The Eiffel Palace office building in Budapest | source: Horizon Development

Budapest's Eiffel Palace sold again

August 8, 2017

The National Bank of Hungary (MNB) has sold heritage protected Eiffel Palace, a downtown office building in the vicinity of the Nyugati railway station in the Hungarian capital, to the Luxembourg-based Corpus Sireo Real Estate investment fund for EUR 53.8 million.

Eiffel Palace – originally constructed in 1893 – was sold twice within the last three years, both times at the best yield in the Hungarian property market. MNB purchased the building directly from the developer (Horizon Development) three years ago in August 2014 at a price of EUR 45.3 million, with an approximate yield of 6.5%, and resold it in August 2017 to Luxembourg-based Corpus Sireo Real Estate investment fund for EUR 53.8 million, at a yield around 5%, generating an almost 20% profit on the deal.

According to a statement by Horizon Development, as a result of its well-thought-out architectural concept and business model, the authentically restored and technologically perfected, elegant 125-year-old office building with a continuously enhancing value claimed its spot on the international investment map.

The former headquarters of Hungarian daily paper ‘Pesti Hírlap’ and Légrády (later Zrínyi) Printshop proved to be the best in Central and Eastern Europe, and even globally, in the categories of heritage restoration, sustainability, real estate development, architecture and general construction, collecting 18 awards in total between 2013 and 2015.

The office building was 100% leased to prestigious local and international companies with long-term contracts soon after its 2014 handover, a fact that contributed to its first divestment within the same year as a highly profitable, valuable investment product. After the second divestment transaction announced last week, it is safe to conclude that Eiffel Palace generated the highest possible yields of all times among Hungarian office buildings, the statement says.


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