Hungarian developer SCD Group acquired a 12.6 ha development site for HUF 6.85 billion (€24.6 million) in the heart of downtown Buda, the prime residential area of Budapest. The acquisition was financed by MKB Bank, the Hungarian subsidiary of Bayerische Landesbank.
SCD Group acquires the last major development site of the 2nd district of the city following a tender issued by the local municipality last autumn. According to SCD Group's plans favored by the municipality a large-scale mixed-use development shall take place on the site creating a new hub in the district. SCD Group intends to meet the increased demand in the area for A-category offices, retail, sport and leisure facilities and also aims to create the districts largest underground parking facility.
Speaking of the transaction Mr. Gábor Tomcsányi, SCD Group CEO said that considering current market circumstances securing the financing for the acquisition is regarded as a huge success, highlighting the potential residing in the planned development scheme.
The site was formerly operated as military offices and school, making zoning modifications inevitable. Pre-development planning work is thus expected to take at least two years.
With total development costs estimated at €200-250 million the project may clearly become one of the most significant real estate development projects in Budapest. SCD Group intends to further analyze market and financing conditions before making its decision on whether to invite any co-investor.
Source: SCD Group