Corruption? Orbán’s son-in-law involved in government investments worth billions

The Hungarian government is set to acquire three properties for a total sum of at least HUF 580 billion (nearly EUR 1.5 billion) through non-public agreements. Each of these investments is connected to businessmen with close ties to the government, including Viktor Orbán’s son-in-law.

Válasz Online identified and summarised three major investments where the Hungarian state has agreed to pay at least HUF 580 billion (EUR 1.49 billion) to groups owned by businessmen allied with Fidesz. This includes the Főnix Private Equity Fund, which is linked to Prime Minister Orbán’s son-in-law.

The newly acquired properties include the office blocks in the city centre of Zugló, Dürer Park, and the buildings on the Kopaszi Dam, covering a total of 350,000 square metres.

Dürer Park – Orbán’s son-in-law directly involved

The acquisition of the Dürer Park office buildings, located next to the City Park, has been in progress since 2022. The Hungarian National Asset Management Company concluded a preliminary agreement with Dürer Investment Ltd. without any public oversight. The plan is to house the Ministry of National Economy, the Hungarian Development Bank and several other state-owned companies in these offices.

As per 24.hu, the total price of the Park could be HUF 120 billion (EUR 309 million), likely to increase from the original HUF 110 billion (EUR 283 million) due to inflation. While the final sum is still pending government approval, the cost will be approximately HUF 2 million (EUR 5,162) per square metre, akin to luxury apartments in Budapest. Regardless of the final cost, reports indicate that the Hungarian state has already transferred HUF 80 billion (EUR 206 million) to investors as an advance payment.

The Dürer Park deal involves Market Asset Management Ltd., owned by government ally István Garancsi and the Főnix Private Equity Fund, linked to István Tiborcz, Viktor Orbán’s son-in-law.

The Zugló City Centre – Márton Nagy enters the picture

In the spring of 2023, the Hungarian state signed a preliminary agreement to transform the Zugló City Centre in Bosnyák Square into a government quarter. The state will purchase 150,000 square metres of office space for HUF 244 billion (EUR 629 million).

The relevant contract was made public by MP Ákos Hadházy, in collaboration with Transparency International, in early May 2024. Telex quoted Hadházy who said, “[the contract] gives an amazing insight into the system, for example, that the 244 billion contract was signed without any prior evaluations, that there were no plans ready at the time of signing, and that the contract says that the final plans will have to be agreed upon.”

The absence of final plans for the construction did not prove to be an obstacle to the project: just five days after the agreement, the state transferred the 10% + VAT deposit to the contractors. “The company probably really needed the cash,” Hadházy remarked. Even if the state disapproves of the plans, the deposit remains with the contractor.

Bayer Construct Zrt., managed by Attila Balázs, a business associate of István Tiborcz, is the contractor for the Bosnyák Square project.

Adding to the complexity, the lawyer who countersigned the contract, Judit Pete, is closely linked to the Minister of National Economy, Márton Nagy, and his brother. She took over the law firm of Márton Nagy’s brother on the day of his appointment as minister. This firm has signed contracts worth hundreds of millions with state-owned companies now under Nagy’s supervision. Shortly after taking office, Nagy appointed Judit Pete to the Public Procurement Council.

The future inhabitants of the Zugló properties include the National Tax and Customs Office, the Directorate General for Public Procurement and Supply (KEF), and the Pest County Government Office, despite a recent seven billion HUF complex for KEF completed in 2018.

Kopaszi Dam – Orbán’s son-in-law reappears alongside several other names close to the NER

The largest investment involves the office buildings on the Kopaszi Dam in Újbuda. In the summer of 2023, the state signed a preliminary contract to purchase 160,000 square metres of office space for HUF 255 billion (EUR 658 million).

The so-called BudaPart project, launched in 2016, is a priority government investment, meaning the municipality has no say in its completion. One of the first elements of the project was the construction of the Mol Tower.

As part of this state investment, the government signed a contract with the developer prior to completion, ensuring that the yet-to-be-built properties would meet the needs of the public offices that will occupy them. The BudaPart properties will likely house the MÁV-Volánbusz Group, the State Customs Court, the National Election Office and the National Intellectual Property Office, among others.

At the same time, this measure, as Telex pointed out, “is a great help to Kopaszi Dam Plc., as they can build with the certainty that there will be tenants in their office buildings.” However, Válasz Online reports that the six office complexes under construction will not be rented by the state but bought by it.

The four owners behind the developer, Kopaszi Dam Plc, include Viktor Orbán’s son-in-law, István Garancsi, Sándor Scheer (also close to the government) and Zsolt Hernádi (CEO of the Mol Group).

The total area covered by these three contracts is double the size of the government quarter proposed by the Gyurcsány government, which Fidesz harshly criticised at the time. In fact, as Válasz Online writes:

“The M4 metro line was completed ten years ago at a cost of HUF 452 billion (EUR 1.1 billion), and according to the European Anti-Fraud Office, there was plenty of suspected corruption in that project. Under cleaner conditions, HUF 580 billion today could be enough for, for instance, the development of a whole metro line or to renovate the Chain Bridge more than twenty times.”

Read also:

• Bank business owned by Orbán’s son-in-law is flourishing
• New list of wealthiest Hungarians: Lőrinc Mészáros gained half of his wealth in a year

Source: Válasz Online, Telex, 24.hu