Budapest Business Journal 2913

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BUSINESS JOURNAL BUDAPEST

VOL. 29. NUMBER 13

JULY 2 – JULY 15, 2021

SPECIAL REPORT Tourism

SPECIAL REPORT

Domestic Guests to Drive Tourism Recovery Amid Labor Shortage Fears Labor shortages remain a central problem for the COVID-ravaged tourism industry but travel restrictions abroad and a strong interest in domestic holidays mean the sector may yet close a successful season. 13 U.S. COUNTRY FOCUS

Developing Relations, Building Connections, Sharing Knowledge AmCham Hungary president Zoltán Szabó discusses the inheritance of the chamber’s American roots and the impact those still have on its work today. 10

Turkish Delight

SOCIALITE

Budapest Art Orchestra Performs on Moby Album When it came time to look back over a career in music that spans three decades, superstar musician and DJ Moby had no intention of simply putting together a conventional greatest hits package.

Enter the Budapest Art Orchestra, stage left. 26

NEWS

MNB 1st in EU to Start Tightening As expected, the Monetary Council of the National Bank of Hungary (MNB) raised its base rate to 0.9% for the first time in a decade at its latest rate-setting meeting, with the 30-basis-points increase slightly exceeding market expectations. 3

BUSI

N E SS

Daniel Korioth, the head of the Bosch Group in Hungary and the Adria Region (and a nominee for the 2021 BBJ Expat CEO of the Year award) is leaving the country to become the president of Bosch Turkey and its Middle East representative. He Looks back on his five years here.  6 BUSINESS

Borsodi Debuts Hard Seltzer in Hungary Borsodi Brewery marketing director György Spiegel talks to the Budapest Business Journal about introducing its hard seltzer to the Hungarian market and beer innovations. 8

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News THE EDITOR SAYS

EDITOR-IN-CHIEF: Robin Marshall EDITORIAL CONTRIBUTORS: Kálmán Béres, Zsófia Czifra,

Kester Eddy, Bence Gaál, David Holzer, Christian Keszthelyi, Gary J. Morrell, Nicholas Pongratz, Gergely Sebestyén, Robert Smyth, Bálint Szőnyi, Zsófia Végh.

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BBJ-PARTNERS

When the Euro 2020 soccer championship was postponed last year amid the COVID crisis, it must have been heartbreaking for the organizers. But its rescheduling now feels like a moment of serendipity, at least from the perspective of the national mood. Restrictions have been eased, the sun is shining, and public entertainment is back.

Whether you call it soccer or football, it is the “beautiful game” because it is the easiest ball sport to understand, leaving arguments about the off-side rule to one side. Any sport played in an empty or near-empty stadium lacks atmosphere. So to see it played again in front of packed houses has been a dramatic reminder of the passion and drama crowds bring. For however good the skill on display on the field of play, it is the crowds in the stands that turn a match into an occasion.

If packing 60,000 people into the Puskás Aréna was a sensible thing to do, from a public health point of view, only time will tell. (Certainly, Finland has suggested an uptick in COVID-cases due to fans attending two matches in Saint Petersburg.) The Hungarian authorities will undoubtedly point to the success of the vaccination campaigns and say the “risk” is justified. Who knows when Hungary will again get the chance to host European championship games, especially with their team competing.

That, alongside the Prime Minister’s well-documented passion for soccer, perhaps made it inevitable that this was an opportunity that would be seized.

It helps, of course, if the host nation (technically, one of the host nations) is competitive. Hungary has not been a world power in the sport for many years and was drawn in the inevitable “group of death” that every

championship seems to throw up. Yet the Hungarians held reigning European champions Portugal for 84 minutes before conceding three goals late on. Far from being dismayed, however, they took the lead against France and took the world champions to a credible draw. (The atmosphere in the Budapest stadium was variously described as “electric,” “frenzied,” and “bedlam.”) Hungary did the same to Germany, away in Munich, and was six minutes away from knocking them out. As an aside, this truly was the group of death: not one of the four teams progressed to the quarterfinals. Given the pedigree of the three major teams involved, that is a surprise.

Hungary has felt good about itself as a footballing nation in a way it has not done for a while, which generally translates to an increase in spending. Before the championship kick-off, sports data website Pitchinvasion.net predicted Budapest would generate EUR 20 million during the tournament, behind only Saint Petersburg and London. It will be interesting to revisit those figures after the event. The money is generated in all sorts of ways, of course, from the sales of championship merchandise to replica shirts to beer. Interestingly, two wine bar owners we spoke to this week reported an uptick in sales from French, Portuguese, Czech, and Dutch fans. Perhaps new aficionados of Magyar wine have been won. Hungary’s sporting journey in Euro 2020 is over.

It seems safe to assume the economic rebound will continue for a good while longer.

Robin Marshall Editor-in-chief

Photo by Fortepan / József Kovács

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MAKING THE MOST OF THE ‘BEAUTIFUL GAME’

THEN & NOW

Attila Fiola, of the Hungarian national team, scores against France in the Euro 2020 Soccer Championships on June 19.

Although Hungary finished last in its group, the draws with Germany and France surprised fans internationally, and marked the team’s performance as a success. The black and white image from the Fortepan public archive shows the Hungarian “Golden Team,” including the legendary Ferenc Puskás on the far left, lining up on November 25, 1953 before the so-called “Match of the Century” when Hungary defeated England 6 to 3 at the old Wembley Stadium in London, England.

Photo by MTI / Tibor Illyés

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Budapest Business Journal | July 2 – July 15, 2021

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Budapest Business Journal | July 2 – July 15, 2021

News///macroscope

MNB 1st in EU to Start Tightening Cycle

As expected, the Monetary Council of the National Bank of Hungary (MNB) raised its base rate to 0.9% for the first time in a decade at its latest rate-setting meeting, with the 30-basis-points increase slightly exceeding market expectations.

CHANGE IN GROSS DOMESTIC PRODUCT IN HUNGARY, 2010-Q1 2021 Annual economic growth rate

Seasonally and calendar adjusted and balanced data

at

1.25%

at the end of this year and 1.5% from next March.

Dávid Németh, head analyst at K&H Bank, thinks that the next rate hike might happen as soon as July, followed by 15-basis-points steps afterward.

Quarterly change in GDP, 2010-Q1 2021 Seasonally and calendar adjusted and balanced data

“With the recovery set to strengthen and inflation likely to increase further in the coming quarters, we expect additional interest rate hikes in the second half of this year.”

ZSÓFIA CZIFRA

With the move, Hungary became the first country in the European Union to start a cycle of rate hikes to deal with the mounting price pressure in the pandemic’s wake.

The central bank also decided to phase out its program to provide cheap corporate loans but confirmed that it would keep its government bond purchases in place. It will also launch instruments supporting environmental sustainability, it said.

The move slightly exceeded expectations as the market was expecting a 25-basis-point increase.

The MNB said it would review the need for more hikes on a monthly basis to tackle price pressures amid a faster-than-expected recovery from the pandemic.

“The Monetary Council will continue the cycle of interest rate hikes until the outlook for inflation stabilizes around the central bank target, and inflation risks become evenly balanced on the horizon of monetary policy,” the MNB said in its statement.

The council left its overnight deposit rate steady

at

-0.05%,

as expected. However, it said it would bring the interest rate on its crisis management instrument, the one-week deposit rate, into line with the base rate.

According to Morgan Stanley analysts, the acceleration of the Hungarian consumer price index CPI will lose its momentum in 2022, so they think the MNB will not modify the base rate after September.

Gergely Suppan of Takarékbank expects further rate hikes in September, December, and next March; however, he thinks that as inflation is likely to decrease from mid-2022, the tightening cycle will end then. Therefore, he expects the base rate to be

Source:

According to analysts, the MNB had no other choice but to act as inflation has kept running above its 2-4% mid-term target, reaching 5.1% in May), and the pressures from the reopening economy kept mounting.

The bank now projects average inflation at 4.1% this year, returning to its 3% policy anchor sometime around mid-2022.

Properly Anchored

“In the Monetary Council’s assessment, it is of key importance to ensure that inflation expectations are properly anchored. Upside risks to the outlook for inflation have generally increased,” the bank said, adding that “sustained rises in commodity prices and international freight costs point to a higher external inflation environment.”

Reacting to the news, economist Liam Peach of Capital Economics noted, “With the recovery set to strengthen and inflation likely to increase further in the coming quarters, we expect additional interest rate hikes in the second half of this year.”

Peach emphasized that the MNB also raised its GDP forecast for 2021 from 5%

to

6.2%,

while the prognosis for 2022 and 2023 was left unchanged, at 5.5% and 3.5%, respectively.

According to Peach, his firm is even more optimistic than the MNB, as Capital Economics expects the Hungarian economy to expand by 6.8% this year, 5.5% in 2022, and 4.5% in 2023.

Capital Economics now forecasts that the MNB will announce 20 basis points rate hikes in September, December, and next March, meaning the current cycle would last until the base rate reaches 1.5%.

Faster Pace

However, the global financial group Morgan Stanley calculates with a faster pace, saying that the MNB might raise the base rate again in July, August, and September, increasing the rate by 15 basis points each time, thus reaching a 1.35% base rate this year.

Analysts at OTP Bank said a rate hike cycle has started, which will last until monetary conditions ensure that inflation can safely return to target and upward inflation risks are mitigated.

“The cycle is based on monthly ratesetting decisions, as opposed to the previous communication on quarterly steps,” the analysts emphasized According to OTP Bank analysts, they expect the size of these hikes to be decided upon a data-driven approach, which could be 10 or 15 basis points.

Numbers to Watch in the Coming Weeks On July 6, the Central Statistical Office (KSH) will publish May retail trade data. The next day, the first estimate of the May performance of the Hungarian industry will come out, and important figures from the troubled tourism sector will also be released. Finally, June consumer prices will be published on July 8.

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News

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Budapest Business Journal | July 2 – July 15, 2021

Mask-wearing Indoors on the way Out Coronavirus ///roundup The government has decided it will ease pandemic restrictions further once 5.5 million people in the country have been inoculated, Gergely Gulyás, the head of the Prime Minister’s Office, said at a weekly press briefing on June 24, according to state news agency MTI.

borders Hungary shares with Austria, Croatia, Romania, Serbia, Slovakia, Slovenia, and Ukraine will be able to get a COVID jab at designated inoculation sites in Hungary.

With inoculations being taken care of and regional support also underway, some have started thinking about summer travel in the area. Hungary reopened its internal Schengen borders from June 24. Since then, two cruise ships have already arrived in Hungary, the first since September, government spokesperson Alexandra Szentkirályi said in a video message on Facebook.

Katalin Novák, Minister without Portfolio for Families, holds a press conference after a meeting of the operational corps she heads responsible for the resumption of community life at the Prime Minister’s Office building on Kossuth tér on June 29, 2021. Photo by MTI / Zoltán Balogh.

“Eastern vaccines” from China and campaign. According to estimates from Russia have arrived, Hungary is still the Hungarian Chamber of Commerce receiving the COVID vaccine developed and Industry (MKIK), the government’s Mask-wearing will no longer be required decision to beef up its vaccination rollout by by Pfizer and BioNTech on a nearindoors in most areas, and immunity weekly basis. Some 350,000 arrived on including jabs from China and Russia, as certificates will not be mandatory for stays well as from a joint European Union order, June 16, another 500,000 on June 23, at hotels, dining indoors at restaurants, saved the country “at least HUF 600 billion.” then another 500,000 on June 29. The and visiting baths, Gulyás said. As of June latest shipment raises the total amount of MKIK head László Parragh said in an 30, the amount of people vaccinated in Pfizer vaccines received by Hungary to interview with conservative daily Magyar Hungary stands at 5,486,514. more than six million.

Nemzet (Hungarian Nation), “the crisis is With the coronavirus crisis now at the Hungary’s vaccine rollout has proved estimated to have cost the country HUF 15 stage of healthy recovery, the government bln a day. If we calculate that [pandemic] so successful, it feels able to assist other has formed a new pair of operative corps, countries in need throughout the region. restrictions could be lifted some 45-60 one to coordinate economic recovery and days sooner than in many other competitor For instance, Hungary has sent hundreds the other to support the recovery of social countries, thanks to the extraordinary of thousands of coronavirus vaccines to the life; both held their inaugural meetings Czech Republic to speed up its vaccination success of the vaccination program, that on June 15. program. The state has also provided means we saved about 1-1.5% of GDP. Minister of Foreign Affairs and Trade 200,000 Sinopharm vaccines each to That’s at least HUF 600 bln.”

Péter Szijjártó is leading the former corps, Montenegro and Bosnia Herzegovina.

Continued Delivery while Minister for Family and Youth Hungary’s government has even And yet, even as the vaccination rate Affairs Katalin Novák heads the latter. offered to inoculate foreign nationals Hungary’s economic recovery can largely slows down, more vaccines keep pouring in border regions from July. As a result, in. Although the last deliveries of the be attributed to its robust vaccination foreign nationals living along the NICHOLAS PONGRATZ

“The crisis is estimated to have cost the country HUF 15 bln a day. If we calculate that [pandemic] restrictions could be lifted some 45-60 days sooner than in many other competitor countries, thanks to the extraordinary success of the vaccination program, that means we saved about 1-1.5% of GDP. That’s at least HUF 600 bln.”

However, a majority of Hungarians are still cautious about their travel plans.

Some 63% of respondents plan to travel by the end of summer at the earliest, although 51% of those planning to travel in the summer are thinking of traveling abroad, up from 44% at the beginning of last summer. For those planning a trip abroad, half are opting to journey to surrounding countries by car.

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Top Healthcare Executives in Hungary 2021 A behind-the-scenes look at some of the most influential Healthcare Executives in Hungary, their leadership, philosophies and successes.

Top Healtcare Executives in Hungary 2021 is a Budapest Business Journal publication Please forward your subscription request to: circulation@bbj.hu, or order your copy in the webshop at www.budapestbusinessjournal.com

• Provides an essential overview of how Hungary’s healthcare market operates.

• Get an insight into the most significant developments in 2020, and a look at what is in store for 2021.

• Get to know the key personalities in the Hungarian healthcare sector.

• Read personal accounts from the country’s top healthcare executives detailing how they got into the business and some of their proudest achievements, among other things.

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Budapest Business Journal | July 2 – July 15, 2021

Industrial Sector Continues to Thrive The Industrial real estate segment continues to be strong, with Hungary having the lowest vacancy rate in the Central European region.

