo terminal - biLk zrt. 1239 Budapest, Európa u. 4. (1) 289-6000, www.railcargobilk.hu
95,000
✓
✓
✓
–
–
–
–
✓
2001
– Rail Cargo TerminalPraha s.r.o. (100)
miklós ágh – –
1239 Budapest, Európa utca 4. (1) 289-6000 info.rct.bilk@railcargo.com
14
CtPaRk veCsés www.ctp.eu
CtP management hungary kft. 2051 Biatorbágy, Verebély László u. 2. (30) 119-2075, www.ctp.eu
80,000
✓
–
✓
–
✓
✓
✓
–
2016
– CTP Invest, spol. s r.o. (100)
dávid huszlicska – –
2220 Vecsés, 6127 hrsz. (30) 119-2075 peter.tar@ctp.eu
15
Login business PaRk www.loginbusinesspark.hu
Wing zrt. 1095 Budapest, Máriassy u. 7. (1) 451-4760, www.wing.hu
75,000
–
–
✓
–
✓
✓
–
–
A
(100) –
– – –
1044 Budapest, Ezred utca 2. (1) 451-4760 ipari@wing.hu
16
gLP sziget Logisztikai közPont www.glp.com/eu
www.glp.com/eu
69,766
✓
–
✓
–
✓
–
✓
–
2021
A A
stefan sova – –
2310 Szigetszentmiklós, Bevásárló utca 1. (1) 336-2270 contact-hu@glp.com
Special Report
www.bbj.hu
Budapest Business Journal | July 29 – September 8, 2022
WaRehouse LogistiCs
RaiL LogistiCs
aCCessibiLity to tRuCks
aCCessibiLity via WateR
domestiC WaRehousing
buiLding management
distRibution
Customs seRviCe
Prologis hungary 1095 Budapest, Lechner Ödön fasor 7. (1) 577-7700, www.prologiscee.eu
67,000
–
–
✓
–
–
✓
–
–
Wing zrt. 1095 Budapest, Máriassy u. 7. (1) 451-4760, www.wing.hu
60,000
–
–
✓
–
✓
✓
–
yeaR estabLished
oPeRating ComPany name addRess Phone, Website
net WaRehouse sPaCe used foR LogistiCs WaRehousing (sqm)
seRviCes
oWneRshiP (%) hungaRian non-hungaRian
toP LoCaL exeCutive Cfo maRketing diReCtoR
addRess Phone emaiL
2008
– Real estate funds (100)
Paweł sapek – Marta Tęsiorowska
2071 Páty, Szent József utca 4. (1) 577-7700 zhunyadi@prologis.com
–
2020
(100) –
– – –
2150 Fót, hrsz. 5453/3 (1) 451-4760 info@wing.hu
Rank
22 | 4
ComPany Website
17
PRoLogis PaRk budaPest m1 www.prologiscee.eu
18
east gate PRo www.wing.hu
19
CtPaRk budaPest south www.ctp.eu
CtP management hungary kft. 2051 Biatorbágy, Verebély László u. 2. (30) 847-3671, www.ctp.eu
58,000
✓
–
✓
–
✓
✓
✓
–
2016
– CTP Invest, spol. s r.o. (100)
dávid huszlicska – –
2330 Dunaharaszti, Gábor Áron utca 1. (30) 847-3671 andras.kiss@ctp.eu
20
CtPaRk komáRom www.ctp.eu
CtP management hungary kft. 2051 Biatorbágy, Verebély László u. 2. (30) 847-3671, www.ctp.eu
52,000
✓
–
✓
–
✓
✓
✓
–
2016
– CTP Invest, spol. s r.o. (100)
dávid huszlicska – –
2900 Komárom, Mylan utca (30) 847-3671 andras.kiss@ctp.eu
White star Real estate kft. 1124 Budapest, Csörsz utca 49–51. (1) 382-5100, www.whitestar-realestate. com
45,600
✓
–
✓
–
✓
✓
✓
–
2018
– (100)
krisztián barabás Marietta Biczó Larina Németh
1223 Budapest, Növény utca 6–10. (1) 382-5100 info@park22.hu
masPed Logisztika kft. 1211 Budapest, Szikratávíró u. 17–21. (1) 278-0951, www.masped.hu
45,000
✓
✓
✓
✓
✓
✓
✓
✓
2001
Masped Zrt. (100) –
marcell kovács Zsolt Bende –
1211 Budapest, Szikratávíró út 17–21. (1) 278-0951 logisztika@masped.hu
Wing zrt. 1095 Budapest, Máriassy u. 7. (1) 451-4760, www.wing.hu
45,000
✓
–
✓
–
–
✓
✓
✓
1996
Wing Zrt. (100) –
– – –
2220 Vecsés, Üllői út 807. (1) 451-4974 ipari@wing.hu
doCk ingatlan kft. 1211 Budapest, Weiss Manfréd 5–7. (1) 278-3502
42,000
A
A
A
A
A
A
A
A
2017
A A
ottó Cseh Edina Sponga –
1211 Budapest, Weiss Manfréd út 5–7. (1) 278-3502 info@bszl.hu
trans-sped kft. 4030 Debrecen, Vámraktár utca 3. (52) 510-120, www.trans-sped.hu
40,258
✓
–
✓
–
✓
✓
–
✓
1990
(100) –
Zsolt Fülöp – –
