Once completed, which is due in Q1 2027, it will offer more than 22,000 sqm of office due for completion in the first quarter of 2027.
There is a clear and growing demand in Budapest for high-quality, well-located office space that meets modern ESG expectations. Companies are becoming more deliberate in their workplace decisions, and that is especially evident when seeking larger, contiguous spaces that can support long-term business needs, talent attraction and future flexibility, says Aurelia Luca, executive vice president of operations for Hungary and Romania at Skanska Commercial Development Europe.
The low level of speculative office pipeline in Budapest is widely predicted to result in a reduced supply of quality, well-located, ESG-compliant properties, despite rising overall vacancy rates. Analysts argue that only the best-designed, most sustainable and well-located developments will succeed in a rapidly changing, ever more demanding Budapest office market.
“Pre-lease requirements remain strict, with bank financing typically requiring 30–50% pre-let occupancy levels. In today’s conservative market environment, the landlord’s track record is the most valuable asset. Tenants are far more likely to commit to a pre-lease agreement with a developer that has a proven community-centric operational model,” says Zita Kovács-Bertók, office development director of CPI Hungary.
Development activity in Budapest remains dominated by government-led built-to-suit projects, with a remarkable 83% of the 472,000 sqm under construction tied to BTS schemes. Vacancy rates are expected to rise, and the current cycle clearly favors repositioning and repurposing of existing assets to meet evolving occupier demands, says consultancy Cushman & Wakefield.
The two most recent deliveries were two BTS projects at the mixed-use BudaPart development by Market Asset Management, which offered 42,000 sqm of space for government-related projects.
“The Budapest office development pipeline in 2026 remains relatively limited, reflecting a cautious approach from developers and a continued lack of speculative construction. There are very few upcoming schemes that are either pre-leased or have been postponed, which is likely to result in a tightening supply of high-quality, Grade ‘A’ office space in the medium term,” comments Valter Kalaus, managing partner of Newmark VLK Hungary.
Cushman & Wakefield has traced 17 office projects scheduled for delivery by 2027, of which only three are speculative. One of this trio is the Centerpoint III project by GTC on Váci út, which is due to bring 35,000 sqm of space to the market. There is a diminishing supply of well-located development sites in the Váci Office Corridor, which has long been considered a prototype for urban redevelopment in Budapest.
Total Budapest office stock stands at approaching 4.5 million sqm according to the Budapest Research Forum (which comprises CBRE, Colliers, Cushman & Wakefield, Eston International, iO Partners and Robertson Hungary). Of that, around 3.6 million sqm has been developed on a speculative basis. Within the Central and Eastern European region, Budapest remains the second-largest office market after Warsaw.
Overall vacancy stands at 12%, although this is expected to fall as new supply dries up. CBRE sees vacancy rates rising to 15% by the year-end and further pressure on overall vacancy rates as public sector authorities vacate more than 220,000 sqm of older stock.
The quality divide in the office market is increasingly clear: older buildings have an overall vacancy rate of 10%, while vacancy in newer office complexes has fallen to 6.4%, according to Cushman & Wakefield.
The overall vacancy rate includes obsolete offices that are not of the required standard to meet contemporary demands and could, in effect, be removed from the equation. In many cases, owners will face a “refurbish or reposition” decision. Less competitive buildings risk obsolescence or conversion to alternative uses, according to Valter Kalaus, managing partner of Newmark VLK Hungary.
“A clear two-tier market is emerging, with strong occupier demand focused on modern, ESG-compliant buildings, while older, non-compliant stock is experiencing increasing vacancy and downward pressure on rents,” he says.
The absence of newly announced projects reflects the cautious market approach, a trend evident across the CEE region and wider Europe. A notable consequence of this is that Budapest is seen as facing a significant quality supply-demand imbalance, as offices less than five years old account for just 17% of total supply.
Apart from the aforementioned state-ordered construction, there is practically no ongoing office development in Budapest, and overall supply will likely remain stable for some years to come. Even so, there are signs of the office market awakening, with an increasing share of relocations and net absorption.
Any new speculative development will need to be in line with ESG requirements and of the quality demanded by the market. Existing older stock will require extensive upgrades and redevelopment to reach these standards. In general, successful developments will be more ESG-compliant, better-designed from an exterior and interior perspective, and more conducive to a favorable work environment.
“The market has entered a new phase where ESG compliance, EU taxonomy alignment, and sustainability certifications are no longer optional in office and industrial developments. Investors, lenders, and major occupiers now expect buildings to meet stringent environmental and social standards, making sustainability a fundamental requirement rather than a competitive advantage,” says Zsombor Barta, founding partner of Greenbors Consulting.
“The new demand indicates a shift towards more contemporary offices and locations. Overall demand for these types of spaces is reinforced by the fact that, within the class ‘A’ category, and for buildings less than 10 years old, the vacancy rate has remained below average. We anticipate a more substantial upswing in vacancy rates within the class ‘B’ segment due to the incentive for tenants to transition […] to higher-class, ESG-compliant, more energy-efficient spaces,” adds Colliers.
This article was first published in the Budapest Business Journal print issue of May 22, 2026.
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