However, market analysts say more speculative development is necessary for further market growth, particularly in regional cities.

GARY J. MORRELL

Total modern industrial stock in the Budapest area for the first quarter stood at more than 2.4 million sqm, according to the Budapest Research Forum (the BRF, consisting of CBRE, Colliers International, Cushman & Wakefield, Eston International, JLL, and Robertson Hungary). However, there are few, if any, logistics buildings available and an overall vacancy rate of 2.6%. The most significant completion in Q1 was 40,750 sqm of new space at CTPark Budapest East.

CTPark Budapest West.

CTP argued that they are the largest industrial park owner and developer in Hungary at its recent CTP Business Breakfast,

citing

600,000 sqm

of almost fully let space across the country now, with plans for that to rise to 750,000 sqm by the close of the year and to one million sqm by the end of 2022.

The company has eight projects under construction in the Budapest area, Debrecen, Győr, and Szeged. Of the 235,000 sqm CTP currently has under construction, 60% is pre-let; from the 322,000 sqm future pipeline, 9% is pre-let.

Despite the impressive figures, the Hungarian industrial market can be seen as underperforming compared to other major Central European markets.

The Czech Republic, for example, has more than nine million sqm of class “A” industrial space and an overall decreasing vacancy rate of 3.6%.

It can also boast an established market in several major industrial centers such as Pilsen, with 27% of the total product under construction, compared to 20% in the Prague area, according to the Czech Industrial Research Forum (consisting of CBRE, Colliers International, Cushman & Wakefield, and JLL).

News | 5

With regard to development strategies in the current climate of high demand and low vacancy rates, developers are constructing BTS facilities with an additional speculative element.

“In response to the high demand levels seen in 2020, a revival of development activity is in evidence, and an improved level of new space will be delivered in 2021/2022, amounting to nearly 300,000 sqm of industrial space; 37% of the 2021 pipeline is already pre-let,” comments Cushman & Wakefield.

“In response to the high demand levels seen in 2020, a revival of development activity is in evidence, and an improved level of new space will be delivered in 2021/2022, amounting to nearly 300,000 sqm of industrial space; 37% of the 2021 pipeline is already pre-let.”

JLL has recorded 252,000 sqm of space under construction in Hungary with a scheduled handover date of this year, from which

around

Romanian Potential

Romania is seeing development activity reflect its potential as the second-largest country in the CEE region. The stock of industrial space in Romania has broken the five million sqm threshold and will reach around 5.5 million sqm this year, according to CBRE. Gábor Halász-Csatári, head of industrial at Cushman, argues that Budapest is in a similarly strong position to Prague, although lacking the latter’s regional hubs.

50%

is already pre-let. As of the end of the quarter, a total of 60% of space stood vacant and there are only two existing schemes with the availability of more than 5,000 sqm of space.

“New developers are entering the market, which strengthens the completion. HelloParks entered the market in 2020, and Panattoni announced its Hungarian expansion in 2021 with two projects in the pipeline,” says JLL in its “Budapest City Report Q1 2021.”

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Budapest Business Journal | July 2 – July 15, 2021

Business

BBJ: What will you miss most about Hungary?

DK: I have an exceptional team in Hungary; they are extremely valuable and competent people and my greatest support here. I will really miss them.

BBJ: Do you have a favorite restaurant or place to visit in the country?

Shaping the Future with our Human Capital

Daniel Korioth, the representative of the Bosch Group in Hungary and the Adria Region (and a short-listed nominee for the 2021 BBJ Expat CEO of the Year award) is leaving the country to become the president of Bosch Turkey and its Middle East representative.

We asked him to reflect on his five years here.

“I think it is essential that whatever country you go to as a representative, you try to get to know as many people as possible, inside and outside the company. You have to talk to your colleagues to get a feel for how to run the business. You have to learn the cultural differences as well.”

ROBIN MARSHALL

BBJ: Firstly, congratulations on the new role. When do you start, and what are your responsibilities?

BBJ: What would be your advice for your successor?

Daniel Korioth: Thank you very much.

I will take over the presidency of Bosch Turkey and the Middle East role from my predecessor Steven Young on August 1.

However, we will start with the handover process from July 1. As the president of Bosch Turkey, I will oversee the company’s operations in the country while also acting as the Middle East representative. I will serve more than 16 markets and more than 18,000 associates.

BBJ: How would you evaluate your time here with Bosch in Hungary? What have been the big successes and (COVID aside) the most significant challenges?

DK: It is challenging to pick one because so many projects I could be proud of have progressed in the recent period.

Of course, this is mainly thanks to our hard-working, persevering colleagues, and I am very grateful to them for their work. But to be specific, the fact that the Campus 2 project (the expansion of our engineering center) got underway during my time as the representative of the Bosch Group in Hungary is particularly uplifting. It will be one of the most advanced development centers in the world. But every Bosch site in Hungary has achieved something definitive and outstanding during the last three years. Perhaps most important is that the Bosch team in Hungary has grown continuously while I have been here.

According to the latest figures we now have more than 15,500 associates.

DK: My wife and I have been living in Budapest; I find this city very handsome, and we enjoy our time here very much.

I cannot mention one place only, since we like everything here. I am impressed

by Matthias Church, for example. We enjoy walking with our dogs on Margaret Island and Óbuda Island and cycling on the streets of Budapest with our eBikes. Whenever we have visited the countryside, I was astonished that, despite its size, how colorful the country is, how many different cultural traits and traditions can be seen all around.

Daniel Korioth BBJ: How has the Hungarian economy changed in your time here?

DK: During my time in Hungary, the economy has improved and developed a lot. This has also helped the growth and stabilization of the Bosch Group in Hungary. We shape the future with our highly qualified and competent associates. I firmly believe that the critical factor of our success at the end of the day is our human capital. For this reason, we invest a lot into people and also emphasize education.

BBJ: Hungary has a reputation as an investor-friendly country, but there is always room for improvement. What would you change to make things better here?

DK: I think that management of the company must be more peoplecentered, and we must invest even greater trust in the associates.

BBJ: Does Bosch have more investments in store for Hungary?

DK: Hungary is a strategically important location for the Bosch Group globally. There are significant strategic investments underway at every local Bosch site. The key investment project at the Bosch Group in Hungary continues to proceed steadily, but construction work is expected to be completed later than initially planned due to the pandemic.

We announced in April that Bosch is investing in a new regional shared service center in Vecsés [22 km southeast of the center of Budapest, close to Ferenc Liszt International Airport]. It is another important milestone for Bosch Group in Hungary and the region. It also demonstrates the strong confidence we have in the competence of Hungarian professionals.

DK: István Szászi takes over as the representative of the Bosch Group in Hungary and the Adria Region from July.

He has been working at the group for 17 years, and on April 1, 2019, he was appointed to lead the Engineering Center Budapest, which operates within Robert Bosch Kft. István used to be an expat since he spent some years in Reutlingen and Abstatt, Germany at Bosch. He will be the first Hungarian representative of the Bosch Group in Hungary; it is a great success. I am proud of him and wish him all the best. Together we are contributing to building a strong and competitive Hungary further. I think it is essential that whatever country you go to as a representative, you try to get to know as many people as possible, inside and outside the company. You have to talk to your colleagues to get a feel for how to run the business. You have to learn the cultural differences as well. I find it very important to build the team spirit, maintain a positive approach, and meet the new challenges with great caution but with just as much optimism.

BBJ: Is there anything else you would like to add?

DK: I would like to thank Budapest and Hungary for hosting my family and me these last five years. I would especially like to address everyone who is part of the Bosch Group Family in Hungary for their outstanding performance and dedicated work.

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The Inflationary Impact on Developed and Emerging Markets EU Annual Inflation Rates 0.1 -1.1

-0.1

Source: Eurostat

2021,

Hungarian Interest Rates, 2011-2021

6 5

5.1 5.2

2.7 2.8 3.1 3.3 2.0 2.0 2.0 2.1 2.1 2.1 2.2 2.2 2.4 1.9 1.7 1.7 1.7 1.6 1.6 1.6 1.5 1.0 1.1 1.2

Of course, if one looks at inflation on a country-by-country basis, results are more scattered, but the trend is upwards everywhere: Inflation in emerging markets may have During the past 25 years, inflation in a much more disastrous impact than in EMs has been consistently higher than developed markets. For example, the Arab in DMs and much higher during two Spring in 2011 was triggered by rapid periods: 1994-2000 and 2018-2020. inflation, particularly in the price of wheat.

U.S. inflation begun to outpace Emerging markets equities are among inflation across most DMs the best performers in periods of high in inflation and strong growth compared to other asset classes. For example, from 1987 to 2021, when global inflation was reaching levels experienced in EMs, above 2%, EM equities were significant indicating an overheating of the U.S. economy, outperformers, generating average fuelled by monetary and fiscal stimulus. annual returns of almost 27%.

7

The Corporate Finance Column

Greece Portugal Malta Italy Ireland Cyprus Denmark Euro area Estonia France Latvia Netherlands Slovakia Austria EU Bulgaria Spain Belgium Germany Croatia Slovenia Finland Lithuania Romania Sweden Czech Republic Luxembourg Poland Hungary

Les Nemethy and François Lesegretain investigate past and current differences in inflation rates between emerging markets (EMs) and developed markets (DMs) and the differences in performance among asset classes between EMs and DMs during periods of inflation.

4 3 2

After a COVID-induced 2020 recession that was less severe in emerging markets than developed markets in terms of GDP impact, EM GDP growth is once again expected to outpace that of DMs, beginning with expectations for a robust recovery in 2021.

USD Debt

The outperformance of emerging market assets may also be explained by the fact that EMs do better in a time of a weakening U.S. dollar. This is because EMs tend to issue U.S. dollardenominated debt; when the USD appreciates, the more local currency is required to service debt, putting a drag on the economy and increasing the probability of default.

As of April 2021, Central European inflation rates are among the top in the European Union. Hungary, Poland, and the Czech Republic are experiencing inflation rates of 5.2%, 5.1%, and 3.1%, respectively.

In Hungary, inflation recently reached an annual rate

of

5.1%,

1 0 2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

Source: tradingeconomics.com

Business | 7

above the central bank’s 3% headline inflation target. This is the country’s highest inflation rate since November

2012. Emerging markets do not have the luxury of allowing their economies and inflation rates to “run hot;” Brazil and Hungary have raised borrowing costs. The Monetary Council of the National Bank of Hungary (MNB), for example, increased the base rate by 30 basis points to 0.9% at a monthly policy meeting on June 22 of this year.

Similarly, the Czech central bank increased its key interest rate by a quarter-point to 0.5% in an effort to tame inflation as the economy recovers from the coronavirus pandemic.

Emerging markets have been a relatively better investment than developed markets over the years, whether you invested in equity or debt.

But it is important to bear in mind that EMs will generally be subject to more significant political, legal, counterparty, and operational risks.

Indeed, both returns and volatility in EMs have been relatively high over the past 20 years.

In terms of countries, the five best emerging market equity performers in 2020 were South Korea (44.64%), Taiwan (40.99%), China (29.49%), India (15.55%), and Argentina (12.7%).

It goes to show that investments in EMs have a place in any portfolio, particularly during a time of accelerating inflation. The choice of country, debt or equity, and the company issuing the debt or equity remain vital questions.

Les Nemethy is CEO of EuroPhoenix Financial Advisers Ltd. (www.europhoenix.com), a Central European corporate finance firm. He is a former World Banker, author of Business Exit Planning (www. businessexitplanningbook.com) and a past president of the American Chamber of Commerce in Hungary.

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Borsodi Debuts WAI Moment Hard Seltzer in Hungary willing to experiment. Based on this feedback, we decided to launch the first two members of our new “democratic” craft portfolio last year, Borsodi Hoppy and Borsodi IPA. Our first experiences have been positive, and consumer and professional feedback have been appreciative. As a result, we decided to expand the portfolio further with ale-type beers, thus strengthening and even introducing the Borsodi brand to new audiences, as well as serving the ever-changing needs of our existing customers.

Borsodi Brewery marketing director György Spiegel talks to the Budapest Business Journal about introducing its hard seltzer to the Hungarian market and beer innovations.

BENCE GAÁL

BBJ: Hard seltzer is a relatively new type of alcoholic drink, which has earned considerable popularity in the United States over the past decade. What lies behind the decision to expand Borsodi’s portfolio beyond beers?

György Spiegel: Before launching a brand-new beverage category in Hungary, we were thoroughly monitoring the market developments locally, in the CEE region, and globally. We could see that hard seltzers have become one of the most popular alcoholic drink categories for Americans in the global beverage market. Molson Coors, the parent company of Borsodi Brewery, has recently begun to introduce the hard seltzer to its portfolio, with great success, in countries like the United States and the United Kingdom. It is now time to present it in the CEE after a thorough assessment of the local specifics of the market. In Hungary, we could see the forming of a new wave of consumers with an experimental attitude who enthusiastically discover new products. So, we have decided to go beyond beer and introduce this new category. Hard seltzer is a type

of alcoholic beverage containing carbonated water, alcohol, and often a fruit aroma. The alcohol volume is 46%, and the calorie content is about 100 kcal per can. Our WAI Moment is under 99 kcal per can, has exceptional quality and natural, delicious flavors.

BBJ: What are Borsodi's sales expectations, and who is the target audience?

GyS: In markets where the products have already been introduced, the hard seltzer has generated 200% growth in the last two years. We hope that the category will expand similarly in CEE in the coming years. Hard seltzer is a fresh new lifestyle drink for a new generation of urban, working adult folk who love to stay in shape and look for exciting beverages that fit their busy yet funloving lifestyle.

BBJ: What is the feedback regarding WAI Moment so far? Do consumers have a favorite flavor?

GyS: We launched three really different flavors of WAI Moment in May, which satisfy different tastes, called “Minty Lime Time,” “Tropical Crew,” and “Crazy Berries.” Although only two months have passed since its introduction, we can say that all three products seem to be popular so far.

BBJ: Can we expect the debut of a new addition to the beer portfolio or a limited edition this summer?

György Spiegel, marketing director of Borsodi Brewery.

BBJ: In terms of your more traditional beer category, the brewery has been going through a large-scale portfolio expansion in the last few years. To what extent did these new products help introduce Borsodi to new audiences and revamp the brand’s image?