4030 Debrecen, Vámraktár utca 3. (52) 510-120 info@trans-sped.hu
PaRk22 ÜzLeti PaRk www.park22.hu 21
22
masPed PoRt Logisztikai közPont www.masped.hu
22
aiRPoRt City business PaRk www.wing.hu/hu/raktar
24
doCk ingatLan kft. www.bszl.hu
25
debReCeni Logisztikai közPont és iPaRi PaRk www.trans-sped.hu
26
igPaRk kaRCag https://ipariparkinfogroup.hu
infogroup management kft. 1115 Budapest, Bartók Béla út 105–113. (1) 481-4530, www.infogroup.hu
40,000
✓
✓
✓
–
✓
✓
✓
–
A
(100) –
– Máté Kovács Balázs Czifra
5300 Karcag, Kossuth Lajos tér 1. (1) 481-4530 sales@infogroup.hu
26
igPaRk keCskemét nyugat https://ipariparkinfogroup.hu
infogroup management kft. 1115 Budapest, Bartók Béla út 105–113. (1) 481-4530, www.infogroup.hu
40,000
✓
–
✓
–
✓
✓
✓
–
A
(100) –
– Máté Kovács Balázs Czifra
6000 Kecskemét , (Kadafalva) Heliport (1) 481-4530 sales@infogroup.hu
26
igPaRk PoLgáR https://ipariparkinfogroup.hu
infogroup management kft. 1115 Budapest, Bartók Béla út 105–113. (1) 481-4530, www.infogroup.hu
40,000
✓
✓
✓
–
✓
✓
✓
✓
A
(100) –
– Máté Kovács Balázs Czifra
4090 Polgár, Hajdú utca 40. (1) 481-4530 sales@infogroup.hu
29
CtPaRk aRRabona www.ctp.eu
CtP management hungary kft. 2051 Biatorbágy, Verebély László u. 2. (30) 847-3671, www.ctp.eu
37,000
✓
–
✓
–
✓
✓
✓
–
2016
– CTP Invest spol. s r.o (100)
dávid huszlicska – –
9027 Győr, Hűtőház utca (30) 847-3671 andras.kiss@ctp.eu
29
CtPaRk tatabánya www.ctp.eu
CtP management hungary kft. 2051 Biatorbágy, Verebély László u. 2. (30) 259-2465, www.ctp.eu
37,000
✓
–
✓
–
✓
✓
✓
–
2016
– CTP Invest spol. s r.o (100)
dávid huszlicska – –
2800 Tatabánya, Szarkaláb út (30) 259-2465 balazs.kovacs@ctp.eu
31
CityPoint 9 Logisztikai PaRk www.otpingatlanalap.hu
iCon Rem kft. 1026 Budapest, Riadó u. 5. (70) 662-5639, www.iconrem.hu
36,842
✓
–
✓
–
✓
✓
–
–
2002
OTP Ingatlanbefektetési Alap (100) –
– – –
1097 Budapest, Gubacsi út 32. (70) 662-5639 alapkezelo@otpingatlanalap.hu
32
déL-Pesti ÜzLeti PaRk www.diofaalapkezelo.hu
atq Property zrt. 1117 Budapest, Budafoki út 187–189.
34,000
✓
–
✓
–
✓
✓
✓
–
2004
A A
– – –
1097 Budapest, Táblás utca 36–38. (1) 888-4120 alapkezelo@diofaalapkezelo.hu
33
m5-gyáL business PaRk –
2002
OTP Ingatlanbefektetési Alap (100) –
– – –
2360 Gyál, Bem József utca 32. Hrsz:7702 (70) 662-5639 alapkezelo@otpingatlanalap.hu
iCon Rem kft. 1026 Budapest, Riadó u. 5. (70) 662-5639, www.iconrem.hu
33,235
✓
–
✓
–
✓
✓
–
–
4
www.bbj.hu
Budapest Business Journal | July 29 – September 8, 2022
Special Report | 23
WaRehouse LogistiCs
RaiL LogistiCs
aCCessibiLity to tRuCks
aCCessibiLity via WateR
domestiC WaRehousing
buiLding management
distRibution
Customs seRviCe
Logicor management hungary kft. 2040 Budaörs, Vasút u. 11. (30) 870-3047, www.logicor.eu
32,844
✓
–
✓
–
✓
✓
–
–
infogroup management kft. 1115 Budapest, Bartók Béla út 105–113. (1) 481-4530, www.infogroup.hu
32,000
✓
–
✓
–
✓
✓
✓
Logicor management hungary kft. 2040 Budaörs, Vasút u. 11. (30) 870-3047, www.logicor.eu
28,252
✓
–
✓
–
✓
✓
Prologis hungary 1095 Budapest, Lechner Ödön fasor 7. (1) 577-7700, www.prologiscee.eu
28,000
–
–
✓
–
–
dome facility servioces kft. 1023 Budapest, Lajos utca 28–32. (1) 423-0000, www.domefsg.com
26,931
✓
–
✓
–
CtP management hungary kft. 2051 Biatorbágy, Verebély László u. 2. (30) 847-3671, www.ctp.eu
25,000
✓
–
✓
A
24,000
✓
–
Logicor management hungary kft. 2040 Budaörs, Vasút u. 11. (30) 870-3047, www.logicor.eu
22,463
✓
agate kft.
