GTC Delivers White House Project

Office Market

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

GTC White House.

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

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

“We are focused on office and shopping centers,” says Thomas Kurzmann, CEO of GTC. “With regard to the office asset class, one of the main recruitment drivers for international companies in CEE where there is full employment and a shortage of skilled labor is the quality of office they provide. We therefore help our tenants create an environment where staff are happy to come every day and there are pleasant places to eat and relax. On top of this, one of the biggest drivers is energy costs efficiency and therefore we have provided high recovery ratios for heat energy at White House in winter and cooling systems in summer. White House is very important for our group because we have integrated the environmental system in the new modern building and the heritage part of the project. It took us a long time to get the right system implemented,” Kurzmann explains.

A significant letting has been concluded with BlackRock and the asset manager will take occupancy in July for use as its innovation and technology center. According to on-going negotiations, the remaining space could be 100% occupied by the third-quarter of the year, GTC says. As is the norm across its portfolio, GTC has a 60% loan-to-value ratio on the White House project.

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

Speculative Projects

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

With delivery of White House, GTC has extended its Budapest office portfolio to 140,000 sqm. The CEE-based company has a policy of maintaining its developments within its own portfolio on a long-term basis and actively manages 42 buildings, providing 700,000 sqm of lettable office and retail space in Belgrade, Bucharest, Budapest, Poland, Sofia and Zagreb.

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

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

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