GyS: The experiences of recent years have shown that our consumers are more and more open to new tastes and

Borsodi Box Borsodi Sörgyár Rt. began brewing beer in 1973 in the village of Bőcs, near Miskolc (187 km northeast of Budapest by road). Privatized after the collapse of communism, it was purchased in 1993 by Belgium’s Interbrew (today Anheuser-Busch InBev SA/NV). In mid-October 2009, private equity fund CVC

GyS: In time for the summer sports events, we have launched a limited edition of our Borsodi lager beer with diverse, limited edition promotional packages, presenting different superstitions of sports fans. Consumers can find them while stocks last. Also, we have been preparing for the reopening of terraces and bars across the country and hope that more people will have the chance to enjoy a nice time with their friends accompanied by a pint of Borsodi.

We have launched the newest member of the Borsodi Friss portfolio, a 0.0% nonalcoholic beer in pear and apple flavor.

Capital Partners bought all of Anheuser–Busch InBev’s holdings in Central Europe, including Borsodi, for EUR 2.23 billion and renamed the operation StarBev. In 2012, the StarBev Group was taken over by its current owners Molson Coors Beverage Company, the American-Canadian firm which is the fifth-biggest brewer globally.

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Top Legal

EXECUTIVES In Hungary

2021 The most influential legal executives in the Hungarian economy

The Top Legal Executives magazine is a special annual publication of the Budapest Business Journal. It forms part of our “Top” brand, and is a sister publication to Top Expat CEOs in Hungary.

Like Top Expat CEOs, the magazine has a focus on people rather than policy. It presents the profiles of the most influential legal executives working in the Hungarian economy, focusing on outstanding achievements and how the Hungarian legal market is developing.

Those profiles of Hungary’s top “legal eagles” are set against a review of how the Hungarian legal system operates, including the functioning of the Curia (the Supreme Court of Hungary) and the Constitutional Court, as well as the Budapest and national bar associations, among other things.

Why Should I Subscribe?

• Provides an essential overview of how Hungary’s legal system operates.

• Get an insight into the biggest cases of 2020, and likely legal developments in 2021.

• Get to know the personalities behind the legal business.

• Read personal accounts from the country’s top lawyers, detailing how they got into law in the first place and what prompted their choice of specialty.

Please forward your subscription request to: circulation@bbj.hu, or order your copy in the webshop at bbj.hu

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Budapest Business Journal | July 2 – July 15, 2021

Svevind Energy to Produce Green Hydrogen With Wind, Solar in Kazakhstan

Budapest to Install 10 mln sqm of Solar Panels Budapest city leaders announced on June 24 a plan to install 10 million square meters of solar panels in the capital by 2030, state news agency MTI reported. The Office of the Mayor said the scheme aims to cut emissions and reduce energy dependency.

Mayor Gergely Karácsony said the “extraordinarily ambitious” plan would require installing 5 sqm of solar panels for every resident of the city, boosting solar capacity at present by a factor of 130. Department head Ada Ámon, who is spearheading the project at the Office of the Mayor, said the capital’s climate strategy aims to boost solar capacity to 1,500 MW within 10 years while raising the share of renewables used for district heating to at least 50%, cutting the use of cars by two-thirds, adding to Budapest’s green space and upgrading the energy efficiency of one-third of homes. Budapest is getting almost EUR 600,000 to plan the scheme from the European Climate Initiative, a project financing instrument by the German Federal Ministry for the Environment, Nature Conservation, and Nuclear Safety.

Regional Roundup

photovoltaic (PV) plant will feature more than 20,000 solar panels spread on an area of 104,000 sqm and is expected to generate 11,000 MWh (megawatt-hour) per year for the company’s own needs, Aurubis said. The plant will reduce carbon dioxide emissions by 4,000 tonnes per year, the copper producer added.

The construction will be carried out by ČEZ ESCO, a local unit of the Czech ČEZ Group. The value of the investment was not disclosed.

EBRD Lending EUR 2 mln to Kosovo for Green Investments

Germany’s Svevind Energy GmbH intends to install 45 GW (gigawatt) of wind and solar power capacity in Kazakhstan to feed 30 GW of electrolyzers to produce green hydrogen. The German investor and project developer has signed a memorandum of understanding (MoU) with government-controlled agency Kazakh Invest National Company JSC regarding its plan,

Business | 9

reports energy portal Renewables Now. Once the wind and solar parks are installed, the massive complex will be powering electrolyzers that will produce three million tonnes of green hydrogen annually.

The output will either be exported to Eurasia or used locally to create “high-value green products” such as ammonia. Svevind anticipates that the entire development, engineering, procurement, and financing process will take between three and five years. Building and commissioning the capacity will also take five years.

Bulgaria’s Zagorka Installing Solar Park at Stara Zagora brewery Bulgarian brewer Zagorka, part of Dutch-based Heineken International, has announced that it is building a solar park at its brewery in the city of Stara Zagora.

The first photovoltaic (PV) panels have already been installed, and the

brewery will be able to use green energy for part of its production process very soon, Zagorka told news portal SeeNews on June 23.

Zagorka says it aims to use only renewable energy sources in its production process by 2030.

The European Bank for Reconstruction and Development (EBRD) said on June 28 that it is extending a credit line of EUR 2 million to the microfinance institution Agency for Finance in Kosovo (AFK) for residential energy efficiency investments. The credit line, provided under the EBRD’s Green Economy Financing Facility (GEFF), will be used to finance investments in energy efficiency in privately-owned houses, such as insulation, windows, heat pumps, and solar panels EBRD said. In addition, borrowers will be eligible for up to 20% cashback on successful project completion through funding provided by the European Union.

Enel 90-MW Russian Wind Poland Auctions Contracts for 2.5 GW Farm Starts Operation of Solar, Wind Enel Russia, a unit of Italian

energy giant Enel SpA, has officially opened its 90 MW (megawatt) Azovskaya wind farm in Russia’s Rostov region, reNEWS.biz reports.

The 26-turbine project, which is spread across 133 hectares (328.6 acres), will generate around 320 GWh (gigawatt hours) of electricity a year. Capital expenditures on the wind farm were EUR 135 million, Enel said. The Eurasian Development Bank (EDB) provided financing for the construction. Azovskaya is one of three wind projects that Enel is implementing in Russia.

Aurubis Bulgaria Starts 10 MW PV Plant Copper producer Aurubis Bulgaria, part of Germany’s Aurubis AG, said on June 23 it had started the construction of a solar plant near its smelter in Zlatitsa, in the Sofia region.

The 10 MW (megawatt) Aurubis-1

The Polish Energy Regulatory Office (ERO) has announced its solar and wind auction results for projects above 1 MW (megawatt) and another procurement exercise for renewables up to 1 MW in size, PV-magazine says. The tenders were held on June 8 and June 11, respectively.

In the first of the two auctions, solar accounted for around 1.2 GW (gigawatt) of the assigned capacity.

About 24.7 TWh (terawatt hours) of power was contracted in total, which is only 68% of the 38.7 TWh that the ERO had expected to assign.

Around 300 MW of capacity was set aside for wind power projects. In the second procurement exercise, all contracted capacity (around 1 GW) went to solar projects. The ERO revealed that all 1,264 submitted offers were for solar installations and that 11.9 TWh was contracted across 1,016 projects, although it had planned to assign 14.7 TWh.

Bulgarian brewer Zagorka is looking to go green by building a solar park at its brewery. Photo by Atanas Bagashevv / Shutterstock.com

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Country Focus

United States 30 Years of Developing Relations, Building Connections, and Sharing Knowledge AmCham Hungary president Zoltán Szabó discusses the inheritance of the chamber’s American roots and the impact those still have on its work today with the Budapest Business Journal.

Zoltán Szabó. Photo by Lázár Todoroff / AmCham

ROBIN MARSHALL

BBJ: AmCham today is a multinational chamber but has solid American roots. How would you characterize the U.S. influence on the Hungarian economy today?

Zoltán Szabó: Despite the rising investment from the Far East, the United States remains one of Hungary’s most important foreign investors and a significant source of job creation. The share of high value-added investments has also been increasing in recent years, especially in the ICT sectors, the service sector, business service centers, logistics, and research and development projects.

In addition, American businesses drive sustainability initiatives, introduce advanced technologies to increase productivity, are vocal on social issues, and, overall, have had a significant influence on our business values.

BBJ: AmCham is famous for its American-themed events, from the Fourth of July Family Day and Thanksgiving to the Super Bowl Watch Party to the four-yearly U.S. Election Party (sadly canceled by COVID last year). What do you think is the enduring attraction of these events?

ZSz: These events strengthen our community and cherish our American roots and values; they have been staples in our event calendar for decades. Besides giving the members great networking opportunities, they also allow us to step away from the daily grind to relax and have fun. We cannot wait to bring them back.

BBJ: What percentage of your current membership is taken up by Americanbased businesses? How has this changed over the years, and what might that say about the developing economy?

ZSz: About a third of the membership is American; it has been steady at this level. Most of these companies are longterm members, some since the foundation of the chamber. This signals a firm commitment not just to AmCham but to the country. Back in 1989, the founding members established the chamber to develop relations, build connections, share knowledge, and work together to make a better place to succeed. That’s still the core of our activities, but we are proud to serve a diverse, international community now, comprising corporations and SMEs. These businesses are here for the long run, and AmCham gives them the chance to make a difference, to define and discuss the most pressing challenges with other companies and policymakers.

BBJ: What most worries your American members about doing business in Hungary? What are the main concerns?

ZSz: The number one concern, as always, is the availability of a highly skilled workforce. One side of the workforce issue is education. We need to transform the system to equip people with the skills and competencies they need to succeed and grow in a dynamically and rapidly changing world and support our country’s transformation from manufacturing to innovative, higher added-value products and services. This requires a major

overhaul on all fronts: the allocation of funds, the scope of education, digital literacy, STEM education, language skills, research and intellectual property rights, career orientation, business and university cooperations, the future of the teaching profession, their training, you name it.

About a third of the membership is American; it has been steady at this level.

Most of these companies are long-term members, some since the foundation of the chamber. This signals a firm commitment not just to AmCham but to the country.

The other side of the issue is a more flexible and modernized regulatory environment that embraces remote working and other atypical work forms which grew during COVID-19 and could help businesses access the untapped potential in our labor reserve. COVID19 also put the supply chains to the test; we need to make sure we build a more substantial, more resilient SME base.

Another growing concern is the proposed global minimum tax that could change the investment landscape. For investors, one of the most attractive factors in Hungary is the 9% CIT, one of the lowest in the world.

This could have significant implications for businesses operating in Hungary.

We address these issues and other challenges critical to our country’s competitiveness in our new strategic guideline, the Policy Agenda 20212025, and the “Cooperation for a More Competitive and Sustainable Hungary” recommendation package. These are based on insights from members, categorized into three strategic areas: Smart Growth, Business Environment, and Human Capital.

BBJ: The chamber has a close working relationship with the U.S. Embassy.

Is that harder to manage in periods like now, where there is no incumbent ambassador in the post?

ZSz: We do maintain a good working relationship with the embassy, regularly consulting on economic matters. Even though there is no incumbent, Chargé d’Affaires Marc Dillard and his team are most capable and always ready to support us. We are eager to find out who the next U.S. Ambassador to Hungary will be. Historically, ambassadors are regulars on the AmCham podium; in fact, the chamber is one of the few public forums where the U.S. Ambassador and their Hungarian counterpart sit down together for a discussion.

BBJ: COVID-19 forced businesses to take meaningful steps to adapt, rethink processes and become resilient. How did the pandemic impact AmCham?

ZSz: Like every other business, we had to adapt to the rapid and drastic changes brought by COVID-19, but more than that, we committed to improving and renewing. AmCham’s role as a knowledge sharing and cooperation platform became more crucial than ever with the pandemic.

We did not skip a beat: every committee and working group continued working online, we managed to hold our events online or in a hybrid format. Since the outbreak last March, we have represented our members at weekly strategic meetings with the government and posted several recommendations based on their insights and experiences to support the economic relief efforts, many of which were implemented.

What is more, when we introduced the Policy Agenda earlier this year, we decided to re-vamp the way we work to become more effective and to provide more opportunities for members to get involved and drive the advocacy work to deliver more tangible results. Of course, we were fortunate in being able to rely on a committed membership that stuck by us despite the hardships of the past 16 months. We hope that the way we work and the world around us will get back to normal soon. We are excited to meet and work with our membership again in person.

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PRESENTED CONTENT

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Focus | 11

U.S. Largest Investor in Hungary in 2020 Over the past few decades, Hungary has become a significant investment location for U.S. companies.

The Hungarian Investment Promotion Agency tells the Budapest Business Journal that a stable political and economic environment, highquality infrastructure, favorable taxation system, motivated and highly-skilled work force, plus diverse language and technological capabilities are just some of the features that make Hungary particularly appealing when it comes to choosing a location to settle.

BBJ STAFF

The U.S. plays a significant role in the Hungarian trade and investment field.

American companies are present in economic sectors ranging from general and advanced manufacturing segments to business services as well as a great variety of high value-added areas like electronics and medical technology, HIPA says.

The U.S. has risen to become the second-largest investor in Hungary, with around 1,500 companies employing almost

100,000 people.

Between 2016 and 2020, HIPA supported 65 new investment projects from the United States, leading to the creation of more than 10,000 new jobs for Hungarians with a total investment volume of over EUR 1 billion.

In 2018, U.S. foreign direct investment stock reached almost USD 9.9 bln,

HIPA has a strong working relationship with the American Chamber of Commerce.

From left: Írisz Lippai-Nagy, CEO of AmCham; Róbert Ésik, CEO of HIPA; and Zoltán Szabó, president of AmCham. Photo by Lázár Todoroff / AmCham amounting to around 10.7% of total FDI stock in Hungary, according to a publication by the National Bank of Hungary (MNB) issued on March 23, 2021, citing data from 2018.

As far as the number of newly created jobs is concerned, America was actually the largest investor in Hungary in 2020; 15 U.S. companies made positive investment decisions with a total of 2,496 planned new workplaces.

Bilateral commercial trade reached almost U.S. 5.9 bln in 2020, which was a 0.1% increase compared to the previous year. According to the Hungarian Central Statistical Office data, the United States was the 2nd most important trade partner of Hungary outside the European Union in 2020.

Export Consumer

Imports to Hungary were over USD 2.3 bln, putting the U.S. in 14th place on the list of source countries.