22,200
oWneRshiP (%) hungaRian non-hungaRian
toP LoCaL exeCutive Cfo maRketing diReCtoR
addRess Phone emaiL
A
– (100)
bartosz mierzwiak – –
2040 Budaörs, Akron utca 1. (30) 870-3047 –
–
A
(100) –
– Máté Kovács Balázs Czifra
3526 Miskolc, Mechatronikai Park (1) 481-4530 sales@infogroup.hu
–
–
A
– (100)
bartosz mierzwiak – –
2051 Biatorbágy, Huber utca 5. (30) 870-3047 –
–
–
–
2005
– Real estate funds (100)
Pawel sapek – Marta Tesiorowska
2040 Budaörs, Seregély utca 8. (1) 577-7700 zhunyadi@prologis.com
✓
✓
–
–
2002
OTP Ingatlanbefektetési Alap (100) –
– – –
9027 Győr, Csókás út 4. (1) 423-0000 info@domefsg.hu
–
✓
✓
✓
–
2016
– CTP Invest, spol. s r.o. (100)
dávid huszlicska – –
8000 Székesfehérvár, Holland fasor 2. (30) 847-3671 andras.kiss@ctp.eu
✓
–
✓
–
–
–
2002
OTP Ingatlanbefektetési Alap (100) –
– – –
1211 Budapest, Terelő utca 2–4. (1) 236-6400 alapkezelo@otpingatlanalap.hu
–
✓
–
✓
✓
–
–
A
– (100)
bartosz mierzwiak – –
2040 Budaörs, Vasút utca 11. (30) 870-3047 –
✓
–
✓
–
✓
✓
–
–
2007
A A
– – –
2360 Gyál, Hrsz. 7000/15 (1) 336-2270 contact-hu@glp.com
Rank
yeaR estabLished
oPeRating ComPany name addRess Phone, Website
net WaRehouse sPaCe used foR LogistiCs WaRehousing (sqm)
seRviCes
ComPany Website
34
CameL PaRk www.logicor.eu
35
igPaRk miskoLC https://ipariparkinfogroup.hu
36
tuLiPán PaRk www.logicor.eu
37
PRoLogis PaRk budaPestbudaöRs www.prologiscee.eu
38
győR Csókás Logisztikai közPont www.domefsg.com/
39
CtPaRk székesfehéRváR www.ctp.eu
40
teReLő utCa www.otpbank.hu
41
shaRk PaRk www.logicor.eu
42
gLP gyáL Logisztikai közPont https://eu.glp.com/
43
igPaRk keCskemét déL https://ipariparkinfogroup.hu
infogroup management kft. 1115 Budapest, Bartók Béla út 105–113. (1) 481-4530, www.infogroup.hu
21,000
✓
–
✓
–
✓
✓
✓
–
A
(100) –
– Máté Kovács Balázs Czifra
6000 Kecskemét, Daimler út (1) 481-4530 sales@infogroup.hu
44
innove business PaRk www.diofaalapkezelo.hu
atq Property zrt. 1117 Budapest, Budafoki út 187–189.
19,060
✓
–
–
–
✓
✓
✓
–
2006
A A
– – –
1097 Budapest, Táblás utca 36–38. (1) 888-4120 alapkezelo@diofaalapkezelo.hu
45
igPaRk tiszaúJváRos https://ipariparkinfogroup.hu
infogroup management kft. 1115 Budapest, Bartók Béla út 105–113. (1) 481-4530, www.infogroup.hu
18,000
✓
–
✓
–
✓
✓
✓
–
A
(100) –
– Máté Kovács Balázs Czifra
3580 Tiszaújváros, Dózsa György utca (1) 481-4530 sales@infogroup.hu
46
CtPaRk szombatheLy www.ctp.eu
CtP management hungary kft. 2051 Biatorbágy, Verebély László u. 2. (30) 119-2075, www.ctp.eu
17,000
✓
–
✓
–
✓
✓
✓
–
2016
– CTP Invest, spol. s r.o. (100)
dávid huszlicska – –
9700 Szombathely, Puskás Tivadar utca 10. (30) 119-2075 peter.tar@ctp.eu
47
data34 ingatLanhasznosító kft. www.bszl.hu
data34 ingatlanhasznosító kft. 1211 Budapest, Weiss Manfréd út 5–7. (1) 278-3502, www.bszl.hu
16,155
✓
–
✓
–
✓
–
✓
✓
2020
Budapesti Szabadkikötő Logisztikai Zrt. (100) –
ottó Cseh Edina Sponga –
