Thus, the construction sites froze the epidemic

Last year, due to the epidemic, construction work started 15 percent less than in the previous year, compared to 2018, after the value of the Construction Activity Start-up indicator was only less than HUF 2,000 billion (1990 billion). The decline affected all major sub-sectors, according to the EBA Construction Activity Report.

Although the year 2020 started quite strongly a high-rise buildings In the second quarter, momentum has declined since the second quarter
The amount of high-rise construction started in 2013 amounted to HUF 1,353 billion, a decrease of 10 per cent compared to 2019 and 17 per cent compared to 2018, which is mainly due to the significant fall in the number of condominium construction.

The total value of condominium projects entering the construction phase in the first quarter of the year even exceeded the numbers of the same period of the previous year, but the collapse in the following 9 months was so large that the value of projects actually started in 2020 was 2015-2016. it fell to the level of the first few years, showing a decrease of almost 40 percent compared to 2019.

In the case of non-residential high-rise buildings, there was little difference in Activity Start in 2020 compared to the previous year.

The biggest projects launched in the last quarter of the year include the construction of the Hotel Hévíz, the restoration and development of the Budapest Citadel, and the construction of several rural industrial and factory buildings, such as Nestlé Purina’s pet food factory in Bük or ZalaZone’s military plant in Zalaegerszeg.

Huge fall in civil engineering

The civil engineering sector had a booming year in 2020, while the first months got off to a good start and the fourth did well, with the middle half of the year significantly below the 2019 figures. The Activity-Starting ratio was £ 636 billion, almost 40 per cent lower than the 2017-2019 average. Compared to the 2010-2016 average, this value is still 25 percent higher, so 2017-2019 can still be considered outstanding.

In the civil engineering sector, the total value of start-up construction projects in the road and rail sector decreased by 32 percent compared to 2019 compared to outstanding years. For non-road and rail construction, the Activity Start indicator indicates a 15 percent decline.

Among the highest value civil engineering projects launched at the end of 2020 are, for example, the start of construction of the Budapest Athletics Stadium and the ZalaZone automotive test track in Zalaegerszeg.

Central Hungary increased its national share

In terms of all the constructions started, Central Hungary and the Western regions closed in 2020 at almost the same Activity-Start value as in 2019, and even the indicator increased minimally. In the eastern regions, however, the total value of projects entering the construction phase fell sharply, by 41 percent, with the decline occurring most in the second half of the year.

Thus, among the regions, Central Hungary and the western regions also increased their share of the amount of construction started, while the share of the eastern regions decreased to 25 percent according to the EBA Construction Activity Report.

Housing market

The economic crisis caused by the coronavirus and the VAT rate, which has been rising again to 27 percent since the beginning of the year, have resulted in a remarkably low Start of Activity in the condominium housing market. The last half of the year produced such reduced numbers that we cannot find a similar one looking back until 2014-2015. However, the 5 percent VAT rate brought back from 2021 could stop the deep flight and generate growth in the sector, so the market could return to much higher Activity-Start numbers this year, the report says.

A completely different picture emerges when examining the Activity-Completion indicators, as the total value of completed projects was at a record high of HUF 424 billion in 2020. This is 40 percent higher than the previous peak in 2019 and doubled compared to 2018. Preliminary data for 2021 are expected to have a similarly high value of completed projects.

The nationwide 40 per cent decline in the Start-up of Activity in the housing sector affected the country’s regions unequally. In Budapest, the amount of projects started in 2020 decreased by only 9 percent compared to 2019, however, in all other regions the decline was more than 40 percent, and in Pest county it was 85 percent.

Due to these tendencies, the regional proportions have also changed, due to the importance of Budapest, more than two thirds of the value of the started condominium constructions was concentrated in Central Hungary. And the western and eastern regions remained well below their multi-year average.

Growing hotel construction, stagnant capital

Last year also exceeded the record high value of 2019, in 2020 hotel construction in the country started in the amount of HUF 91 billion, which was a 6 percent increase compared to the previous year. The last quarter was outstanding, with an activity start of HUF 36 billion in the period
registered. In 2020, the two pull regions were Northern Hungary and the Lake Balaton area.

At the end of last year, the construction of the Hotel Hévíz 5 * and the Hampton by Hilton hotels in Budapest started. Earlier this year, the construction of the Minaro Hotel Tokaj, the Green Resort Balatonfüred and the BalaLand Hotel in Szántód began.

In 2020, the amount of completed hotel constructions also continued to grow, with a total of HUF 48 billion worth of hotels handed over, which represented a 33% increase. In the regional distribution, the capital accounted for more weight in the total value of completed projects than in the case of those started, accounting for almost two-thirds. And this year, growth will not stop and hotels are expected to be handed over at even higher value.

For example, the Botaniq Turai Castle and the Kozmo Hotel in Budapest have been handed over, and the works are expected to be completed in the first half of this year in Budapest for the Matild Palace, InterCity Hotel and B&B Hotel, while in the countryside for the Mária Valéria Hotel in Esztergom, Erzsébet camps in Fonyódliget and the youth sports accommodation in Felcsút can be completed.

This is how investment in education stands

In 2020, construction work on educational buildings began at an outstanding value. Although the peak of HUF 140 billion in 2018 was not reached and fell short of the value of 2019 by a few percent last year, it is the third most successful year with a project started with HUF 120 billion, far exceeding the average of HUF 44 billion in 2000-2016. .

In 2020, for example, the construction of the EMC Measurement Lab server center in Budapest worth HUF 16 billion, the Semmelweis University Faculty of Health Sciences, Department of Traditional Chinese Medicine and St. Angela Franciscan Primary School and Gymnasium, and the University of Debrecen Innovation Center and Learning Center. The renovation and expansion of the Szeged Health Sciences Training Block can start at the beginning of the year.

Construction investments in education amounted to HUF 102 billion in Hungary in 2020, and the outstanding trend of recent years can also be felt in handovers. For example, the construction of the partly R&D center Univerzum Office Building in Budapest, the renovation of the campus of the Faculty of General Medicine of the University of Pécs and the reconstruction of the Ludovika Wing Building, as well as the construction of the Rózsakerti Demjén István Reformed High School have also been completed.

In the short term, they can complete even more projects, several of them in Pest County. In Érd, the renovation of the Batthyány Sports School and Primary School, as well as the Károly Kós Vocational High School and Vocational High School of the Vocational Training Center, as well as the construction of the Fenyves-Parkváros Public Education Center,
A primary school is planned in Biatorbágy.

The EBI Construction Activity Report was prepared by ELTINGA, iBuild and Buildecon.

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