Interview: ‘hands-on’ style pays off

Office Market

S IMMO Country Manager Katalin Sermer discusses her firm’s activities in Budapest.

S IMMO Country Manager Katalin Sermer

How many properties are you handling in Budapest?  

S IMMO AG’s portfolio in Budapest consists of seven office buildings of which two are located on the Buda side and five on Pest side, plus the Hotel Marriott Budapest. Our asset and property management company S IMMO APM Hungary takes care of these properties. We let the vacant areas, perform full property management of the office buildings, and we plan and execute investment projects on all of them including the hotel.

Are there any particularly interesting properties you would like to highlight?

Our portfolio is largely diversified – smaller to large buildings, rented premises ranging from 20 sqm to 14,000 sqm, lease lengths between one and 15 years, single tenant building to multi-let with 50 tenants, and so on. They are all different and interesting, full of challenges and much success.

Budapest’s office market is heating up, with few vacancies and not much development in the pipeline. How is your business impacted?

We have made large investments in our buildings over the last two years, to be ready for the awakening interest. This approach proved to be successful and resulted in extending contracts as well as concluding many new lease agreements. It is the core strategy of our mother company, S IMMO AG in Vienna, to anticipate the real estate cycles and to take advantage of them. I am furthermore convinced that S IMMO’s style of negotiation, our “hands-on” management and close relationship with our tenants are also paying off.

Given the busy market, are you actively looking at acquisitions here?

S IMMO AG is invested in Austria, Germany and six countries in Central and South Eastern Europe. Its plans for acquisition, developments and investments are always targeted toward all regions. At the moment new projects are under way in Vienna, Germany and Bucharest. These schemes were prepared in previous years and we will be happy to support any new projects in Budapest if and when those are decided upon.

Can you see the possibility to create some class “A” office vacancies by upgrading existing properties that you have or can obtain?

S IMMO Hungary’s office buildings have seen continuous upgrading and increasing occupancy. Most of the technical and visual renovation works finished by the end of last year. This year has already brought a number of major lease agreements. I strongly believe that upgrading properties – especially in prime locations – is a crucial factor of being successful in Budapest nowadays.

What kind of advice are you giving potential partners about assets in this market?

Assets on the Budapest market are to be maintained to a high level and the personal touch is also very important.

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