1211 Budapest, Weiss Manfréd út 5–7. (1) 278-3502 info@bszl.hu
48
masPed észak-Pesti Logisztikai közPont www.masped.hu
masPed zrt. 1211 Budapest, Weiss Manfréd út 5–7. (1) 278-3502
13,085
A
A
A
A
A
A
A
A
1948
A A
ottó Cseh – –
1211 Budapest, Weiss Manfréd út 5–7. (1) 278-3502 o.cseh@masped.hu
49
CtPaRk győR www.ctp.eu
CtP management hungary kft. 2051 Biatorbágy, Verebély László u. 2. (30) 259-2465, www.ctp.eu
11,000
✓
–
✓
–
✓
✓
✓
–
2016
– CTP Invest, spol. s r.o. (100)
dávid huszlicska – –
9027 Győr, Platánfa utca 6. (30) 259-2465 balazs.kovacs@ctp.eu
50
aquinCum Logisztikai PaRk www.otpingatlanalap.hu
icon Real estate management kft. 1026 Budapest, Riadó utca 5. (70) 662-5639, www.iconrem.hu
4,423
✓
–
✓
–
✓
✓
–
–
2002
OTP Ingatlan Befektetési Alapkezelő Zrt. (100) –
– – –
1033 Budapest, Szőlőkert utca 4/B (1) 336-0900 alapkezelo@otpingatlanalap.hu
24 | 4
Special Report
www.bbj.hu
Budapest Business Journal | July 29 – September 8, 2022
Logistics Service Providers
3
dHL CSoPoRt www.dhl.hu
A
104,526 A
4
RaiL CaRgo HungaRia ZRt. https://rch.railcargo.com
5
küHne + nageL kFt. www.kuehne-nagel.hu
65,004
6
WSZL kFt. www.wszl.hu
61,300
7
RaiL CaRgo LogiStiCS HungaRia kFt. www.railcargologistics.hu
8
SCHenkeR nemZetköZi SZÁLLítmÁnyoZÁSi éS LogiSZtikai kFt. www.dbschenker.com/hu
9
LiegL & daCHSeR SZÁLLítmÁnyoZÁSi éS LogiSZtikai kFt. www.dachser.hu
10
tRanSSPed CSoPoRt www.trans-sped.hu
25,127
11
gySev CaRgo ZRt. www.gysevcargo.hu
17,156 9,536
12
Raben tRanS euRoPean HungaRy kFt. www.raben-group.com
11,466 5,704
13
LageRmax autótRanSZPoRt kFt. www.lagermax.com
14
ekoL LogiStiCS kFt. www.ekol.com/en/ countries/hungary
75,457 A
A
A
34,662 19,364
29,840 A
25,780 A
A
10,788 A
10,357 A
domeStiC
CaRgo ConSoLidation
FtL
LtL
domeStiC goodS
dutiabLe goodS
tRanSPoRtation
diStRibution
WaRe HouSing SeRviCeS
inteRnationaL
A
A
✓
–
–
✓
✓
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–
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✓
✓
–
192,200 251,800
A
A
A
A
yeaR eStabLiSHed no. oF FuLLtime emPLoyeeS on june 1, 2022
211,800
RaiLWay
WabeReR'S inteRnationaL nyRt. www.waberers.com
A
diStRibution
2
220,417
WaReHouSing
magyaR PoSta ZRt. www.posta.hu
net WaReHouSe SPaCe uSed FoR LogiStiCS WaReHouSing (Sqm)
1
net Revenue FRom LogiStiCS SeRviCeS in 2021 (HuF mLn)
ComPany WebSite
totaL net Revenue in 2021 (HuF mLn) totaL net Revenue in H1, 2022 (HuF mLn)
Rank
Ranked by total net revenue in 2021
oWneRSHiP (%) HungaRian non HungaRian
A
1993 26,975
Hungarian state (100) –
✓
✓
✓
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✓
✓
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✓
Amazon, Ikea, Samsung
1948 5,805
A A
FReigHt FoRWaRding SeRviCeS
LogiStiCS SeRviCeS
✓
✓
✓
✓
✓
✓
✓
✓
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–
✓
–
✓
–
otHeR
✓
✓
majoR CLientS in 2021
✓
A
–
ISD DUNAFERR Zrt., voestalpine GmbH, BorsodChem Zrt., MOL Nyrt., AUDI HUNGARIA Zrt., Alcufer Kft.
