Cordia, the residential development subsidiary of Budapest-based developer Futureal, is launching eight new residential development projects that will add a total of 1,660 new homes to the Hungarian capital.
The company claims the resi roll-out is the largest by any developer in the last 20 years. In recent years, annual supply has collapsed to just 2,000 units in 2014 while sales are projected to exceed 7,000 units this year.
'The Futureal group has created Cordia with the aim of becoming the largest regional residential developer active in CEE and SEE markets,' said company founder Gabor Futó. 'We see growing regional economies, historically low interest rates and the return of mortgage financing as the catalyst for a new period of healthy market performance. Significant pent-up demand as well as bad quality housing stock in some of the countries create a strong background for our expansion plans.'
Cordia is also developing several residential projects in Krakow and Warsaw. Newly built apartment prices are in general 30% higher in Warsaw than in Budapest, and 10% higher in Krakow than in the Hungarian capital, the company said.
Residential real estate investment has become an attractive option for retail investors compared to stocks and bonds. Average rents have doubled over the last 10 years in Budapest and an average net monthly income for a newly built, one-bedroom flat stands at €650. Cordia's new stock could generate an annual gross rental return of 6-7%, Tibor Földi, CEO of Cordia’s Hungarian subsidiary said.
Futureal Group is one of the leading real estate developers and investors in Central and Eastern Europe and is among the top 20 largest real estate developers in Europe. To date, the Futureal Group has developed over 350,000 m2 of real estate projects with a total value of €900 mln.