The U.S. is also the second-largest consumer of Hungarian exports outside the EU, with over USD 3.5 bln in exports. Between 2010 and 2020, Hungarian exports grew by more than 84%, making America the 11th most important export market for Hungary.

Electronics, automotive and engine parts manufacturing, life sciences, agriculture, and logistics are some of the industries where American operations play a crucial role.

Fourteen large U.S. companies (including GE, National Instruments, Aptiv, Jabil, Coca-Cola, Arconic, Lear, and Amphenol) employ more than

43,000 employees

with locations from Szombathely (222 km west of Budapest by road) to Debrecen (233 km east).

Companies within the business services and ICT sectors have traditionally demonstrated a strong presence in Budapest, with BlackRock, Citi, Diligent, IBM, Microsoft, and Morgan Stanley among the examples, HIPA says.

An increasing number of U.S. HIPA has also been active in companies are deciding to reinvest or policy advocacy and has a longexpand their operations in Hungary. In standing partnership with the U.S. addition, there is a growing emphasis business community and the on talent management, educational American Chamber of Commerce collaborations, and innovative solutions. in Hungary. In addition, AmCham In the business services sector, centers has a significant role in supporting of excellence have been emerging in member companies and facilitating recent years, where ever more complex constructive dialogue with the activities are carried out, including Hungarian Government and HIPA. functions like R&D, engineering, product The past 18 months have shown design, or software development. Some of that crisis resilience, supply chain the latest high value-added investments security, and active government support were announced by Diligent, Ford, S2G, of businesses play an increasingly Thermo Fisher Scientific, and ExxonMobil. important role in the future of global investment decisions.

Incentives U.S.-Hungarian economic relations HIPA says it offers a wide variety of are strong and continuously growing incentives to facilitate foreign direct as a result of accomplishments and investments and reinvestments by mutual trust. Hungary remains enterprises. The main types of incentives determined to maintain efforts in are cash subsidies or tax deductions. order to ensure a favorable and Over the years, HIPA has been competitive business environment providing one-stop-shop management and is committed to supporting the consultancy services to U.S. businesses continued successful operation and willing to establish or expand their further growth of U.S. companies in operations in Hungary.

Hungary, HIPA insists.

U.S.-Hungarian Bilateral Trade (2020)

USD 5.9 bln

U.S. Imports to Hungary (2020)

USD 2.3 bln

Hungarian exports to U.S. (2020)

USD 3.5 bln

Growth in exports to U.S. (2010-2020)

84%

HIPA Supported U.S. Investments (2016-2020)

65

U.S. Firms in Hungary

1,500

Hungarians Employed by U.S. Firms

100,000

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Special Report Tourism

Domestic Guests to Drive Tourism Recovery Amid Labor Shortage Fears Labor shortages remain a central problem for the COVID-ravaged tourism industry but, due to travel restrictions abroad and thus a strong interest in domestic holidays, the chances are that the sector can close a successful season this year, experts tell the Budapest Business Journal.

Rudolf Semsei, vice president of the Hungarian Catering Industry Association. been booked for July and 1.6 million for August. Accommodation in the Balaton region is the most popular

with

35%

ZSÓFIA VÉGH

“Thanks to the successful vaccination program, the focus is now on restarting the industry. The Hungarian Tourism Agency (MTÜ) is confident that the sector will recover quickly,” the authority says.

Due to the prominent role of domestic tourism this year, several developments are currently underway, all of which will strengthen the number of offers that are on a par with European quality, the organization adds.

With the number of summer bookings rising, there is every chance that this will be a more successful summer season than last year, with at least 17 million guest nights compared to 13.5 million in 2020, MTÜ says.

This June, the number of guests nights spent or booked is 21% more than last year. Year. Foreign guest nights are also on the rise, albeit from a low bar, with the 2021 figure up 157% compared to 2020, MTÜ says. After Germany, most bookings come from Romania, the Czech Republic, France, and Poland.

According to information gathered by the National Tourist Information Center, 2.1 million guest nights have

of the total, followed by the Mátra-Bükk mountain region (8%) to the northeast, Debrecen, Hungary’s second city, and its surroundings (7%), as well as BükSárvár (4%) in the west of the country.

Accommodation in the capital makes up 10% of overall guest bookings.

Given that many are making lastminute travel decisions, it is likely that the current figures will change significantly in the coming weeks, analysts say.

The opening of the Schengen border will bring a surge in inbound tourism, as surveys show that most Europeans want to travel abroad. Hotels, private and “other” accommodation are the most sought after, while interest has shifted towards quality services.

Key Issue

What is clear is that the labor force will be one of the key issues for the tourism sector this year and in the future. Since the reopening in May, job advertisements abound on all platforms; the demand for workers has spiked.

In Budapest, downtown facilities with no terrace have had the hardest time restarting as, without tourists or office

workers and outside seating, there is little traffic, Rudolf Semsei, vice president of the Magyar Vendéglátók Ipartestülete (Hungarian Catering Industry Association or MVI), tells the BBJ. Restaurants with terraces and in the suburbs have fewer problems in this respect, but they lack a sufficient workforce. Migrating to other employment sectors has become a serious problem; many who worked in the industry prior to the pandemic are wary of returning amid concerns of a fourth wave arriving in the fall, according to Semsei, who is also the owner-managing director at Budapest Party Service and the VakVarjú restaurant.

Similarly, at Lake Balaton and countryside holiday resorts, it is the shortage of labor that is causing a problem.

“People will make a decision [on returning to the sector] after the summer at the latest; by then, we will see whether or not the pandemic returns,” Semsei says. But the peak season is by no means over with summer, he adds. In Budapest, the fall and the period leading to the winter holidays is usually the busiest with corporate events and conferences.

He is confident that, unlike last year, when firms canceled their plans, many companies are determined to hold those events this year.

Growing Interest

“Based on the number of requests for quotes, we see growing interest,” he says. “Compared to international conferences generally booked years in advance, these may be smaller-scale events, but still many with a few hundreds of attendees,” he explains, adding that roughly 50% of the 2019 volume could be reached this year.

Regarding long-term labor supply, the expert is optimistic. “Hotel and hospitality continue to be the most popular faculties at colleges, so I am not worried about that,” Semsei notes. The rise of celebrity chefs and the like have helped make the profession even more popular, as does dual training.

“Our responsibility is to offer proper training and show an attractive career path for the young. Success needs time, though; the time it takes a high-school student to qualify can be five to eight years,” he adds.

“Our responsibility is to offer proper training and show an attractive career path for the young. Success needs time, though; the time it takes a high-school student to qualify can be five to eight years.”

The Hungarian Tourism Agency also has taken steps when it comes to the workforce. An emphasis will be placed on vocational training and education, and a “Career in Tourism” campaign will be launched, which will look to boost the prestige of professions in the sector with short films, image videos, and a new website (www.karrieraturimusban.hu).

It also hopes to inform students and employees about prospects and career paths.

The revenues generated by the growing guest traffic will bring a real recovery for the sector in the first place, though. To that end, a large-scale traffic stimulus campaign has been launched, MTÜ notes. This is tailored to different parts of the country, conveying messages with specific themes based on each location.

To further boost recovery, measures alleviating some of the burdens from industry players will remain in force, including ironically, dropping the tourism development contribution until the end of the year.

14 | 4

Special Report

News///in brief Tourism

High-end Holiday Real Estate Prices Double From 2016 Interest in residential properties offered for sale in the most popular, high-end holiday areas has more than doubled since 2016, writes profitline. hu. Demand was also significant last year, coupled with rising prices. On the northern shore of Lake Balaton, the average price per square meter increased by 35%, and on the southern side, there was a 20% increase in one year. Prices at Lake Tisza also increased significantly, but the average price per square meter was still well below HUF 200,000 in June. The Danube Bend is no exception, seeing a 44-59% price increase.

Wizz Air CEO Decries EU Travel Rules József Váradi, the CEO of Hungarian low-fare carrier Wizz Air, said “overpoliticized” European Union travel rules hinder meeting the demand for

flights by vacationers in an interview with CNBC on June 2. Váradi said there is “huge” demand for summer travel in Europe, but the volatility of the European regulatory framework for travel remains an obstacle. “There is nothing wrong with the consumer, there is nothing wrong with people’s willingness to travel, the problem is government-imposed restrictions and the unpredictable nature of that,” he told CNBC’s Squawk Box Europe.

He noted that domestic air travel in China is at 110% of 2019 levels, and domestic air travel in the United States is also expected to be over 100% during the summer.

Summer Bookings Increase 40% Since the beginning of May, the number of pre-bookings received for the summer months has increased by more than 40%, according to origo.hu.

If the growth remains that dynamic, it will be difficult to find accommodation in popular holiday destinations in

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Budapest Business Journal | July 2 – July 15, 2021

Hungary in the high season, the Hungarian Tourism Agency (MTÜ) warns. Based on the data, the country will have a more robust summer than last year, meaning booking in good time will be necessary.

BGYH Wins Bid for Rác Baths BGYH, the Budapest municipal council’s spa company, has won a bid to buy the Rác complex, one of the capital’s historical Turkish baths, the Mayor’s Office has said, according to mfor.hu. Bidding for the baths and the connected hotel started at a little over HUF 5 billion. The baths were renovated in 2010, and a 67-room boutique hotel was added, but neither reopened because of an ownership dispute. The National Reorganization Nonprofit Company took over the liquidation of the project company that carried out that renovation.

Government Approves National Tourism Strategy The government has approved its National Tourism Development Strategy, laying a solid foundation for the sector’s recovery, Zoltán Guller, the head of the Hungarian Tourism Agency, has told mfor.hu. The strategy advocates digitalization, the expansion of the data-driven management of the sector, putting a tighter squeeze on

tax evaders, implementing consumerfocused marketing and sales, and enhanced training. It addresses catering, wellness tourism, business travel, conference tourism, and religious tourism in separate chapters.

A key message of the plan is that working in tourism and catering is “not just a job, but a profession,” Guller said. The strategy continues to target an annual 20 million visitors and 50 million guest nights and aims to make Hungary the most popular tourist destination in Central Europe by 2030, he added. The strategy was drafted with the participation of 49 professional associations and five historical churches.

Representatives from those groups signed a memorandum of understanding on solidarity and strengthening cooperation.

1st Cruise Ships Arrive Since September Two cruise ships have arrived in Hungary, the first since September 2020, after the country reopened its borders to tourists on June 24, government spokesperson Alexandra Szentkirályi said in a video message on Facebook on June 25. More than 300 tourists are traveling on the cruise ships, which are also making stops in Esztergom (45 km northwest of Budapest) and Mohács (190 km south), Szentkirályi said.

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Special Report

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Budapest Business Journal | July 2 – July 15, 2021

Balaton Looks to a Renaissance, but Fast Developments Face Growing Resistance It is almost midJune and one of the first hot days of the summer, and though the tourist season has yet to get into full swing, after the long months of winter lockdown, the many sailing boats make a fine sight on the glistening waters at the northern end of Lake Balaton.

KESTER EDDY

alternative is to play games inside the hotel room while the rain beats down outside.

“The Bobo Fun Park helps turn Balaton into a four-season offering,” Dóra Kutai, marketing manager for both the park and Kolping Hotel, tells the Budapest Business Journal.

Long-term Growth

Balaton accommodation ranges from modest AirBnB rooms in private homes to high-quality hotel and spa treatment centers. Pictured is the four-star Hotel Silverine Lake Resort, in Balatonfüred. Managing director Andrea Rádóczy, who is also chairwoman of the Balaton Region section of the Hungarian Hotels and Restaurant Association, says the recovery of the hotel sector on Balaton appears very dependent on location, with the best sited experiencing strong demand. “For July, inquiries have been more intensive than last year and [for the best located] even more favorable than in 2019,” she says.

Well to the south, some six kilometers from the western tip of the lake in the village of Alsópáhok, a ceremony is underway to open the Bobo Fun Park.

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This comprises a 3,000 sqm amusement complex with a dazzling array of games and challenges designed to keep families with children aged from tiny tots to early teens amused for four hours at a stretch and still wanting more.

The project, the result of a HUF 2.1 billion investment, including HUF 946 million in state support, was completed in less than a year, despite the COVID crisis.

Csaba Baldauf, managing director of the park and the adjacent Kolping Hotel, said that similar to his experience in the 2009 financial crisis, he had decided to “step on the gas” to be better equipped to serve the tourist market once the pandemic allowed a reopening.

Moreover, the park represents not merely another attraction for Balaton tourists but an all-weather bolt hole for frazzled parents on those difficult days when the weather turns sour, and the only obvious

The amusement center is just one of scores of developments, including hotel and other accommodation projects and the renewal of lakeside beaches, subsidized by the Hungarian Tourism Agency (MTÜ), which it says will help “guarantee the long-term growth of tourism” in the region.

In total, Lake Balaton has received more than HUF 125 bln (USD 420 mln) in domestic funding since the so-called Kisfaludy Program was begun in 2017.

This includes a comprehensive renewal of accommodation infrastructure, including more than HUF 60 bln to develop a total of 49 hotels, MTÜ wrote in response to questions for this article.

(See separate box.)

“Lake Balaton is experiencing a renaissance today. You can eat better than ever, there are excellent beaches on both shores, the bike path [system] is developing, and we could count until the cows come home how many cool things are happening here today.”

And with the easing of COVID restrictions, hopes are high for a strong recovery in the tourism sector this season, enabling the beginnings of a quick return on these investments.

“A total of 1.3 million nights has been booked in the Lake Balaton region for July-August so far, which

MTÜ’s Development Plans for Balaton: An Overview The Hungarian Tourism Agency’s (MTÜ) development plans for Balaton are certainly grand. As noted, the region has received more than HUF 125 billion in state funding since 2017 under the Kisfaludy Program. In addition to a HUF 60 bln-plus program to develop 49 hotels, HUF 4.5 bln has been allocated to renovate 137 guesthouses, with another HUF 18.1 bln earmarked to upgrade a further 5,882 accommodation establishments, MTÜ said.

Simultaneously, the Kisfaludy Beach Development Program is overseeing the renewal of 97 beaches on Balaton’s shores, and the development of several other

attractions is also either underway or in the preparation phase.

In terms of transport, the HévízBalaton Airport will operate as a modern, European-level airfield thanks to recent renovation projects.

BAHART, the Balaton Shipping Company, is investing HUF 200 million in overhauls of older vessels and has ordered two new ferries and two catamarans, with construction beginning this year.