1993 A
2005 A
– Deutsche Post AG (100)
toP LoCaL exeCutive CFo maRketing diReCtoR
addReSS PHone emaiL
györgy 1138 Budapest, Schamschula Dunavirág utca 2–6. Tamás Jäger (1) 767-8200 Szabolcs Török ugyfelszolgalat@posta.hu Zsolt barna Szabolcs Tóth Dorottya Varga
1239 Budapest, Nagykőrösi út 351. (1) 421-6666 info@waberers.com
Zoltán Rezsek, Zoltán gáldi, www.logistics.dhl/hu-hu/ Ádám györgy home/kapcsolatfelvetel. mészáros html – –
(0.01) Rail Cargo Austria AG (99.99)
norbert körös Román Kotiers Rita Szalay
1133 Budapest, Váci út 92. (1) 512-7777 ugyfelszolgalat@ railcargo.com
– Kühne + Nagel AG (100)
márton Lányi Rade Nikolic Szilárd Paál
2071 Páty, Szent József út 4. (23) 889-000 info.budapest@ kuehne-nagel.com
A
190,000
✓
✓
✓
✓
✓
✓
✓
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✓
✓
✓
A
1991 819
27,000
251,800
✓
✓
–
✓
✓
✓
✓
✓
✓
✓
✓
✓
A
1991 2,052
Waberer's International Nyrt. (100) –
Zsolt barna Szabolcs Tóth Dorottya Varga
3527 Miskolc, Fonoda utca 1. (1) 421-6666 wszl@waberers.com
– Rail Cargo Logistics Austria GmbH (100)
gábor márta Tamás Gáspár –
1133 Budapest, Váci út 92. (1) 430-8551 office.rcl.hu@ railcargo.com
– Schenker AG (100)
Sándor barényi – –
2310 Szigetszentmiklós, Leshegy utca 30. (1) 278-7878 info.hu@dbschenker.com
A
A
✓
✓
✓
✓
✓
–
–
–
✓
–
–
–
A
1982 84
A
53,400
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
A
1994 366
alexander – tonn, Dachser SE engelbert Liegl (50), EL Holding – s.r.o. (50) –
2085 Pilisvörösvár, Ipartelep utca 1. (26) 532-000 customer.pilisvorosvar@ dachser.com
A
62,905
✓
✓
✓
✓
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✓
✓
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✓
✓
✓
✓
A
1999 295
25,127
225,000
✓
✓
–
✓
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–
✓
✓
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✓
A
1990 850
Individuals (100) –
Szabolcs Fülöp Olivér Sziller Zoltán Zubán
4030 Debrecen, Vámraktár utca 3. (52) 510-120 info@trans-sped.hu
1,511
88,000
✓
✓
✓
✓
✓
–
✓
–
✓
✓
✓
✓
A
2009 236
GySEV Zrt. (100) –
jános boda – –
9400 Sopron, Mátyás király utca 19. (99) 577-206 info@gysevcargo.hu
A
1989 400
– Ewald Raben (100)
Csaba Árvai Noémi Szűcs Zoltán Üveges
2330 Dunaharaszti, Jedlik Ányos utca 31. (24) 502-002 hungary.info@ raben-group.com
jános molnár Bálint Hetyei –
2040 Budaörs, Vasút utca 3. (23) 506-100 lagermax@lagermax.hu
Ákos kovács Attila Harmos –
1211 Budapest, Szikratávíró út Hrsz.: 210023 (1) 872-6100 ekol.hungary@ekol.com
11,466
A
A
70,000
230,000
15,500
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–
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–
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A
1990 298
– Beteiligungsgesellschaft Lagermax Autologistik International GmbH (100)
✓
Car, electronics, oil and pharmaceutical industry
2013 250
– Ekol Lojistik AŞ (100)
4
www.bbj.hu
euRoSPed ZRt. www.eurospedzrt.hu
10,014 A
16
bika LogiSZtika kFt. www.bikalogisztika.hu
17
RaiL CaRgo teRminaL biLk ZRt. www.railcargobilk.hu
18
maSPed LogiSZtika kFt. www.masped.hu
19
veRSteijnen LogiStiCS kFt. www.versteijnen.com
20
Áti dePo köZRaktÁRoZÁSi ZRt. www.atidepo.hu
9,855 5,952
3,264 A
3,216 1,503
3,087 A
2,882 A
21
PLimSoLL ZRt. www.plimsoll.hu
1,935
22
FLuviuS kFt. www.fluvius.hu
581
23
inteRCaRgo HungaRy kFt. www.intercargo.hu
A
A
382 A
24
euRo mini StoRage HungÁRia kFt. www.euroministorage.hu
25
autókeR LogiSZtikai kFt. www.businesspark.hu
26
bajai oRSZÁgoS köZFoRgaLmú kikötőműködtető kFt. www.portofbaja.hu
A = would not disclose,
NR = not ranked, NA = not appliacable
265 135
93 A
81 A
10,014
9,708
A
30,000
✓
✓
–
✓
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majoR CLientS in 2021
oWneRSHiP (%) HungaRian non HungaRian
–
Continental Group, ENI, Bunge Zrt., Le Bélier Group, Prysmian MKM Kft.., Hamburger Hungária Kft.
2018 57
Sped-Invest Team Kft. (91), Kovalona Kft. (9) –
✓
Claas Hungária Kft., SMP Automotive Mirror Technology Hungary Bt., Eagle Ottawa Hungary Kft., Stadler Szolnoki Vasúti Járműgyártó Kft., Essentra Filter Products Kft., DRENIK Hungary Kft.
