Office properties continued to be both the most abundant and attractive investment assets on the Hungarian commercial real estate market in 2020, according to DLA Piper Hungary’s latest annual report.
The annual real estate market analysis of DLA Piper Hungary shows that investor confidence in office properties remained unbroken in 2020 and accounted for 60% of the firm’s transactions. The vast majority of these office transactions involved Class A office buildings in central locations of Budapest: the law firm states that they will be important long after the COVID-19 epidemic as a workplace and as an investment asset, according to market participants.
Due to the challenges and uncertainty caused by COVID-19, the investment volume decreased by 20% compared to 2019. However, the Hungarian commercial real estate market continued to attract domestic and foreign investors. Although it was expected that COVID-19 would make it harder for foreign investors to transact and domestic investors would have an advantage, the market share of domestic investors dropped in 2020 to 61% from 72% in 2019.
„The arrival of the pandemic in March 2020 affected the entire Hungarian real estate sector – however, it had vastly different effects on the different market actors and asset classes. During the transactions we managed, we saw a virtually instant disappearing of investor interest in retail and hospitality related assets, while logistic and industrial properties came into the focus,” said Szilárd Kui, Local Partner and Head of Real Estate at DLA Piper Hungary.
