Hungarian SMEs at crossroads: Inflation, growth barriers, and a new era of industrial real estate
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Leading representatives of the domestic real estate market gathered for the second time on May 15th, 2025, at the exclusive HAD Real Estate Business Brunch organized by RaktárAD, a Belgian-Hungarian-owned company, within the framework of the Industry Days exhibition, where the company group also won the award for the most beautiful stand this year.
The event focused on the inflation challenges of the domestic SME sector, investment opportunities, facility location selection considerations, and growth-enabling financing structures, which together determine the development trajectory of businesses.
The presence of top-tier invited experts elevated the event’s prestige: Milla Kalmár, head of the industrial real estate division at 108 Real Estate Hungary, Mariann Micskei, chief operating officer of Goodwill Energy Ltd., János Kovács, vice president of the real estate department of the Budapest Chamber of Commerce and Industry (BKIK), Dávid Heim, franchise partner & commercial real estate expert of Otthon Centrum and Tibor Lőrincz-Hadnagy, partner and business development manager of HAD Group, shared current market trends and practical experiences with the participants.
The prestigious professional event was opened by Ernő Hadnagy, president of HAD Group, who announced in his speech that RaktárAD, reflecting on the growth demands of businesses and the most sought-after locations in the region, is implementing a targeted expansion strategy that, in addition to existing developments in Alsónémedi and Vecsés, will launch new industrial projects in Nagytarcsa and Bag. Furthermore, it is initiating a strategic opening towards the northern and western agglomeration of Budapest – especially Dunakeszi and Budaörs – offering modern and competitive warehouse solutions.
Survival or development? The situation of domestic SMEs in economic turbulence
Over the past ten years, the Hungarian economy has suffered nearly 80% inflation, well above the EU average of 30-35%. This has particularly affected small and medium-sized enterprises (SMEs), where significant productivity disparities have emerged. While the real-term performance of sole-proprietor micro-enterprises stagnated, the productivity of companies with 2-9 employees outpaced inflation by 60-70%, and medium-sized companies saw a productivity increase of 40% above inflation.
Although the number of businesses has increased by 50% in 10 years, the expansion is primarily due to one-person and so-called “zero-person” project companies. The number of small and medium-sized enterprises has essentially remained unchanged.
The SME sector accounts for 65% of the workforce, but in an inflationary environment, most of their resources are consumed by wage costs, leaving little for development. Companies that have strengthened their operations with conscious investments have now become more competitive, more capital-rich players, and appear more actively, for example, in the industrial real estate market.
Financing challenges and lack of competences hinder the development of micro and small enterprises
Although the domestic banking system is currently operating in a state of abundant liquidity, lending activity is still subdued, as financial institutions can typically only serve creditworthy clients. “The vast majority of micro and small enterprises – especially sole proprietorships – typically do not meet these conditions, and are therefore excluded from effective financing. The number of domestic small enterprises is exceptionally high in comparison with the EU. Within this, the proportion of micro enterprises is also high, yet this segment lags behind the most in terms of development opportunities.
The reason for this is that such companies are often not established out of business considerations, but out of necessity to make a living. The disproportion in support systems further deepens the gap between multinational companies and domestic SMEs. In recent years, industry giants – especially players in the battery and automotive industries – have received significant state subsidies, while smaller enterprises are often excluded from these opportunities. In the interests of competitiveness of domestic companies, a reevaluation of the current support structure would be reasonable.” – explained János Kovács, vice president of the real estate department of the Budapest Chamber of Commerce and Industry (BKIK).
Barriers of growth and the way out: competence development and cooperation to strengthen micro-enterprises
Most businesses lack a strategic approach tailored to the company, portfolio management adjusted to the projects, a digital presence – in many cases they don’t even have a website – and limited external market connections. A lack of competence, a lack of financial resources, as well as infrastructure and motivation deficits all hinder their growth.
Addressing these issues, the Sándor Demján Program was launched at the initiated by the National Association of Entrepreneurs and Employers (VOSZ), which offers targeted support to foster the development of small businesses. The program’s goal is not just to provide funding, but to map, develop and strengthen long-term cooperation opportunities, such as clusters and consortiums.
Investment restraint and real estate market hesitancy amid the uncertain economic environment
Economic uncertainty – especially inflationary pressures, international trade tensions and uneven state support –strongly obstructs the willingness to invest among both multinational companies and domestic SMEs. Large companies are postponing major property changes, and for SMEs, the unpredictability of the market environment makes developments risky. “While many SME leaders prefer to save, larger companies are increasingly using alternative forms of financing, such as installment payments or PPA (Power Purchase Agreement, electricity purchase agreement) constructions, in order to ensure the sustainability and cost-effectiveness of their operation.” – emphasized Mariann Micskei, chief operating officer of Goodwill Energy Ltd.
The number of new contracts in the rental market is decreasing nationwide. It is becoming more common to extend existing leases – even if the property is technically outdated and operating costs could be reduced by improving energy efficiency. For companies, moving to a new location poses not only a financial burden but also a workforce retention risk, so maintaining stability has become a top priority.
RaktárAD is a committed partner of SMEs
The SME sector is the driving force of the Hungarian economy. RaktárAD has not only recognized this, but has also made it its mission to support domestic family businesses. It believes that we don’t have to wait for miracles to happen, but we have to band together for development.