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CET opening nowhere in sight as accusations continue to fly

The turmoil surrounding the Central European Time or CET cultural and retail venture in Budapest is by no means abating, as the developer and the municipality still accuse the other of delaying the grand opening.

“The project is 97% complete, what is missing is the authorization to install the public utilities, which the municipality has yet to issue,” Imre Márton, owner and general manager of the developer Porto Investment told reporters earlier.

CET spans a 27,000-square-meter plot near Szabadság híd, set to accommodate a mix of hospitality and retail tenants along with cultural facilities and art galleries. It is being built for an aggregate budget of HUF 8.5 billion under a public private partnership (PPP) construct which has been challenged by Budapest deputy mayor Gábor Bagdy. The official said that the investment is progressing in an arrangement that is“rather obscure and is not necessarily beneficial for the city of Budapest”.

A little more than a month later Porto motioned a review of the contract itself, saying that Bagdy has not divulged any specific objections and that the municipality is delaying the progress of the investment without any acceptable cause. The claim has been submitted to the National Development Ministry’s department overseeing priority state contracts and subsidization arrangements.

Porto’s communiqué on the issue points out that Budapest has refused to cooperate despite making numerous promises to do so. It also claims that the local government has not responded to an assembly decision mandating the review of certain contracts in November which in turn has prevented several rental agreements for CET to be signed. The success of the investment is also obstructed by Budapest’s refusal to jointly promote CET which would greatly boost tenant and visitor interest, Porto said. Márton said the building is 60% let with the goal of raising the figure to 75-80% by the opening.

“We were shocked to learn that Porto Investment Hungary Kft […] is putting the blame on the Budapest municipality,” Bagdy responded to the filing in a statement. He categorically refuted the allegations that it is the officials who are hindering the grand opening and attributed the delays to Porto’s own negligence in conducting the related installation works.

CET is almost a year behind schedule, as it was supposed to open last August. Currently, Porto is hoping for a late spring opening, which could possibly revised to early autumn, since a summer launch makes little business sense.

Bagdy also rebutted the charges that Budapest would in any way be responsible for the delays in signing rental contracts and noted that Porto has repeatedly canceled talks to be held on the issue.

“It would appear that Porto Investment Hungary Kft is trying to distract the public’s attention from the defective performance of its own obligations by making unsubstantiated accusations,” Bagdy concluded.