1991 165
Anita Biró Karmazinné (100) –
gabriella Szécsi Dorina Törőcsik Kovácsné Attila Katkics
5000 Szolnok, Városmajor út 23. (56) 524-050 info@bi-ka.hu
– Rail Cargo Terminal-Praha s.r.o. (100)
miklós Ágh – –
1239 Budapest, Európa utca 4. (1) 289-6000 info.rct.bilk@ railcargo.com
–
✓
diStRibution
otHeR
tRanSPoRtation
dutiabLe goodS
WaRe HouSing SeRviCeS ✓
domeStiC goodS
LtL
FtL
CaRgo ConSoLidation
domeStiC
inteRnationaL
RaiLWay
diStRibution
WaReHouSing
net WaReHouSe SPaCe uSed FoR LogiStiCS WaReHouSing (Sqm)
net Revenue FRom LogiStiCS SeRviCeS in 2021 (HuF mLn)
ComPany WebSite
FReigHt FoRWaRding SeRviCeS
LogiStiCS SeRviCeS
Special Report | 25
yeaR eStabLiSHed no. oF FuLLtime emPLoyeeS on june 1, 2022
15
totaL net Revenue in 2021 (HuF mLn) totaL net Revenue in H1, 2022 (HuF mLn)
Rank
Budapest Business Journal | July 29 – September 8, 2022
toP LoCaL exeCutive CFo maRketing diReCtoR
addReSS PHone emaiL
istván 1138 Budapest, Sevecsek Szekszárdi utca 14. Judit Tankovics (1) 450-9000 – eurosped@eurospedzrt.hu
A
A
–
✓
✓
✓
–
–
✓
–
–
–
–
✓
A
2001 98
3,127
45,000
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✓
✓
✓
✓
✓
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✓
✓
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✓
A
2001 134
Masped Zrt. (100) –
marcell kovács Zsolt Bende –
1211 Budapest, Szikratávíró utca 17–21. (1) 278-0951 logisztika@masped.hu
A
6,000
✓
✓
–
✓
✓
✓
✓
✓
✓
✓
✓
✓
A
1995 57
– Versteijnen Logistics Group B.V. (100)
Sándor voller Zoltán Jobb –
9600 Sárvár, Nádasdy Ferenc utca 145. (95) 325-777 info.hu@versteijnen.com
1996 152
Z.I. Logisztikai Zrt. (100) –
józsef Földházi Mária Frühwirth Szabóné Györgyi Szabó Kovácsné
1136 Budapest, Pannónia utca 11. (1) 305-2200 mail@atidepo.hu
2,400
153,000
✓
✓
✓
✓
✓
–
✓
✓
✓
✓
✓
✓
A
A
6,000
–
–
✓
✓
✓
–
✓
–
–
–
✓
–
A
2016 12
– TTS botond Szalma (TRANSPORT – TRADE – SERVICES) S.A. (100)
A
–
–
–
–
✓
–
–
–
–
–
–
✓
–
A
2001 7
PLIMSOLL Zrt. (100) –
botond Szalma – –
1139 Budapest, Forgách utca 9/B (1) 237-1100 fluvius@fluvius.hu
A
A
✓
–
–
✓
–
✓
✓
✓
✓
✓
✓
–
A
1993 3
CG Invest Kft. (100) –
Csilla gömze – –
1117 Budapest, Szerémi út 7/B (1) 425-2240 info@intercargo.hu
–
Kempinski Hotel Budapest Zrt., CRAFT KLÍMA- és HŰTÉSTECHNIKAI Kft., Diatron Medicinai Instrumentumok Zrt., C.A.B. Hungary Kft., MIXIO KER Kft.
2006 5
– Euroministorage Investments (Cyprus) Ltd. (100)
danu m. temelie – –
1097 Budapest, Gyáli út 50. (1) 333-8888 info@ euroministorage.com
1989 5
X Ingatlanfejlesztő és Ingatlanhasznosító Zrt. (100) –
Zoltán Szabó – –
2360 Gyál, Heltai Jenő utca 73. (29) 544-690 info@businesspark.hu
1999 4
MNV Zrt. (33.33), Baja Municipality (33.33), ÁTI Depo Zrt. (33.33) –
László nagy – –
6500 Baja, Szentjánosi utca 12. (79) 422-502 info@portofbaja.hu
265
A
A
7,000
A
A
✓
✓
✓
–
–
✓
–
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–
–
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–
–
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–
–
–
–
–
–
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–
–
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–
–
✓
✓
✓
A
A
1139 Budapest, Forgách utca 9/B (1) 210-9800 plimsoll@plimsoll.hu
This list was compiled from responses to questionnaires received by July 27, 2022, and publicly available data. To the best of the Budapest Business Journal’s knowledge, the information is accurate as of press time. The list is based on companies’ voluntary data submissions. 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
5
www.bbj.hu
Budapest Business Journal | July 29 – September 8, 2022
Socialite
Matisse Masterpieces Offer Another Fine Arts Exhibition in Budapest
Henri Matisse: The Color of Ideas, Masterpieces from the Centre Pompidou, Paris runs until Oct. 16, 2022 at the marvelous Museum of Fine Arts in Budapest. The Matisse exhibition, the first major show of his art in Hungary, continues the remarkable run of first-rate exhibitions that has made last year and this two of the museum’s most successful ever.
I hadn’t been aware that Matisse was also an important sculptor. But, as “Sculptures, 1909-1930” shows, his “The Back” series “demonstrates a brand-new concept of monumentality and stylization of form,” according to the Museum. “Figures and Interiors, 1918-1929” covers the period Matisse spent in Nice and focuses on his interiors. One can’t help but wonder whether, in this post-World War I period of chaos and economic turmoil, Matisse was consciously retreating from the outside world. This perhaps also explains why, in this period, he was regarded as upholding the tradition of French classical painting. His 1921 “Odalisque with Red Culottes” (Odalisque à la culotte rouge, 1921) is classical in subject but his treatment is thoroughly modern.
