Report Points to Increased Risk on Commercial Real Estate Market
Last year's economic contraction added to cyclical and structural risks faced by Hungary's commercial real estate market, but lenders' resilience remained strong, with their balance sheet exposure in the market less than half of that after the 2008 crisis, the National Bank of Hungary said in a report published on Thursday, according to a report by state news wire MTI.
Only the hotel segment showed any improvement in 2023, supported by the higher number of foreign tourists to Hungary.
Take-up on the office market was down about 10pc from the average in 2015-2019, and the vacancy rate reached 13.3%, up 2 pp from a year earlier. That rate is expected to climb further as total office market stock is set to climb 9.4% by end-2025 as projects in the pipeline are completed.
On the industrial and logistics property market, handovers reached a record volume in 2023, and the vacancy rate climbed by 4.8 pp to 8.6%. Stock in the segment is set to climb by 9% in 2024.
Commercial real estate investment volume fell 38% to EUR 0.6 bln in 2023, the report shows. Domestic investors accounted for 82% of that volume.
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