MTÜ also stressed that a standardized accommodation rating system covering all types of accommodation in Hungary would be gradually introduced from January 2022, aimed at helping to regain guests’ trust.

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www.bbj.hu

Budapest Business Journal | July 2 – July 15, 2021

Special Report | 17

Developments Cause Backlash from Locals, Political Opposition

The official opening of the Bobo Fun Park in Alsópáhok, just beyond Keszthely on the western tip of Lake Balaton. accounts for 35% of national overnight stays. Among these, the most popular destinations are Siófok, Balatonfüred, Hévíz, Zalakaros, and Tihany,” the agency said.

Furthermore, with tourism marketing campaigns ratcheting up in key international markets, plus the reopening of Schengen borders, hopes are high for a “sharp increase” in foreign visitors.

“Lake Balaton is experiencing a renaissance today. You can eat better than ever, there are excellent beaches on both shores, the bike path [system] is developing, and we could count until the cows come home how many cool things are happening here today,” says Bobo park’s Kutai.

The speed and scale of development projects around Lake Balaton have attracted much criticism from both local groups and the parliamentary opposition, with allegations ranging from political cronyism and loss of public beaches to rampant environmental damage.

“We want to stop the colonization of Lake Balaton because our children’s future is not for sale,” Bertalan Tóth, Socialist co-president, declared in May, as part of a joint environmental protection initiative, launched in association with the green LMP party.

Speaking for the latter, MP Erzsébet Schmuck pledged that the opposition would restore the environmental protection regulations she said “have been destroyed” by the Fidesz government.

Angéla Badzsó, founding chair of Összefogás a Balatonért (Together For Balaton), an association created to voice the concerns of local communities around the lake, agrees.

While on paper, both the water, immediate shore, and areas around Balaton are given strong environmental protection,

this is totally negated once the government declares any project to be of “extaordinary national interest,” which trumps all protection legislation, she tells the BBJ. “It makes a mockery of the law,” she says.

As a result, buildings are going up “all over the lake” on greenfield sites, with the associated destruction of trees, reed beds, and other natural habitats.

Moreover, it is alleged that the rush to build hotels, marinas, and new holiday flats have progressed above the heads of local people, who wake up to find their former public beach has suddenly become a private area for which they have to pay to gain access. At the same time, the new developments are overloading already stretched utilities such as water and sewage systems.

“Tihany [one of Balaton’s most attractive locations] has a permanent population of about 1,200-1,400. They are developing a new residential area which will add at least 1,000 to this number, but the infrastructure doesn’t exist [to handle this increase],” Badzsó cites by way of example. In addition,

Angéla Badzsó the influx of money has propelled property prices way beyond the means of most local people.

“Nobody can afford to take out a mortgage for a simple private home when the cheapest price is at least HUF 800,000 per sqm,” she argues.

“Don’t get me wrong: we are not against developments, but this has to be in cooperation with the local people. And a proper environmental impact study should be undertaken before any project is begun. In any normal country, this is what happens.

But not here,” she says.

The Hungarian Tourism Agency was asked for comment on these criticisms but failed to respond.

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It is ideal for a relaxed lunch, an afternoon cocktail, or dinner with friends. Feel the cool breeze while savoring Hungarian and Viennese specialties, including stew of veal tongue, Wiener schnitzel, and tafelspitz, as well as mouthwatering steaks, grilled fish, seafood, and some of the city’s finest burgers. Surrounded by green shrubs and plants, in the shade of our iconic giant red umbrellas, you can take delight in dining al fresco while watching pedestrians pass by.

The newest hotel on the Danube Bend, the Grand Hotel Esztergom, is located one hour’s drive from the capital city, Budapest.

A 4-star superior hotel with an exclusive wellness department, it was opened on July 1, 2021. The hotel management company is the Hungarian-owned Continental Group, one of the key players in the Hungarian tourism industry.

The hotel has conference and event capacity that is exceptional in the region in terms of size, equipment, and characteristics. Its 399 sqm event room, 350 sqm circular conference room, with natural light, and five well-equipped panoramic meeting rooms are suitable for a wide range of corporate and other events.

Pepper, the hotel’s social robot, awaits guests in the lobby. It can speak, hear, gesture,

Alternatively, order one of our grill boxes with premium ingredients and invite your friends and family around for a BBQ and a few drinks in your garden. Or pick up your pre-ordered picnic basket full of delicacies as well as a soft blanket at ÉS Bisztró and enjoy the sun and delicious bites in your favorite public park or on your terrace.

and even dance. In addition, a 700 sqm recreation space will be awaiting guests with a laser room, table tennis, Xbox corner, and much more from the end of July. It will be a great experience not only for kids but also for adults; it can even serve as a venue for team-building activities.

Aquasziget, Esztergom’s famous “experience bath,” is located next to the hotel, with unlimited free access for hotel guests.

The hotel also offers its own wellness services; the panoramic top floor wellness area, which opens in August, will be a smaller, exclusive “adults-only” luxury wellness lounge.

ÉS Bisztró Deák Ferenc utca (Fashion Street) 12 and 14, 1052 Budapest esbisztro.hu

18 | 4

Special Report

www.bbj.hu

Budapest Business Journal | July 2 – July 15, 2021

Hungarian Travel and Tourism Faces Slow Recovery With Hungary’s tourism industry slowly reopening, Tamás Flesch, president of the Magyar Szállodák és Éttermek Szövetsége (the Hungarian Hotel and Restaurant Association or MSZÉSZ), gives the Budapest Business Journal an exclusive overview of the sector from his perspective.

GM Case Study: Arne Klehn, Multi-property GM for Marriott Budapest

ÉVA KASZAP

BBJ: The contribution of travel and tourism in Hungary has always been higher than the OECD average. Why? Tamás Flesch: Yes, this is true. Only giant tourist destinations such as France or Italy rank before Hungary in this term. Like it or not, this is mainly due to Budapest. I may sound biased, but I think that Budapest is one of the most beautiful travel destinations in the world and holds a solid touristic value. Some two-thirds of Hungary’s foreign guest nights are realized in the capital city. The country’s total commercial accommodation revenues were HUF 550 billion in 2019, of which foreign visitors generated some 50%. At

Tamás Flesch the same time, we see that domestic tourism is also becoming stronger due to increasing spending and the introduction of the so-called “SZÉP Kártya” (Széchenyi Relaxation Card) into the cafeteria scheme.

At present a total of HUF 200 bln is

GM Case Study: Tamás Fazekas, General Manager, Anantara New York Palace Budapest Hotel We have launched many online applications through Stayapp, which allows guests to order services or make specific inquiries more easily and quickly. Requests and questions are routed directly to reception; they can chat in real-time with our team, who consult with the appropriate in-house departments. We have appointed a hotel health and safety manager and implemented new standards, including advanced digital services, upgraded cleaning and sanitizing protocols, tailored F&B services, personal safety equipment, water purifying and air quality protocols, and an ionizing air cleaning machine. Furthermore, we have implemented the concept of hybrid meetings with our AV in-house technical company.

This year, we plan to proceed with a soft refurbishment that includes a new lobby concept with F&B services, an additional restaurant, renovated rooms with a fresh interior design, beds and mattresses, a new fitness area, and a renovated spa. Moreover,

we are re-evaluating the terms and conditions for the prices, contracting, and cancellation policies, showing a certain flexibility.

Currently, we are receiving an increase in inquiries for Q4 2021 and Q1 2022. There is also demand for Christmas parties from local Hungarian partners. Furthermore, the movie industry still sees Budapest as a popular destination for film shoots.

We are receiving many inquiries from film crews, and during the lockdown, we also hosted film guests in our rooms and suites. We found a new niche market for our hotel during the pandemic because a lot of sports events have relocated to Budapest and, because we are close to some of the newest stadiums, we are also working with sports associations. Due to the pandemic, we have considered giving the exclusivity of several floors for sport team groups living in a health and safety “bubble.” Some of the cruise lines have already signaled their interest for 2022.

stockpiled in the “SZÉP Kártya” system, which can only be spent on tourism, catering and attractions. Around 2008, Budapest delivered an increasing growth rate due to the development of its ruin bars. Many incoming tourists who spent a vacation here at the age of 18 come back with their children.

BBJ Which part of the industry has been hit hardest by the pandemic?

TF: This is very hard to answer. The whole industry has been hit in general, almost all parts of it. I would instead separate Budapest from the rest of the country. Budapest was the primary victim, and its situation is expected to remain steady until the recovery of air traffic and the end of lockdowns. Some 90% of the “fine dining sector” targets foreign clients. It was affected more seriously than smaller peers focusing on local customers, for example. The same applies to hotels in Budapest and at countryside. I encourage model change, but meanwhile, I remain skeptical.

Hungarian guests will hardly replace foreigners in the long run. Those serving only HORECA [hotel, restaurant, and café] clients went bankrupt. Those who own a more diversified product and client portfolio could survive.

BBJ: Who is open, and who will open later?

TF: Generally, everybody is open now.

Hotels, and restaurants too. In fact, hotels have never been closed; they simply did not have guests. Both small hotels and five-star establishments are open, the

In the spaces where associates work “behind the scenes,” we increase the frequency of cleaning and focus on high-touch areas like associate entrances, locker rooms, laundry rooms, and staff offices. Mobile check-in/out, service requests, and chat can also be used for room service. Other features, including Mobile Key and Mobile Dining, are available, which increases touchless experiences for our guests.

As we see that the leisure segment will recover first within the coming months, we have put various attractive leisure packages on our shelves, including offers for couples, families, and solo travelers. Last year, we opened what had previously been our Executive Lounge as the Liz and Chain Sky Lounge roof bar to welcome locals on the ninth floor.

Here, you can admire iconic views of Buda and, with a cold drink in hand, experience the very magical feeling of Budapest. Our Big Dog food truck will be introduced shortly and circulate in the city, providing street food specialties. In partnership with our AV partner Special Effects, we have developed an innovative solution called Extended Reality for online and hybrid meetings.

Hygiene standards and protocols remain our top priority. Throughout the pandemic, we focused on the retention and development of our associates to continue providing exceptional experiences for our guests. The year changed almost everything, but we continue to take care of our guests and each other. We welcome all of our guests to a fully renovated hotel; we are here to stay.

2021 has developed as a transition year, with borders opening slowly.

We certainly expect greater demand for 2022, with twice the room nights in the pipeline compared to this year.

We count on leisure tours returning with major cruise operations next year, as well as a variety of city-wide events that will further strengthen awareness of the destination.

latter welcoming mainly business visitors.

Last summer, Budapest generated some 25-30% occupancy rate due to some business trip and car-based visitors from nearby countries. That ended in September. Now, it has a single-digit occupancy rate of around 8-9%, on average. We expect it to climb to 30% this summer, reaching 50-60% this fall, thanks to COVID certificates. The countryside could perform even better.

www.bbj.hu

Budapest Business Journal | July 2 – July 15, 2021

GM Case Study: Stephan Interthal, General Manager, Kempinski Hotel Corvinus Budapest Our head office reacted very fast to the pandemic and introduced new policies adapted to the situation from the very beginning. One good example is the Kempinski White Glove Services, covering all areas of our luxury hotels.

At Kempinski Hotel Corvinus Budapest, guests may ask for different sports equipment, like yoga mats, hand weights, aerobic balls, and resistance bands, for innovative in-room workout solutions. Until now, the spa operated by appointment only. On request, we can privatize it or an entire guest floor for a group, creating a small “bubble.” We still offer home delivery and takeaway service from our ÉS Bisztró, as we do from our associated restaurant Nobu in the hotel.

Last year, we introduced our Home Office in Style package for guests looking for private office space, and it is still popular. We offer streamed and hybrid meeting facilities and virtual team building, e.g., online cooking or wine/beer/whisky/gin tastings, where

BBJ: What do you think about the level of government support?

TF: We had various consultations with the government. I would say that I would have invested more in people, especially because Budapest is performing very well in terms of booking.com ratings, mainly due to its highly experienced, highquality professionals. Do not forget that this is not just a financial question but a motivational one as well. Overall, the most important and effective government grants in Hungary were the wage subsidies. This is a very labor-intensive sector and very underfinanced at the same time. It was easy to pull people out of the market during the pandemic. Our partners must comply with HCCP [hazard analysis

the ingredients/drinks are boxed and delivered to the participants in advance.

We took advantage of the very slow period during 2020 to complete the comprehensive room and suite refurbishment project that started in 2017, with the redesign of our Presidential Suite and the Corvinus Art Suites Collection on floors eight and nine.

Now, 16 months into the pandemic, we have learned that fast changes and on-and-off restrictions are the only constant dimension in our life. Regarding the outlook, we are optimistic. We will have to stay flexible as we need to adapt to changed conditions almost weekly.

We see a glimpse of hope as border restrictions are easing, allowing people to travel, and we have increasing numbers of requests, albeit at a slow pace. A prediction for the fall/winter from 2021 to 2022 is difficult, and without being pessimistic, we are erring on the side of caution when it comes to planning.

and critical control points] requirements, stockpiling, re-hiring, workforce training, plus an additional risk on guest numbers.

Since re-opening is very expensive, we submitted another suggestion to the government about a re-opening grant, but we failed. Despite all the difficulties, most of our members survived. I would not predict future bankruptcies, but I am sure many of us overestimate the rate. We will not have as much as many expect.

BBJ: How is re-hiring going on? Are there any shortages in professions?

TF: Chefs and housemaids are almost impossible to find. Many professionals migrated into other sectors, where they are better paid, have more stability, and

GM Case Study: Balázs Kovács, CEO, Danubius Hotels It is vital to gain travelers’ confidence under the current, changed market conditions. Hygiene plays a significant role in this and creating the conditions for safe travel, which is why we created our Safe Stay protocol. In addition to increased hygiene rules, non-contact services have come to the fore, both in guest information and hospitality. Travelers have notably become more cautious, so we do everything we can to enhance their sense of security.

While in the winter we offered hotel office (RoomOffice) and “home catering” (FoodPack) services, we are currently tailoring our offers to satisfy the desire to travel. Our goal is to offer solutions for those arriving in the capital for leisure purposes to gather the travel experience desired and also for business guests, where there is a definite need for personal meetings.

To achieve this, Danubius Hotels

now offers flexible conditions never seen before, hybrid technology, and convenient and safe on-site services.