Transformational Travel
Matisse traveled to the United States and Tahiti in 1930 and, as the “Modernist Experiments, 1930-1946” section shows, the inspiration he drew from his travels transformed his work. It became simpler and more complex at the same time. “From Nice to Vence, 1938-1946” covers what Matisse called a second “flourishing” of his art. (Vence is a small town on the French Riviera.) The “Vence Interiors,” in particular, show how he explored the relationships between color and line and color and space. “Chapel of the Rosary, Vence, 19481951” and “Paper Cut-outs and Late “Odalisque with Red Culottes” (Odalisque à la culotte rouge), 1921 Works, 1937-1954” were, for me, the two most interesting sections. I had no idea Matisse had decorated the Dominican about when a critic described their work Chapel of the Rosary in Vence or that he for supposedly upholding the classical as an “an orgy of pure tones” or intense, developed a method of collage involving tradition. From 1930 onwards, he undiluted color. gouache paper cut-outs. simplified the forms in his painting even It’s this, combined with vigorous, The cut-out “Pale Blue Window” is more. When he could no longer paint, he rough brushstrokes, that make Matisse’s so charming that its modernism can be took to cutting paper collage. early work so exciting. In contrast with missed if one is not careful. Deep and Comprehensive the Impressionists, his work and that of By the time one has wandered through DAVID HOLZER All of this is represented at the exhibition “Henri Matisse: The Color of Ideas,” it’s the other Fauves is, well, wild. at the Museum of Fine Arts, which More significantly, it is, as the not difficult to agree with his statement Matisse (1869-1954) is, in his own goes deeply and comprehensively into Guggenheim Bilbao describes it, “an that he managed to give painting “a quieter way, as important a modern artist outrageous departure from traditional demonstrating Matisse’s development new start.” As he went on to say, “Is it as Picasso. He began as a member of over the 64 years in which he painted. art.” This rupture led some of the pretentious? Maybe, but why not?” It’s the mostly French school the Fauves. It includes more than 150 works, Fauves to Cubism, even more removed also possible to grasp the consistency of The name means “wild beasts.” It came arranged into eight chronologicalfrom “realistic” art. Matisse’s work. thematic sections. These range from his Matisse and his fellow Fauves interest The title of the exhibition comes earliest compositions to pieces from the in African and Oceanic art, made from a phrase the French poet Louis 1950s and explore issues central to his by the people of the Pacific Islands Aragon attributed to the painter and oeuvre, such as the relationship between it’s highly appropriate. Matisse was and Australia, also influenced the development of Western avant-garde art. line and color and connections between always wrestling with questions of space This seeming departure from what had interiors and figures. and plane, interior and figures as well Later in life, Matisse was aware that he gone before, the use of simplification as color and line. He also constantly didn’t paint like other artists. He described returned to and reinvented these and abstraction and the emphasis on himself as, in the beginning, feeling “like the artist’s own vision, was, in fact, questions in his paintings of objects and someone who arrived in a country where rooted in Impressionism but with none the relationship between interiors and he cannot speak the language.” of the prettiness. You would never say windows as boundaries seperating inner But, as the “Early years, 1895–1909” Matisse’s work is relaxing to look at. and outer space. section of the exhibition shows, after From 1906 onwards, he combined This concern with fundamental aspects visits to the painters Paul Signac and intense color with decorative patterns of painting and sculpture give Matisse’s André Derain in 1904 and 1905 in and flattened forms in a style that grew work a rigor and toughness that makes progressively simpler. For me, this is where the sun-drenched south of France, he the experience of wandering through committed himself to color. it’s possible to see a connection between this superb exhibition far more than a From 1910-17, the period covered by Matisse and Hockney who also uses surrender to an orgy of color. the “Fractures and Windows” section of intense color and dramatically simplifies the exhibition, Matisse’s work became the human form in a painting such as the more radical and avant-garde. His splendid “Afternoon Swimming.” Find out more about Henri conviction that this was the way for him When Matisse moved to Nice on Matisse: The Color of Ideas was reinforced by visits to the studios of the French Riviera in 1917, his work at www.szepmuveszeti.hu. “Interior, Goldfish Bowl” (Intérieur, became less intense. During the 1920s, artists including Picasso and Juan Gris, bocal de poissons rouges), 1914 he was embraced by the establishment who made Cubist work for a time.
5
www.bbj.hu
Budapest Business Journal | July 29 – September 8, 2022
Socialite | 27
Perusing Portugieser, the Lighter Summer Tipple While the fullbodied, tannic, muscular red wines of Villány might be a bit of a challenge to imbibe in the heat of summer for some, those made from the Portugieser grape in the region, with their lighter structure, can offer pleasant respite. ROBERT SMYTH
The blends of Villány’s RedY brand, which are zesty fruit bombs built on a backbone of Portugieser, are a good option for those who still want to enjoy red wines in summer; their light tannins mean that they can be lightly chilled in the fridge. The predominantly tank-made, bistrostyle RedY wines are designed to appeal to Generation Y. However, I’m sure there are many from Gen X and even older who will appreciate these offerings that slip down with ease, or, as they say in the trade these days, wines with good drinkability (shouldn’t all wines be drinkable?) For the most part, wines made from the early-ripening Portugieser variety, like Bock’s Porta Géza, are intended to be consumed young, as soon as for the festivities of St. Martin’s Day on
November
11.
