Renovation of Krausz Palace Approaches Completion

Office Market

The renovated facade of the palace (top) and its state before restoration (bottom).

The modernization of the Krausz Palace on Budapest's Andrássy út is nearing completion, according to a press release sent to the Budapest Business Journal.

The palace, acquired in 2019 by investment manager AEW on behalf of its clients, is attracting a lot of interest - particularly from high-end luxury brands as well as companies within the Hungarian tech sector who are increasingly seeking prestigious, central locations.

Close to the Hungarian State Opera House, Krausz Palace is a defining feature of Andrássy út with its turn-of-the-century architecture. It is now being relaunched as a state-of-the-art high-street retail and office asset, with completion foreseen for the end of January 2023 following a year-long renovation. 

"Our main task during the renovation was to safeguard the invaluable heritage features of the building, including the ceiling paintings of Károly Lotz and the beautiful façade, whilst providing a top-of-the-range modern 'A' class retail and office building," Jake Lodge, principal of Avison Young Hungary responsible for the renovation project, said. "Renovating a heritage building has had many challenges, including undoing numerous changes inflicted on the building over the years, removing entire floor slabs, and replacing the building's mechanics with efficient modern systems, thereby transforming Krausz Palace into a commercially viable and premium commercial property fit for modern businesses." 

"We are seeing significant interest for both the office floors and the ground floor retail space. It may sound surprising, but in addition to the embassies, financial and legal firms that are used to search for offices in this area, thriving tech companies seem to have an incredible hunger for premium downtown offices like Krausz Palace – they would prefer to move to the Andrássy út office building, which offers much more prestige and proximity to the city center, rather than office buildings located on Váci út," Lodge added.

"We do not take any shortcuts when it comes to carefully repositioning such a prestigious building in the heart of Budapest. In order to provide our future tenants with a combination of modernity and historic tradition, we did not shy away from hand-picking materials and selecting specialized architects while targeting a 'Breeam Excellent' certification to ensure the asset's long-term attractiveness in the local market," he noted. 

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