Moving forward, we see a double trend: domestic demand in the countryside hotels will undoubtedly be very strong; however, the capital is still relatively weak. To get something started, we also need international guests, business travelers, and major events. This requires uniform and transparent regulations.

European tourism may be cautious, but we expect a domestic start around July-August. Even if there is an upswing over the summer, the recovery in the capital will be a much longer process, involving many difficulties due to its exposure to the pandemic. Overseas, Asian travelers and a large number of conferences may arrive in larger volumes next year, but the 2021 tourism “season” is likely to pass without them.

4 without night shifts and weekends or holiday season work. However, they are uncertain and wait due to the instability in the tourism sector. The whole industry is characterized by anxiety.

BBJ: Are there any steps to minimize the risk exposure of the sector?

TF: Travel is the most risk-sensitive industry for various reasons. In the case of a financial crisis, the first thing people will hold back on is leisure. Secondly, natural disasters can have a global effect.

Remember when Eyjafjallajökull, a small volcano in Iceland, erupted in 2010, causing enormous disruption to air travel?

We cannot prepare for these events. Banks usually put travel and tourism in the riskiest categories in terms of investment due to their volatility. I would not expect any considerable change in this.

BBJ: Are there any measures that can help, such as diversification, portfolio expansion, or reconstruction?

TF: Automation will probably help the most as it can replace the most critical human factor; however, I do not prefer this. Travel is about people and personal contacts. But I see no other solution.

In Western Europe, there are no hotel receptions; you enter the building using a code and an online check-in, with an emergency phone number in case you really need it. The human workforce is scarce and expensive there too. In Hungary, we still operate with a 24-hour reception, but maybe not for that much longer. In restaurants, high-tech cooking machines will likely be able to prepare food, with relatively little human intervention. This will not be fine dining, of course, but it will be OK in general.

Robotics is also a solution. Certain parts of hotels can be cleaned with robots, for instance, except rooms, and we have many rooms; this will always be a problem. But restructuring and specialization are a mainstream trend.

BBJ: What about sustainability in the sector?

TF: It is there, but the process is slow.

Trends with well-defined economic benefits such as keeping bed linen and bathroom towels in the room for two or three days will be more popular, even in five-star accommodation. The other part involves new investments and newly built establishments where environmentallyconscious technologies and innovations such as heat pumps and solar panels will be incorporated to reduce carbon footprints, although their rate of return is still questionable. Train and short-distance car trips will also surge in popularity, while catering is likely to consolidate in number.

Finally, the event industry will likely go hybrid, and trips will fall in number, adding to green consciousness.

BBJ: How is the legal environment for the industry?

TF: No one likes red tape, but Hungary is still quite OK in this. The Hungarian authorities are much more serviceoriented compared to many other European peers. In general, this is good, and it is important as it is a time-consuming issue. And tendering in Hungary is also very active. Many

Special Report | 19 tenders are available, which can indirectly affect the labor market.

BBJ: When can we expect a return to profit?

TF: Last year, we predicted growth from September based on increasing trend figures. Our master plan collapsed due to the lockdown. This spring looks much better, but honestly, I expect we will recover turnover only from 2023. The operating profit is another question since raw materials and labor costs have seen double-digit increases recently. To match the 2019 results, we should realize considerably higher income figures, which will take years. To sum up, I would augur profits perhaps by 2025.

GM Case Study: Péter Mácsai, Cluster Manager, Ensana Hotels Hungary As Europe’s largest operator of health spas, we have developed new products such as Wellness Relief, Immunity Booster, and Respiratory packages, which deal with stress and post-COVID symptoms after the pandemic and the home office/quarantine period.

Contactless solutions have been introduced to our hotel operations, such as QR code food and beverage menus, an electronic service guide instead of a printed one, and invoices sent by e-mail when checking out.

Our hotel operations are in full compliance with the current public health regulations, the hotel staff is service-oriented, guests can expect flexible booking conditions in parallel with market conditions, and our housekeeping staff pays maximum attention to cleanliness and hygiene. We hope that after the pandemic, our full range of services will remain available and bookable. Our technicians and sales professionals are also well prepared for online and hybrid events. Given our current occupancy forecasts for several months in advance, corporate partners can expect a high willingness on the hotel side to agree on LRA (last room available) conditions upon signing the yearly corporate contracts!

We expect the domestic corporate market to start in the short term, although with a slow growth rate. Hotels will need to wait several more months for international market bookings.

According to our calculations, in the 2nd quarter of 2022, there will be a more noticeable recovery in this area. Online solutions mastered during the home office period will certainly reduce corporate travel needs, which is also not supported by the economic crisis in some industries caused by the pandemic.

In short, we expect a slow recovery of up to several years for our corporate businesses.

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www.bbj.hu

Budapest Business Journal | July 2 – July 15, 2021

Special Report | 21

Five-star Hotels in Budapest Ranked by number of rooms

SINGLE RATE (EURO/NIGHT) DOUBLE RATE (EURO/NIGHT)

9,091 (2019)

199 459

402 A 26 12

2,078

199 239

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BUDAPEST MARRIOTT HOTEL / DUNA SZÁLLODA ZRT.

364 478 22 16

2,928

250 280

✓

✓

–

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–

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KEMPINSKI HOTEL CORVINUS BUDAPEST / KEMPINSKI HOTEL BUDAPEST ZRT.

363 706 38 10

8,777 (2019)

250 450

✓

✓

✓

✓

–

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HILTON BUDAPEST / DANUBIUS HOTLELS ZRT.

332 464 25 23

836

250 280

–

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–

–

THE AQUINCUM HOTEL BUDAPEST / THERMAL HOTEL AQUINCUM ZRT.

310 620 8 14

2,858 (2019)

285 285

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HILTON BUDAPEST CITY / WESTEND SZÁLLODAÜZEMELTETŐ KFT.

230 A 21 13

3,262 (2019)

229 249

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8

HILTON GARDEN INN BUDAPEST / HOTEL YASMIN BUDAPEST KFT.

214 A A A

505

A A

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✓

9

ANANTARA NEW YORK PALACE BUDAPEST HOTEL / NEW YORK PALACE KFT.

185 185 30 11

9,291 (2019)

390 440

179 358 19 5

9,248 (2019)

520 520

2

www.budapest.intercontinental.com

3

www.marriottbudapest.com

4

www.kempinski.com

5

www.budapest.hilton.com

6

www.aquincumhotel.com

7

www.budapest-city.hilton.com

www.hilton.com/en/hotels/budccgi-hiltongarden-inn-budapest-city-centre/

www.nh-hotels.com/hotel/anantara-new-yorkpalace-budapest-hotel

FOUR SEASONS HOTEL GRESHAM PALACE BUDAPEST / 10 SAS MAGYARORSZÁG VAGYONKEZELŐ KFT. www.fourseasons.com/budapest

✓

✓

Bar, fitness

1994 2019

– CEE Property-Invest Inmobilien GmbH (100)

Arne Klehn John Majosi János Parti

1052 Budapest, Apáczai Csere János utca 4.

(1) 486-5000 budapest.ays@marriott.com

✓

✓

✓

Terraces, laundry, car wash, fitness room

1989 2021

Kempinski Hotel Budapest Zrt. (100) –

Stephan Interthal Zoltán Schubert Judit Dénes

1051 Budapest, Erzsébet tér 7–8.

(1) 429-3777 hotel.corvinus@kempinski.com

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–

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1976 2018

– CP Holdings Ltd. (100)

Peter Knoll Katalin Miszkiewicz Éva Keller

1014 Budapest, Hess András tér 1–3.

(1) 889-6600 info.budapest@hilton.com

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✓

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1991 2018

– Corinthia Investments Ltd. (100)

Philippe Mahuas – –

1036 Budapest, Árpád fejedelem útja 94.

(1) 436-4100 info@aquincumhotel.com

–

–

✓

✓

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2000 2015

Gránit Pólus Group (100) –

Mehdi Othmani – –

1062 Budapest, Váci út 1–3.

(1) 288-5500 info.budapestcity@hilton.com

–

–

✓

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–

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Fitness

2019 2019

– Longbridge group (100)

Manuela Brode – –

1065 Budapest, Lázár utca 11-13.

(1) 211-3050 info.gardeninnbudapest@ hilton.com

–

2009 2019

– Covivio (100)

Tamás Fazekas – –

1073 Budapest, Erzsébet körút 9-11.

(1) 886-6111 customer.nypalace@ dahotels.com

–

2004 2020

– (100)

Yves Giacometti – –

1051 Budapest, Széchenyi István tér 5–6.

(1) 268-6000 budapest.pbx@ fourseasons.com

OTHER

1052 Budapest, Apáczai Csere János utca 12–14.

(1) 327-6333 budapest@ihg.com

EVENTS

Marten Schoenrock Éva Alexa –

CAR RENTAL

Fitness room

– Al Habtoor Group (100)

INTERNET IN ROOMS

✓

1981 2018

GARAGE

1073 Budapest, Erzsébet körút 43–49.

(1) 479-4000 budapest@corinthia.com

BEAUTY SALON

Jonathan Pace Csaba Pálos –

WELLNESS

– International Hotel Investments Plc. (100)

FAMILY FRIENDLY

INTERCONTINENTAL BUDAPEST / AL HABTOOR GROUUP

www.corinthia.com

2002 2019

RESTAURANT

CORINTHIA BUDAPEST / IHI MAGYARORSZÁG ZRT.

OWNERSHIP (%) HUNGARIAN NON-HUNGARIAN

BUSINESS CORNER

1

HOTEL NAME NAME OF OPERATING COMPANY WEBSITE

YEAR ESTABLISHED YEAR LAST RENOVATED

TOTAL NET REVENUE IN 2020 (HUF MLN)

407 A 31 28

RANK

NO. OF ROOMS NO. OF BEDS NO. OF SUITES NO. OF MEETING ROOMS

SERVICES

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–

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–

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–

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✓

TOP LOCAL EXECUTIVE CFO MARKETING DIRECTOR

ADDRESS PHONE EMAIL

22 | 4

Special Report

www.bbj.hu

Budapest Business Journal | July 2 – July 15, 2021

Five-star Hotels in Budapest Ranked by number of rooms

SINGLE RATE (EURO/NIGHT) DOUBLE RATE (EURO/NIGHT)

4,825 (2019)

370 390

NEW YORK RESIDENCE / 12 NEW YORK PALACE KFT.

138 269 138 NA

9,291 (2019)

250 250

MATILD PALACE, A LUXURY COLLECTION HOTEL, BUDAPEST / 13 MELIS OPERATION KFT.

130 152 19 4

NA

A A

✓

✓

✓

✓

✓

–

✓

110 230 18 4

754

438 498

–

✓

✓

✓

✓

–

108 216 – –

2,928

160 160

–

–

✓

✓

✓

82 96 2 3

500 (2019)

130 150

–

✓

–

✓

50 A A 1

782 (2019)

A A

–

✓

–

49 52 5 2

415

360 360

–

✓

ST. GEORGE RESIDENCE ALL SUITE HOTEL DE LUX / ST GEORGE APARTMANHÁZ KFT.

26 52 26 2

72 (2019)

129– 269 229– 279

✓

BALTAZÁR BOUTIQUE HOTEL /

11 22 4 1

A

100– 300 100– 300

✓

www.nh-hotels.com/hotel/anantara-new-yorkpalace-budapest-hotel

www.matildpalace.com

PÁRISI UDVAR HOTEL BUDAPEST /

14 PÁRIZS PROPERTY KFT. www.parisiudvarhotel.com

MARRIOTT EXECUTIVE APARTMENTS /

15 DUNA SZÁLLODA ZRT. www.marriottbudapest.com

MYSTERY HOTEL BUDAPEST /

16 MYSTERY HOTEL BUDAPEST KFT. www.mysteryhotelbudapest.com

IBEROSTAR GRAND BUDAPEST /

17 IBEROSTAR HUNGARY KFT. www.iberostar.com

ARIA HOTEL BUDAPEST /

18 IK HOTELS KFT. www.ariahotelbudapest.com

19

www.stgeorgehotel.hu

20 ZSIDAI CSOPORT www.baltazarbudapest.com

✓

✓

Spago Budapest

by Wolfgang Puck, Matild Café & Carabet, The Duchess

2021 2021

Melis Investment Kft. (100) –

Emre Pasli Gokhan Gürbüz Selim Ölmez

1056 Budapest, Váci utca 36.

(1) 550-5000 inquiries@matildpalace.com

✓

✓

✓

–

2019 –

Párizs Property Kft. (100) –

Andrea Schwindt-Kiss – –

1052 Budapest, Petőfi Sándor utca 2–4.

(1) 576-1600 info@parisiudvarhotel.com

–

✓

–

–

–

1997 2018

– CEE PROPERTYINVEST Immobilien GmbH (100)

Arne Klehn John Majosi János Parti

1052 Budapest, Piarista utca 4.

(1) 235-4888 budapest.reservations@ marriott.com

–

–

✓

✓

✓

–

2019 2019

(100) –

Zoltán Árvai Noémi Várady Viktória Berényi

1064 Budapest, Podmaniczky utca 45.

(1) 616-6000 mystery@ mysteryhotelbudapest.com

✓

–

–

✓

–

✓

–

2011 2020

– IBEROSTAR Hotels & Resorts (100)

Antonio Montoro Ramírez – –

1051 Budapest, Október 6. utca 26.

(1) 354-3050 grand.hotel.budapest@ iberostar.com

–

✓

✓

–

✓

–

✓

–

2015 2019

IBE Kft. (50) Henry Kallan (50)

István Lukács – –

1051 Budapest, Hercegprímás utca 5.

(1) 445-4055 stay@ariahotelbudapest.com

✓

✓

–

–

✓

✓

✓

✓

–

2007 2017

– (100)

Gábor Jusztin – –

1014 Budapest, Fortuna utca 4.

(1) 393-5700 info@stgeorgehotel.hu

–

–

–

–

–

✓

–

✓

–

2013 –

Zsidai Group (100) –

Zoltán Roy Zsidai – –

1014 Budapest, Országház utca 31.

(1) 300-7051 hello@baltazarbudapest.com

OTHER

1073 Budapest, Osvát utca 2–8.

(1) 424-4700 customer.nyresidence@ dahotels.com

EVENTS

Tamás Fazekas – –

CAR RENTAL

–

– Convivio (100)

