User expectations have changed significantly during the past couple of years and this is a challenge that most landlords do not take lightly. Mátyás Gereben MRICS, Country Manager of CPI Hungary talked to Property Forum about the changing needs of office tenants and the shopping centre of the future.
Most market players think that we have reached the peak of the current property cycle in Hungary. Do you agree with this view? Do you expect to see further market growth in the next 12 months?
If I had to place the current property cycle on a clock I would say we are at 11.30. Some yield compression might happen in prime segments but there is seemingly limited flexibility in this regard.
CPI has renovated and repositioned a number of office buildings in recent years. Can these buildings fully compete with newly built ones?
During our refurbishment projects, we use strictly high-quality design and materials which means that our renovated buildings don’t differ significantly from newly built ones. We have invested a significant amount of money into upgrading the HVAC and other mechanical systems to provide ultimate comfort to our tenants. Furthermore, the design process already takes into consideration the requirements of green accreditation and, thus, we have already incorporated many features such as bicycle racks, shower facilities, rainwater collection systems and disabled accessibility, among others, into the plans.
The interesting part was using sustainable solutions during construction, such as special waste management, building materials and establishing sustainable working condition for the construction workers. For CPI, sustainability has become a vital issue as we have entered into the bond market and this is an important KPI for our bond investors.
What are the most significant changes you’ve observed in the needs of office tenants over the past 2-3 years? How are you addressing these changes as a landlord?
3 years ago tenants simply wanted an office building but today they are requesting a human-focused working space. This is a big change and CPI is a pioneer in innovation as we have been focusing on establishing a community in our buildings. For example, we launched user-centred Human Innovation Program services at our office buildings and we are now launching a community builder application that connects tenants to amenities.
In terms of changing user demand, the retail sector has gone through an even larger transformation than the office market. What are the main trends you’re addressing through the renovation of the Campona shopping centre?
Entertainment, F&B selection, social and cultural meeting place, healthy and sustainable environment – these are the keywords that drive us as we create the shopping centre of the future. We envisage Campona as the first lifestyle centre in Budapest that will be inspirational and offer ideal conditions for family outings with shopping and leisure-time activities.
Are you also working on new concepts for other retail assets, such as Pólus Center?
Yes, we are committed to follow the trends and to monitor customers’ needs and which means that we’re constantly coming up with new ideas for Pólus Center and for our retail parks as well.
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