“The pandemic has overwritten any expectations we had at the end of 2019,” says Schoenherr Budapest Partner Gergely Szaloki. “We were very optimistic, and the market was booming, but the pandemic changed many things.” He underlines the frequent switch to a home-office working environment as being a particular source of change for the real estate market. “Not only the office spaces,” he says, “but I can imagine that flats will also be designed in a way so that it’s possible to establish at least a working corner at home.”
Szaloki says that the past few months have seen the creation of a number of pandemic-related laws affecting Hungary's economy. “Without trying to be exhaustive, it is worth mentioning the extension of the payment moratorium as well as the introduction of the eviction moratorium until the end of the pandemic situation,” he says. “Also, the Hungarian Parliament introduced a special reorganization procedure related to the Covid measures, and the implementation of the restructuring directive is expected to be adopted any time.”
In the meantime, Szaloki notes that not all markets have suffered equally during the pandemic. “The bond market is growing; the bond program of the Hungarian National Bank is running,” he says. “Sustainable energy is also a hot topic; solar farms are in development throughout the country and the pandemic did not really affect these projects.”
Szaloki reports a good outlook for deals in general, in fact. “Certain bigger M&A transactions are expected in the banking sector as well. Generally, while we saw some caution at the beginning of the pandemic, by now things are getting back to normal when it comes to deals.” He notes, though, that the inflation rate is expected to be higher than forecast, and that the Hungarian National Bank, “after many years, is considering increasing the base interest rate.”
Finally, Szaloki says that there hasn’t been any major news of note in the Hungarian legal market over the past year. “I think these days lawyers are rather conservative and are not moving unless necessary. So far, I have not heard about any effect of Covid on the players of the legal market: no big movements happened like 12 years ago.” As to the legal business, certain sectors started thriving, for example real estate and labor law issues popped up from the ground that we could not even imagine existing before.”