INTERNET IN ROOMS

–

2011 2018

GARAGE

1051 Budapest, Erzsébet tér 9–10.

(1) 429-5500 budapest@ritzcarlton.com

BEAUTY SALON

Thomas Schwall – –

WELLNESS

– Al Habtoor Group LLC (100)

FAMILY FRIENDLY

2016 2016

RESTAURANT

THE RITZ-CARLTON, BUDAPEST /

11 ADRIA PALACE KFT. www.ritzcarlton.com/budapest

OWNERSHIP (%) HUNGARIAN NON-HUNGARIAN

BUSINESS CORNER

HOTEL NAME NAME OF OPERATING COMPANY WEBSITE

YEAR ESTABLISHED YEAR LAST RENOVATED

TOTAL NET REVENUE IN 2020 (HUF MLN)

171 222 29 5

RANK

NO. OF ROOMS NO. OF BEDS NO. OF SUITES NO. OF MEETING ROOMS

SERVICES

–

✓

✓

✓

–

–

✓

–

✓

–

–

✓

✓

–

–

✓

✓

–

TOP LOCAL EXECUTIVE CFO MARKETING DIRECTOR

ADDRESS PHONE EMAIL

4

www.bbj.hu

Budapest Business Journal | July 2 – July 15, 2021

Special Report | 23

Five-star Hotels Outside Budapest Ranked by number of rooms

TOTAL NET REVENUE IN 2020 (HUF MLN)

SINGLE RATE (EURO/NIGHT) DOUBLE RATE (EURO/NIGHT)

BUSINESS CORNER

WELLNESS

BEAUTY SALON

FAMILY FRIENDLY

GARAGE

INTERNET IN ROOMS

CAR RENTAL

EVENTS

POOLS

THERAPY

MASSAGE

OTHER

YEAR ESTABLISHED YEAR LAST RENOVATED

1

NO. OF ROOMS NO. OF SUITES NO. OF MEETING ROOMS

RANK

SERVICES

OWNERSHIP (%) HUNGARIAN NON-HUNGARIAN

254 17 6

3,191

180 296

✓

✓

✓

–

–

✓

–

✓

✓

✓

✓

–

2008 2020

– (100)

Krisztina Kozó András Kósi Veronika Németh

9600 Sárvár, Vadkert körút 5.

(95) 889-500 info@spirithotel.hu

LOTUS THERME HOTEL & SPA / HOTEL GARDEN KFT.

222 10 5

1,268

125 220

–

✓

✓

–

–

✓

✓

✓

✓

✓

✓

Tennis court

1996 2021

– (100)

Attila Fülöp Mónika Póka Viktor Kosztolánczi

8380 Hévíz, Lótuszvirág utca 1.

(83) 500-500 info@lotustherme.net

HOTEL DIVINUS / DIVINUS HOTEL ÜZEMELTETŐ KFT.

149 9 10

528

120 145

✓

✓

✓

✓

✓

✓

✓

✓

✓

–

✓

Snooker, darts, table tennis, fitness room

2008 2021

Divinus Hotel Üzemeltető Kft. (100) –

János Szücs – –

4032 Debrecen, Nagyerdei körút 1.

(52) 510-900 info@hoteldivinus.hu

KASTÉLYHOTEL SASVÁR RESORT / -

58 5 A

A

A A

–

✓

–

✓

–

✓

–

✓

✓

✓

✓

–

1998 A

(100) –

András Szélessy – –

3242 Parádsasvár, Kossuth utca 1.

(30) 424-4444 info@khs.hu

ANDRÁSSY REZIDENCIA WINE & SPA / TÉMADESIGN KFT.

38 3 1

333

140 180

–

✓

✓

–

–

✓

–

✓

✓

–

✓

–

2008 2021

(100) –

Zoltán Kiss – Mónika Dusek

3915 Tarcal, Fő utca 94.

(47) 580-015 hotel@andrassykuria.hu

BOTANIQ TURAI KASTÉLY / BDPST HOTEL ZRT.

19 A A

42

279 321

✓

✓

✓

✓

–

✓

–

✓

✓

–

✓

–

2020 2020

BDPST group (100) –

Örs Csizmadia – –

2194 Tura, Park utca 37.

(28) 799-130 info@botaniqcastle.com

HERTELENDY KASTÉLY / HERTELENDY KASTÉLYSZÁLLÓ KFT.

17 3 3

170

250 350

✓

✓

✓

✓

✓

✓

–

✓

✓

–

✓

–

2007 2020

– Koller Group Holding (100)

István Gyenesei – –

7541 Kutas-Kozmapuszta, 0120/4.

(82) 568-400 exclusive@ hertelendy-castle.com

FORGÁCH KASTÉLY / WORLD TRANSIT KFT.

12 A A

553 (2019)

139– 350 139– 350

✓

✓

✓

✓

–

✓

–

✓

✓

✓

✓

–

2010 –

Individuals (100) –

Ferenc Szabó – –

4644 Mándok, Szent István tér 9.

(70) 677-0131 info@forgachkastely.hu

HOTEL NAME NAME OF OPERATING COMPANY WEBSITE

SPIRIT HOTEL THERMAL SPA SUPERIOR / SPIRIT HOTEL GYÓGYSZÁLLODA KFT. www.spirithotel.hu

2

www.lotustherme.net

3

www.hoteldivinus.hu

4

www.khs.hu

5

www.andrassykuria.hu

6

www.botaniqkastely.hu

7

www.hertelendy-castle.com

8

www.forgachkastely.hu

TOP LOCAL EXECUTIVE CFO MARKETING DIRECTOR

ADDRESS PHONE EMAIL

24 | 4

Special Report

www.bbj.hu

Budapest Business Journal | July 2 – July 15, 2021

Four-star Hotels in Budapest Ranked by number of rooms

3

✓

✓

✓

✓

✓

4

INTERCITYHOTEL BUDAPEST / STAG HOTELS HUNGARY KFT.

312

NA

A A

✓

–

–

✓

✓

✓

✓

✓

–

–

www.budapest.intercityhotel.com

5

AQUAWORLD RESORT BUDAPEST / AQUAWORLD HOTEL ÉS ÉLMÉNYFÜRDŐ SZOLGÁLTATÓ ZRT.

309

3,060

A A

✓

✓

✓

✓

✓

✓

–

✓

✓

✓

✓

✓

✓

✓

–

OWNERSHIP (%) HUNGARIAN NON-HUNGARIAN

A

Danubius Hotels Zrt. (100) –

1990

5 Hotel Ingatlanhasznosító Kft. (100) –

–

1982

Accor-Pannonia Hotels Zrt. (100) –

Jean Wendling

Bistro Lounge & Bar, BistroBox

2021

– (100)

Tibor Polgár

2006

Aquaworld Zrt. (100) –

OTHER

✓

✓

✓

THERAPY

✓

✓

–

POOLS

✓

✓

✓

EVENTS

✓

✓

✓

CAR RENTAL

✓

www.novotel.com

✓

✓

INTERNET IN ROOMS

69–88 69–88

✓

✓

GARAGE

319

24,615 (2019)

✓

BEAUTY SALON

NOVOTEL BUDAPEST CITY / ACCOR-PANNONIA HOTELS ZRT.

www.mercure.com

✓

YEAR ESTABLISHED

2

MERCURE BUDAPEST KORONA / ACCOR-PANNONIA HOTELS ZRT.

✓

FAMILY FRIENDLY

54–116 67–117

www.danubiushotels.com

WELLNESS

421

24,615 (2019)

1

HOTEL HUNGARIA CITY CENTER / DANUBIUS HOTELS ZRT.

BUSINESS CORNER

SINGLE RATE (EURO/NIGHT) DOUBLE RATE (EURO/NIGHT)

791

HOTEL NAME NAME OF OPERATING COMPANY WEBSITE

NO. OF ROOMS 499

66–76 70–95

RANK

TOTAL NET REVENUE IN 2020 (HUF MLN)

SERVICES

–

–

Massage

TOP LOCAL EXECUTIVE

Zoltán Bogár

Gergely Kolling

Roland Sivó

www.aquaworldresort.hu

6

CONTINENTAL HOTEL BUDAPEST / JOY HOTELS KFT.

272

www.continentalhotelbudapest.com

2,785 (2019)

100 109–209

✓

✓

✓

✓

✓

✓

✓

✓

✓

✓

✓

–

–

✓

✓

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–

✓

–

–

7

DANUBIUS HOTEL HELIA / DANUBIUS HOTELS ZRT.

262

791

66–152 66–152

8

MERCURE BUDAPEST CASTLE HILL / ACCOR-PANNONIA HOTELS ZRT.

250

24,615 (2019)

A A

www.danubiushotels.com/hu/szallodakbudapest/danubius-hotel-helia/

www.mercure.com

9

RADISSON BLU BÉKE HOTEL / DANUBIUS HOTELS ZRT.

NOVOTEL BUDAPEST CENTRUM /

COURTYARD BY MARRIOTT BUDAPEST CITY CENTE / 11 CPI HOTELS EUROPEUM KFT.

K+K HOTEL OPERA /

–

–

✓

✓

–

✓

✓

–

2010

Joy Hotels Kft. (100) –

–

1990

Danubius Hotels Zrt. (100) –

Áron Szabó

–

1982

– (100)

Zsombor Jávorka

Massage

Zoltán Géher

1053 Budapest, Kecskeméti utca 14.

(1) 486-8800 h1765@accor.com

1123 Budapest, Alkotás utca 63–67.

(1) 372-5400 h0511@accor.com

1087 Budapest, Baross tér 7–8.

(1) 279 9000 budapest@intercityhotel.com

1044 Budapest, Íves út 16.

(1) 231-3600 reservation@ aquaworldresort.hu

1074 Budapest, Dohány utca 42–44.

(1) 815-1000 continentalinfo@ zeinahotels.com

1133 Budapest, Kárpát utca 62–64.

(1) 889-5800 helia@danubiushotels.com

1013 Budapest, Krisztina körút 41–43.

(1) 488-8100 h1688@accor.com

1067 Budapest, Teréz körút 43.

(1) 889-3900 manager.budapest@ RadissonBlu.com

791

52–76 52–86

✓

✓

✓

✓

✓

✓

✓

✓

✓

✓

–

1914

Danubius Hotels Zrt. (100) –

Áron Szabó

227

24,615 (2019)

65–85 65–85

✓

✓

✓

✓

✓

✓

✓

✓

✓

✓

–

2002

Accor-Pannonia Hotels Zrt. (100) –

Lajos Czár

1088 Budapest, Rákóczi út 43–45.

(1) 477-5300 h3560@accor.com

216

545

120 130

✓

✓

–

✓

✓

✓

–

✓

–

–

Gymnasium, sauna, steam chamber

2017

– (100)

Gergő Franciscy

1088 Budapest, József körút 5.

(1) 327-5100 reception.mbcc@cpihotels.com

200

2,092 (2019)

120 120

✓

✓

✓

✓

✓

✓

✓

✓

✓

✓

–

1993

– K+K Hotels GmbH, K+K Management GmbH (100)

Gergely Dobos

1065 Budapest, Révay utca 24.

(1) 269-0222 kk.hotel.opera@kkhotels.hu

www.marriott.com/hotels/travel/budcycourtyard-budapest-city-center

12 K+K HOTEL KFT. www.kkhotels.com

✓

1074 Budapest, Rákóczi út 90.

(1) 889-4400 hungaria.booking@ danubiushotels.com

247

www.danubiushotels.com

10 ACCOR-PANNONIA HOTELS ZRT. www.novotel.com

✓

ADDRESS PHONE EMAIL

4

www.bbj.hu

Budapest Business Journal | July 2 – July 15, 2021

Special Report | 25

Four-star Hotels Outside Budapest Ranked by number of rooms TOTAL NET REVENUE IN 2020 (HUF MLN)

SINGLE RATE (EURO/NIGHT) DOUBLE RATE (EURO/NIGHT)

BUSINESS CORNER

WELLNESS

BEAUTY SALON

FAMILY FRIENDLY

GARAGE

INTERNET IN ROOMS

CAR RENTAL

EVENTS

POOLS

THERAPY

MASSAGE

OTHER

YEAR ESTABLISHED YEAR LAST RENOVATED

1

NO. OF ROOMS NO. OF SUITES NO. OF MEETING ROOMS

RANK

SERVICES

OWNERSHIP (%) HUNGARIAN NON-HUNGARIAN

300 30 7

777

85–105 110–180

✓

✓

✓

✓

✓

✓

✓

✓

✓

✓

✓

Lakeside, sports center, animation, conference venue

1985 2015

(86) (14)

Tamás Károly – –

8237 Tihany, Rév utca 3.

(87) 538-500 reserv@clubtihany.hu

HOTEL KAROS SPA / KAROSINVEST ZRT.

298 8 5

980

87 146

–

✓

✓

✓

✓

✓

–

✓

✓

✓

✓

–

2004 2019

Karosinvest Zrt. (100) –

Botond Üsztöke – –

8749 Zalakaros, Alma utca1.

(93) 542-550 sales@karos-spa.hu

NATURMED HOTEL CARBONA / HOTEL CARBONA ZRT.

1,059

90-144 180-228

–

✓

✓

✓

–

✓

✓

✓

✓

✓

✓

–

www.carbona.hu

250 10 3

1997 2020

Hotel Carbona Zrt. (100) –

Zsuzsa Müller-Pápai András Kósi Klaudia Varga

8380 Hévíz, Attila utca 1.

(83) 501-500 hotel@carbona.hu

PARK INN BY RADISSON ZALAKAROS HOTEL & SPA / Z.I.P HOTEL KFT.

239 25 2

1,371

90-130 110–170

–

✓

✓

✓

✓

✓

–

✓

✓

✓

✓

–

2015 2017

(100) –

Tibor Horváth – –

8749 Zalakaros, Üdülősor 1.

(93) 920-103 info.zalakaros@parkinn.com

PARK INN BY RADISSON SÁRVÁR RESORT & SPA / P.S. HOTEL KFT.

236 A A

1,627

A A

–

✓

✓

✓

✓

✓

–

✓

✓

✓

✓

–

2006 2020

P.S. Hotel Kft. (100) –

Bálint Tölli – Péter Szijjártó

9600 Sárvár, Vadkert körút 4.

(95) 530-100 info.sarvar@parkinn.com

THERMAL AQUA ENSANA HEALTH SPA HOTEL / ENSANA S.R.O.

