Building a ‘Living Environment’ Around Foka Bay
Duna Terasz Grande CEO and property manager Csaba Tóth talks to the Budapest Business Journal about an ambitious development close to the District XIII waterfront.
BBJ: The Duna Terasz Grande project is said to have the largest number of apartments built in one spot at one time. What are the numbers that back that up?
Csaba Tóth: A total of 790 apartments and 19 retail premises will be built in two buildings at the same time, which is unique in this category. The project is executed on an area of two hectares, which can be considered outstanding in itself, but in terms of apartments’ numbers, we can talk about a large investment. The Duna Terasz Grande is also the largest development close to the waterfront in District XIII; its area stretches from Úszódaru utca to Csele utca, bordered on one side by Kelén utca and on the other by Cserhalom utca. The previous two residential buildings of the Duna Terasz Residential Area were built with a smaller number of apartments: 362 flats in the Duna Terasz Residential Park, handed over in 2009, and 322 apartments handed over in Duna Terasz Premium in 2019.
BBJ: When did work start, and when will it be completed? Is there any particular reason it is going ahead now?
CsT: Duna Terasz Grande is our third phase, and preceded with careful planning. The actual construction works started before the sales period, in April 2020. Sales began in early January 2021, and delivery of the building is expected in March 2023.
BBJ: How are sales going? When will the first owners move in?
CsT: The sales period was divided into two phases: From the 464 apartments offered for sale in the first period, we sold 164 apartments in the first two successful months. This is more than 35% of the current phase and more than 20% in terms of total development. As I mentioned, the handover of the building is expected by March 2023, so we are waiting for the first residents of the Duna Terasz Grande to move in soon after.
BBJ: Have there been any particular challenges working on the project during the pandemic? Have these affected costs and/or timing?
CsT: The planning and permitting process was completed before the pandemic. So far, we have not seen the impact of pandemic either on sales or on construction works. Our sales team is prepared for any situation: if personal administration cannot be managed due to the pandemic, the customers can be informed about the details of the project with the help of online conference programs, even with a 3D model, and the booking of the apartments and the conclusion of the registration contracts can also be done online.
BBJ: Do you have any data or idea about how many owners will buy their primary home, and how many will buy as an investment?
CsT: Typically, investors buy in the early life cycle of a development. They are the first to move, making quick decisions in the hope of later economic gain or price increases. Customers of Duna Terasz Grande are different. Based on two-months’ experience, the rate of buyers for investment and for move-in is mixed. Customers of our previous projects would like to move to a larger home, and many new buyers imagine their future life in this residential building, thanks to the carefully planned layouts of the apartments. This, I think, is a positive feedback on our previous phases: we have managed to build a loyal, satisfied customer base. Buying a home is a matter of trust: in Hungary, there is a much greater willingness to own a property than to rent it, so it is essential to develop a relationship of mutual trust with our customers.
BBJ: Why is Duna Terasz Grande unique, aside from its size? Why should a potential homeowner choose this project?
CsT: The main feature of any development is the location. Duna Terasz Grande is built in one of the unique locations in Budapest: on the riverside part of the popular District XIII, one street from the port and within easy reach of the Danube promenade. In addition, it is an infrastructurally constantly developing area: underground, public transport, bicycle path, close to a shopping center and restaurants.
Grande can be convincing with its technical content, too: green solutions, smart home, first-class materials and community services: communal toolbox and sports equipment storage, yoga, sunbathing and barbecue terrace, and reception services.
I think it is important to emphasize that the partners of the D&B Real Estate Development Group are capital-strong. The general contractor of the project is Kész Építő Zrt., while OTP Bank is supporting the Duna Terasz Grande development by providing a HUF 23 billion loan, which is Hungary’s largest project financing loan to date for residential development.
From the financial point of view, the discounted 5% VAT and the possibility of the Family Housing Allowance Program (CSOK) scheme could also have a favorable effect on potential homeowners; in addition, OTP Bank, as our financial partner, offers customers a free convenience service.
BBJ: What is the background of D&B Real-Estate Development Group, the company behind Duna Terasz Grande?
CsT: The D&B Real Estate Developer Group was established in 2008 in Hungary as the subsidiary of an international financial investor group.
At that time, we purchased the semi-finished building of the first phase’s as well as the nine-hectare area on the bank of the Foka Bay. D&B Real Estate Development Group business and marketing professionals all have at least 15-20 years of experience in the field of residential real estate development. Experience in real estate also plays a prominent role in the project’s technical team; we have colleagues who have more than 50 years of experience.
BBJ: What is next for Duna Terasz Grande and for D&B?
CsT: We are developing in one of the most excellent locations in Budapest. Our first goal is to complete the Duna Terasz Grande residential building in the first quarter of 2023; in addition, we are already planning further residential projects in this area. Our long-term vision is to create a living environment around Foka Bay that harmonizes with the environment, the needs and ideas of our customers. Due to our cooperation with the municipality, the infrastructural environment of the area will definitely improve: the roads will be renewed, Foka Bay will be reborn for recreational purposes, and we will also create a running track.
This article was first published in the Budapest Business Journal print issue of March 12, 2021.
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