Incidentally, winemaker József Bock coined this moniker when he couldn’t get used to the new name for the variety. It was originally called Kékoportó or Oportó, but the EU decreed it be changed due to its closeness to the fortified port wine of the Douro in Portugal. This works both ways, though. In the French region of Alsace, Tokay d’Alsace, the old name for Pinot Gris had to be dropped, as did Tocai Friulano in Fruili in northeast Italy (now the Friulano grape) and Tocai Rosso in Veneto, which has become Tai Rosso and is the local name for Grenache (Noir). Despite its name association with Portugal, most experts believe that the grape originates from somewhere close to the River Danube, in a Germanspeaking area. Wines of Germany says it probably hails from the Danube Valley, while Wines of Austria believes it likely
comes from Austria. Wines of Austria does, however, mention that the variety is identical to Português Azul, which is grown in the Alentejo region of Portugal.
Swabian Influence
Portugieser was probably brought to Villány by German (Swabian) settlers, whose descendants continue to make wines in Villány today: the names of Bock, Gere, Günzer and Maul are all Swabian in origin, and they often speak a dialect of German to each other, rather than Hungarian. Attila Gere makes an impressively zesty, organic, single-vineyard Portugieser when the vintage permits, from the steep, stunning south-facing Ördögárok (Devil’s Ditch) vineyard, which, legend has it, was plowed by the devil. Breezes often blow through the vineyard, which helps against fungal diseases, enabling organic wines to be made. The 2021 vintage costs HUF 2,450. Attila is the cousin of Tamás Gere, who makes wine with his son Zsolt at the family winery, Gere Tamás és Zsolt. Its RedY wines are released under Zsolt’s name, befitting its Gen Y profile. The fruity and lively 2020 is a blend of Portugieser (60%) and the indigenous Kékfrankos (30%) and Kadarka (10%) grapes. It
costs
HUF 1,990
from geretamas.hu. On a recent trip to the VilIány wine region, guiding American visitors
through several big red wines (which, incidentally, they loved despite the heat), it was a real experience to find some older vintages of Portugieser knocking around at Jackfall Bormanufaktúra and from a single vineyard to boot. Jackfall is located in the village of Jakabfalva. Its winemaker, András Kőszeli, who trained in Tuscany and California, is a big fan of Portugieser and feels it is a grape that should be aged to reveal its best qualities. Jackfall’s Premium Portugieser (both vintages mentioned here cost HUF 4,190 from the cellar) comes from the Gesztenyés vineyard in Kisharsány and were aged in seconduse oak barrels. The 2018 exudes aromas and flavors of sour cherries, strawberries, red berries, black pepper and other spices, with lovely light tannins and a beautifully balanced finish, with perfectly integrated 13% alcohol and acids. The description almost reads like a Pinot Noir note, with all that crunchy red fruit, and Pinot can sometimes be spicy, too. I never thought that “plain old Portugieser” could ever remind me of noble Pinot Noir!
Frequently Found
The Pinot comparison became even more marked when the pale ruby-colored Gesztenyés
Portugieser 2013 hit the glass, with its earthy character to go with the still buoyant red fruit, which also included some rosehip. That note is frequently found in Kadarka, often dubbed “the Hungarian Pinot.” Also light in tannins and very often spicy, Kadarka is another cooling option for a summer red. Kőszeli was a study buddy of mine when we were both taking the Wine and Spirit Education Trust level four diploma. I was impressed with his inquisitive, active mind, which revealed considerable knowledge and an openness to new ideas. This manifests itself in his contemporary, fruity wines of good concentration and balance that appeal to international palates. Besides the beautifully balanced wines from Bordeaux varieties, including a Villányi Franc, the Kékfrankos here is also classy, exhibiting some of the black fruit that this Carpathian basin variety can capture in a warmer climate, in addition to the usual red fruit typical of the type. The New Year brought the tragic news that Jackfall’s co-owner Gábor Jandrasics and Ottilia Burger were killed in a car accident. Both were marvelous hosts when I guided guests on tours there and are sorely missed. However, I am pleased to say that Gábor’s daughter Borbála, who I also studied with for the WSET, has successfully taken on the reins of Jackfall. The winery cultivates
13.5 hectares
in Kisharsány and Nagytótfalu and has charming apartment accommodation, sleeping up to 55 people. Jackfall was once again buzzing with positive energy on my recent visit. Discussing Portugieser in Villány, the German biodynamic brigade of Wassmann and Horst Hummel must be mentioned. Susann Hanauer and Ralf Wassmann, whose winery is certified by Demeter, were initially intrigued by legendary wine writer Hugh Johnson’s comments that the best Portugieser is to be found in Villány. Hanauer studied law at the same German university (Tübingen) as Hummel, but they didn’t meet despite being there at the same time (she started as he was winding down) until their paths crossed in Villány. The trio are not only pioneers of Portugieser but also of natural wines, using the now über popular noninterventionist style, long before the term became part of everyday parlance.