231 6 1

791

115–150 115–150

✓

–

1984 2015

Danubius Hotels Zrt. (100) –

Rita Nagy – –

8380 Hévíz, Kossuth Lajos utca 13–15.

(83) 889-500 aqua.reservation@ danubiushotels.com

–

✓

✓

✓

–

✓

✓

✓

✓

✓

✓

Salt cabin, sauna

2003 2015

Hunguest Hotels Zrt. (100) –

Szabolcs Szabó – –

8300 Tapolca, Köztársaság tér 10.

(87) 513-100 hotelpelion@ hunguesthotels.com

HOTEL NAME NAME OF OPERATING COMPANY WEBSITE

CLUB TIHANY / CLUB TIHANY ÜDÜLŐKÖZPONT ZRT. www.clubtihany.hu

2

www.karos-spa.hu

3

4

www.parkinnzalakaros.hu

5

www.parkinnsarvar.hu

6

www.danubiushotels.hu/aqua

✓

✓

✓

✓

✓

✓

✓

✓

✓

✓

TOP LOCAL EXECUTIVE CFO MARKETING DIRECTOR

ADDRESS PHONE EMAIL

HUNGUEST HOTEL PELION / HUNGUEST HOTELS ZRT.

228 A A

12,256

83 132

HOTEL EURÓPA FIT / HÉVINVEST SPA-GOLF ZRT.

225 6 3

1,379

113 186

–

✓

✓

✓

✓

✓

✓

✓

✓

✓

✓

Sports, anumation, bike rental, solarium, sauna world, transfer, electric car filling station

2000 2019

Hévinvest Spa-Golf Zrt. (100) –

Ferenc Horváth – –

8380 Hévíz, Jókai utca 3.

(83) 501-100 sales@europafit.hu

HOTEL EGER & PARK / EGER PARK HOTEL KFT.

214 A A

1,013

48 90

✓

✓

–

✓

✓

✓

–

✓

✓

✓

✓

–

2000 2017

Eger Invest Zrt. (87.30) Eger East-West Zrt. (12.30) –

Judit Harmati – –

3300 Eger, Szálloda utca 1–3.

(36) 522-200 info@hotelegerpark.hu

210 7 7

791

100–150 100–150

✓

✓

✓

✓

✓

✓

✓

✓

✓

✓

–

Bike rental, gift shop

1976 2015

Danubius Hotels Zrt. (100) –

Rita Nagy – –

8380 Hévíz, Kossuth Lajos utca 9–11.

(83) 889-400 heviz.researvation@ danubiushotels.com

11 HOTEL GOLF KFT. www.greenfieldhotel.hu

207 13 6

498

126 168

✓

✓

✓

✓

–

✓

–

✓

✓

✓

✓

Transfer, bike rental, electric scooter rental, sports programs

2004 2016

MINERVA Befektetési Alapkezelő Zrt. (100) –

Tamás Sáfrány – –

9740 Bük, Golf utca 4.

(94) 801-600 reservation@greenfieldhotel.hu

SALIRIS RESORT SPA ÉS KONFERENCIA HOTEL / 12 HUNGUEST HOTELS ZRT.

204 10 6

✓

Lake, running court, volleyball court, playground, playrooms, bike rental, e-scooter rental, sauna world, animation

2005 2016

Hunguest Hotels Zrt. (100) –

Katalin Szabó – –

3394 Egerszalók, Forrás utca 4.

(36) 688-600 sales@salirisresort.hu

7

www.hotelpelion.hunguesthotels.hu

8

www.europafit.hu

9

www.hotelegerpark.hu

THERMAL HÉVÍZ ENSANA HEALTH SOA HOTEL / 10 ENSANA S.R.O.

www.danubiushotels.com/heviz

GREENFIELD HOTEL GOLF & SPA /

www.salirisresort.hu

12,256

90–120 120–150

✓

✓

✓

✓

✓

✓

✓

✓

✓

✓

5

www.bbj.hu

Budapest Business Journal | July 2 – July 15, 2021

Socialite Moby Invites Budapest Art Orchestra to Contribute to new Album

When it came time to look back over a career in music that spans three decades, superstar musician and DJ Moby had no intention of simply putting together a conventional greatest hits package.

Excellent Reputation

DAVID HOLZER

His new album “Reprise,” released on CD, vinyl, and cassette on the prestigious Deutsche Grammophon label on May 28, finds this restless artist revisiting and reimagining hits from his past such as “Natural Blues,” “Why Does my Heart Feel so Bad?,” and “We are all Made of Stars.”

To help him reimagine his hits, he works with an eclectic list of guest artists, including Kris Kristofferson, Mark Lanegan, and our own Budapest Art Orchestra.

The highly regarded orchestra comprises world-class musicians from Budapest who have a feel for music from every genre. They record symphonic orchestral recordings for movies, series, albums, pop albums, jazz, and classical pieces.

While it proved impossible to ask Moby why he chose to rework his danceoriented hits in classical music settings,

they recorded were originally dance music. As Lukacs says, “They’re open to playing in all kinds of genres and love this type of music.”

Budapest Art Orchestra is also extremely busy, so the musicians are playing to different briefs pretty much every day.

“Tomorrow, we’re doing a project with an artist from New York,” Lukacs explains. “After that, we’re doing a Belgian movie. Last week we worked on a Chinese animated movie. Every project is so different. Sometimes we’ll just have 20 string instruments, other times we’ll have 40 or 50, and on occasion, it might be a full 70-piece orchestra and a 40-piece choir.”

I tell Lukács that, although I’m aware of the high standard of professional musicianship in Hungary, I was nevertheless impressed and a little surprised to see the Budapest Art Orchestra playing with Moby.

he has written that “I long for the simplicity and vulnerability you can get with acoustic or classical music.”

The publicity material for the album describes exploiting “the bombastic potential an orchestra can offer.”

Intrigued by how the Budapest Art Orchestra came to feature on “Reprise,” I got in touch with the music producer and CEO of East Connection Music Recording Miklós Lukács, who organized the recording session at Studio 22 of the Hungarian National Radio building.

Orchestral Maneuvers

For the past 12 years, Lukács has been organizing recording sessions for the orchestra in Budapest for movies,

“Hungarian musicians enjoy an excellent reputation, you know,” Lukacs says.

“It’s because our musicians are really talented, and we have a great educational system for music in this country. Put this all together, and you have a high number of really amazing artists who can perform anywhere in the world at the highest levels.”

There’s no question that the contribution of the Budapest Art Orchestra helps elevate “Reprise” to a much more intriguing level than if it had just been a collection of remastered or unimaginatively TV series, and albums. One of his re-recorded greatest hits. contacts will explain the particular For example, when the Budapest Arts orchestral line-up required for a Orchestra fades in midway through the session, the number of musicians and dance number “Go,” they immediately the instruments they need, and Lukács turn it into something with powerful arranges the sessions. emotional overtones. On “Porcelain,” “The sessions with Moby came about they help give it a cinematic grandness. when one of our contacts in Los Angeles Along with singer-songwriter Mindy reached out to me and mentioned that Jones, the subtle coloring they add to a they wanted to do something with him version of “Heroes,” the track by Moby’s and us,” Lukacs told me. hero and friend David Bowie that has “This was back in early 2020 become almost overfamiliar, transforms before COVID-19 kicked in. The it back into something genuinely moving conductor, Joseph Trapanese, flew and poignant. in from Los Angeles. Some technical For me, the standout track, which personnel also came over from powerfully illustrates Moby’s audacity Air Studios in London, including in reimagining his songs, is “The Geoff Foster. We recorded the sessions Lonely Night,” originally on his 2013 over two days in February 2020, album “Innocents.” and Moby listened to them in Los This version has vocals by gravelAngeles later. voiced American singer-songwriter “Often, clients listen in to the Mark Lanegan and the 85-year-old Kris recordings in real-time, but for this Kristofferson, whose voice is impossibly project, that wasn’t necessary because rich and weathered. The playing of Trapanese, the conductor, was also the the Budapest Art Orchestra perfectly arranger and could judge right away if complements the grit in the two men’s he’d got what he wanted.” voices and the poetic lyrics, which are Trapanese has impressive credentials, about the dark night of the soul. having worked on movies as varied as As Moby says in a “making of” “Divergent,” “Straight Outta Compton,” video for the track on his website, and “Transformers: Age of Extinction.” the playing of the Budapest Art He previously worked with Moby in Orchestra is “phenomenal.”

2000 on sessions for “Porcelain” and “Natural Blues.”

Geoff Foster’s track record, meanwhile, You can read more about the includes scoring the movies “Gone Girl,” making of the album “Reprise” “The Great Gatsby,” and “The Pirates of and how Moby worked with the Caribbean” franchise. the Budapest Art Orchestra in The musicians themselves enjoyed the “New” section of moby.com. the sessions, even though the tracks

5

www.bbj.hu

Budapest Business Journal | July 2 – July 15, 2021

Socialite | 27

Wine Industry Witnesses Mainly Domestic Tourism Revival Hungarian wineries and wine bars are experiencing a rise in visitor numbers, although they look set to welcome mainly domestic visitors in the short run, with a few exceptions.

ROBERT SMYTH

László Mészáros, managing director of Tokaj’s French-owned Disznókő, the first major estate you encounter as you enter the Tokaj region on the road from Budapest, and one which is delightfully surrounded by its own sloped vineyards, described two main sides to tourism.

“There are those visitors coming to taste the wines on the estate and those who travel to Budapest and buy wines in wine bars, restaurants, or at the airport, and the latter will be extremely limited,” he tells the Budapest Business Journal.

He is more sanguine about domestic tourism, however.

“I’m quite optimistic that domestic tourism will happen. Mostly Hungarians will come and visit,” he says. Foreign visitors to the estate will certainly be missed as they tend to buy the more expensive wines.

“Hungarian visitors usually buy wines for everyday consumption but less in the way of Aszú [Tokaj’s signature botrytized sweet wine], which foreigners often buy,” he says.

Before the COVID pandemic, Taste Hungary was a dynamically expanding company, owned and run by the husband and wife team of Gábor and Carolyn Bánfalvi. They employed more than 30 guides and sommeliers, taking guests on wine and food market tours and running regular tastings at their cellar room called the Tasting Table, at Bródy Sándor utca 9.

Now, it has just two full-time sommeliers, having unsurprisingly witnessed the mass cancellation of its wine tours and tastings almost overnight at the outbreak of the pandemic.

Gábor Bánfalvi tells the BBJ that the summer is expected to be very slow, although he does see signs of improvement from the fall.

Flexible Friends

“Summer is going to be poor. So far, nothing has really changed [since the outbreak of the virus]; we’ve had some bookings for tastings for small groups of foreign visitors who are in Budapest

Bottles in a traditional Tokaj cellar. Hopes for wine tourism this summer lie with domestic visitors. Photo by Yannick Martinez / Shutterstock.com for the [Euro 2020] football matches,” he said. Looking further ahead, though, Bánfalvi is cautiously optimistic.

“We do have reservations for tours, including a group going to Croatia.

Everyone is using flexible cancellation for their booking with us, and we also request it from hotels. Everyone has to be flexible,” he said.

“There’s definitely demand for the fall; if circumstances don’t get worse, then it could lead to a slow to medium recovery.”

Before the pandemic, Taste Hungary had already diversified from tourism by exporting wines to the United States and European Union member states and has also opened a wine shop opposite the Tasting Table at Bródy Sándor utca.

Roland Mátyási, owner of the Ménesi wine bar at Ménesi út 1, in District XI, is seeing a revival in business.

“We’re bouncing back now following the easing of restrictions at the beginning of June. Having a terrace helps, and it’s usually full, although premium wines are not selling in summer, as guests go for lighter, more aromatic wines,” he tells the BBJ. Having spoken recently to other wine bar owners, he says the consensus is that business is currently at 60%-70% of its usual volume for the time of year.

“We had a few busy days in the last weekend of April, but then visitor numbers fell as people probably came to the realization that it might be risky to go to bars and that they’d better get vaccinated first,” said Mátyási. “Then, the weather was very poor in May, which kept people at home instead of visiting the terrace.”

Like Bánfalvi, Mátyási also mentions that his wine bar has been receiving guests from the Czech Republic, France, and the Netherlands, who have been in Budapest for Euro 2020.

The Polish Factor

An emerging trend in the northeastern region of Eger is that Polish people have been buying holiday homes in the area, attracted by the wine and wellness facilities, explains Csaba Csőrös, head of food and beverage at the Bolyki winery.

“There are those visitors coming to taste the wines on the estate, and those who travel to Budapest and buy wines in wine bars, restaurants or at the airport, and the latter will be extremely limited. I’m quite optimistic that domestic tourism will happen.”

“We’re expecting Polish visitors to return, along with Hungarians,” he said. The winery is located in dramatic surroundings on a former mine site, and has recently added a state-of-the-art new winery building.

Over in Egerszalók, the St. Andrea winery has been busy during the pandemic and has been adding to its guest facilities, building a new tasting center that connects directly to the cellar.

Meanwhile, back in the town of Eger, Tibor Gál is set to build a striking modern new winery opposite his Fúzió wine bar-cum-restaurant on Csíky Sándor utca, which he says will further enhance visitor experiences. He has also sold his “wine box” bar in Eger’s Szépasszonyvölgy. Dropping in on the valley a couple of times recently, a few out-of-towners could be seen sipping wine on the terraces.

Back in Budapest, the 10th edition of the Rosalia festival will take place in Budapest’s City Park from July 2-4.

Only people carrying a card proving protection against COVID-19 are permitted to enter, either issued by the Hungarian authorities or by a country with which Hungary has a bilateral agreement on the mutual acceptance of vaccination cards.

The Rosalia festival hosted some 30,000 guests in 2019. Sixty wineries will be present this year. While the festival is a feast of rosés, exhibitors will also be pouring other wines. A blend of Merlot and Pinot Noir by the Paulus Molnár Borház from the region of Mór, called “Nincs szebb szín a rosénál” (“There is no nicer color than rosé”) was selected by a blind tasting panel as the wine of the festival, winning through a field of 60 rosés.

This wine can be tasted at the stand of the main sponsor, Spar, at the festival and bought from June 24 at Spar and Interspar supermarkets. It has a bright salmon color, and it oozes strawberries and raspberries on the nose and palate. It hits a lovely balance between freshness and fruitiness, but it also has a round, slightly creamy finish that gives it a nice depth and mouthfeel.

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