A foundation created during Viktor Orbán's government has purchased dozens of historical buildings in the Carpathian Basin, including 26 in Romania. Many of these have been left to decay. The new Executive in Budapest has cut the program's funding.
A large-scale real estate acquisition program run by Hungary during Viktor Orban's mandate in recent years leaves behind dozens of historical buildings, many of them degraded and without a clear restoration plan. No fewer than 26 properties are located in Romania.
The Foundation for the Conservation of Built Heritage in Central Europe (KEOMA), established in 2021 and used to purchase properties throughout the Carpathian Basin, is set to be dissolved at the end of August.
The decision is part of a broader process through which the new government in Budapest is dissolving public interest asset management foundations that do not administer universities.
However, the remaining problem is a costly one: what will happen to the real estate heritage accumulated in recent years, for the purchase of which tens of billions of forints were spent?
Many of the buildings require major investments for restoration, and at this moment, there is no clear concept regarding their future nor the funding necessary for the works, according to information published by the Hungarian portal HVG and cited by the newspaper Népszava.
Tens of billions of forints spent on buying buildings, but renovations have been delayed
KEOMA was created with the declared objective of contributing to the conservation of the built heritage in Central Europe. In practice, the foundation rapidly accumulated a huge real estate portfolio spread across several states in the region.
Zoltán Tarr, the Hungarian Minister of Culture and Social Relations, explained to HVG that legislation regarding the reorganization of public interest asset management foundations initially assigned KEOMA to the ministry he leads.
However, the foundation was subsequently transferred to the Ministry of Transport and Investment, the reason being that it was not actually conducting cultural activities, but had primarily accumulated considerable real estate heritage.
The Ministry of Culture drew attention, through a note, to the necessity of conserving and developing important buildings to protect the heritage. These properties, however, represent only about a quarter of the entire portfolio.
One of the major problems with the program was the pace of acquisitions. According to HVG, the properties were purchased for tens of billions of forints, but returning them to an appropriate state would require additional investments of at least the same magnitude.
The acquisitions were made so rapidly that the financial resources and the time required for renovation and finding uses for the buildings could not keep pace with the expansion of the portfolio.
The result is that, after several years, numerous properties are still in the preparation or design phases, without the actual works having begun.
Romania holds 26 of the properties. Only one building has been renovated in five years
An official list obtained by HVG and compiled about two years ago indicates the existence of approximately 41 buildings acquired through this program outside of Hungary.
The majority are in Romania: 26 properties. Another 11 are in Slovakia, two in Croatia, one in Slovenia, and one in Serbia.
The status of the works shows how little the project has progressed after the wave of acquisitions.
In the case of the Neoclassical building on Nyerges Street in Bratislava, which hosted the Hungarian embassy until 2018, and the former Hotel Pannónia in Trenčianske Teplice, projects had reached the stage where execution could be put out to tender.
For the other properties, procedures had not even reached this point, with them appearing in various stages of "preparation" or "design."
According to HVG, in approximately five years, only one property in the portfolio has been renovated and handed over: Hotel Pannónia in Satu Mare, one of the first buildings purchased under the program.
The dissolution of KEOMA now leaves the new government in Budapest facing a difficult decision. Buildings do not disappear along with the foundation, and some of them require substantial investment to prevent continued degradation.
In the absence of a new source of funding and a plan for each property, the costs required for restoration could become a major problem for the administration taking over the heritage accumulated in previous years.
KEOMA was led by Levente Magyar, former Secretary of State in the Hungarian Ministry of Foreign Affairs and former deputy to Foreign Minister Péter Szijjártó.