Orbán Cabinet calculates at HUF 1,000/EUR for Rákosrendező’s Grand Budapest project?

János Lázár, Hungary’s Minister for Construction and Transport, recently claimed in a Facebook post that Budapest’s leadership could purchase the Rákosrendező area for HUF 5,000 billion (€12.25 billion). However, the Hungarian government’s contract with the United Arab Emirates regarding the Grand Budapest project includes an agreement to encourage an investment of EUR 5 billion. Moreover, this valuation is based on a highly dubious exchange rate: 1,000 forints per euro.

Orbán cabinet calculates at HUF 1,000/EUR concerning Rákosrendező?

Dávid Vitézy, a mayoral candidate from Prime Minister Viktor Orbán’s Fidesz party and a member of the Budapest Municipal Council, shared the figures on his Facebook page. Vitézy remarked that Lázár’s calculations appeared to assume an exchange rate of HUF 1,000 to the euro.

As previously reported, the leadership of Budapest opposes the Hungarian government’s agreement with the United Arab Emirates regarding the development of the Rákosrendező area. The deal permits the UAE to nominate one or more companies to construct buildings as high as 500 metres in the heart of the city. The Hungarian government has also pledged to implement substantial traffic and infrastructure developments in the area, stipulating that the UAE would pay the purchase price (€122 million for the 850,000-square-metre site near the city centre) only after these improvements are completed.

In return, the UAE is “encouraged” to carry out €5 billion in development on the site. Mayor Gergely Karácsony, however, announced this week that Budapest holds pre-emption rights to the territory and wishes to purchase it for €122 million, the same price the UAE is expected to pay.

The Hungarian government has disputed this claim, arguing that the UAE’s development plans justify a far higher valuation. According to the Orbán administration, Budapest would need to pay at least HUF 5,000 billion (€12.25 billion) to acquire the area—despite the UAE’s contractual obligation being a €5 billion development. For the government’s figures to make sense, the exchange rate would need to plummet to 1,000 forints per euro.

City development or loss of sovereignty?

Experts believe the forint will continue to weaken this year, as the government aims to maintain Hungary’s competitiveness. However, they predict an exchange rate of around 420 HUF/EUR. R. A rate of 500 HUF/EUR would be shocking for Hungarian society, let alone 1,000.

The Hungarian government contends that the Rákosrendező project represents a unique opportunity to attract capital to revitalise the derelict area. Officials argue that Budapest’s leadership has been incapable of improving the site, with piles of rubbish left untouched for years. From the government’s perspective, the UAE investment ensures renewal and progress.

On the other hand, opposition politicians, including Budapest’s leadership, accuse the Orbán government of sacrificing national sovereignty. They argue that the agreement hands a prime piece of Hungary’s capital to foreign investors, allowing luxury developments such as high-end apartments, office buildings, or even a “Trump Tower” (a controversial proposal previously reported HERE). The opposition insists that the land should be used to address Budapest’s urgent housing crisis rather than catering to speculative developments.

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A 500-metre-high skyscraper near downtown?

One of the most contentious aspects of the project is the possibility of constructing a 500-metre-high skyscraper near Budapest’s city centre. Dávid Vitézy highlighted this provision, noting that the government’s contract with the UAE explicitly permits such construction. Critics argue that such a structure would irrevocably alter the skyline of Budapest, which is currently dominated by historic architecture. Even János Lázár has voiced reservations about the proposal.

Although the government technically retains veto power over the UAE’s plans, the contract obliges it to remove all legal or bureaucratic obstacles to the development. Should these obstacles not be resolved, the UAE is not required to pay the purchase price.

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Featured image: depositphotos.com