Istvan Tiborcz, the son-in-law of Hungarian Prime Minister Viktor Orban, who leads the BDPST group, has purchased 11 business buildings in Novi Beograd. Although the transaction value has not been disclosed, judging by the financial results these properties bring, the return on investment may not be challenging or prolonged.
The company Diofra Fund Management, the buyer of these buildings, is part of Tiborcz’s BDPST group, and it has added five business parks to its portfolio, where these 11 buildings offering office space for rent are located.
The largest park is Green Heart in Milutina Milanković Boulevard, comprising five buildings with a total gross area of 46,000 square meters. These structures have four to seven floors (plus ground floor), and one of the most well-known tenants in one of the buildings is the company Nordeus.
Down the street, or in the vicinity, is the FortyOne business park, consisting of three buildings with a total area of 28,000 square meters (six floors and a ground floor).
At the end of the same boulevard, at the corner of Vladimir Popović Street, there is the 19 Avenue building (housing the EU Delegation in Serbia) with 17,000 square meters (formally consisting of two buildings, each with nine floors).
The fourth park consists of the Belgrade Business Center building next to the Belvil settlement. It houses the headquarters of the company Air Serbia and has 11 floors and 17,000 square meters.
Finally, there is the well-known GTC building, now House, in Bulevar Zorana Đinđića, diagonally across from the Belgrade Arena. The facility covers 13,500 square meters, spanning six floors and a ground floor.
Revenues and profit
Each of these business parks is managed by a separate company. When looking at their business performance in 2022, for which the latest financial reports are available, it can be seen that Orban’s son-in-law is acquiring profitable businesses.
In that year, these five companies together generated more than 35 million euros in revenue and achieved a net profit exceeding 12.5 million euros. This represents a net profit margin of around 35%, which would certainly please any investor.
More than a third of the revenue was generated by the company Atlas Centar, which manages the Green Heart park in Bulevar Milutina Milankovića, likely influenced by the large rental area. In 2022, this company achieved total revenues of 13.4 million euros and a net profit of around 6.8 million euros.
In second place is the company Demo Invest, which oversees the FortyOne complex with 28,000 square meters. It generated revenues of 8.3 million euros and earned about 3.9 million.
The third is the company Business Center, managing the BBC building near Belville. It earned a total revenue of 6.6 million euros in 2022 and recorded a net profit of 3.4 million euros.
The fourth in reported revenues is the company Business Point NBG 64a, which manages the building near the Arena. Total revenues amounted to around 3.5 million euros, with a profit of 1.47 million.
Finally, the company Business Park 19 Avenue is the last in terms of revenues, with an achieved 3.4 million euros, and it is the only one that recorded a loss in 2022 – 2.99 million euros.
On a good path to recovery after the pandemic
Given the fate experienced by the office space rental industry during 2020 and 2021 due to the COVID-19 pandemic and the shift of companies towards hybrid or remote work, it can be noted that companies managing these properties are on a good path of growth.
The highest creditworthiness could be attributed to the company managing the building near the Arena, but others are not far behind, and in terms of risk, all are in the upper half of the spectrum, meaning they do not pose a risk to the owner. Also, what is common to most is good solvency and a decreasing trend in indebtedness.
The only company that had a challenging 2022 was the one managing the 19 avenue building due to the incurred loss that reflected on other indicators, but it shouldn’t be a problem for the new owner.
Interestingly, none of the five companies have employees.
It’s worth noting that all companies changed their financial reports during the past year (one was initially reported as inaccurate). If data from these reports were considered, the reported value of the sold properties amounts to around 275 million euros. When GTC sold these buildings to the Indotek group in 2021, media reported that the proposed price was 267.6 million euros, which was above their book value.
Registered changes in management and co-ownership
The Business Registers Agency yesterday announced changes in the management of all five companies. Instead of Daniel Jelinek, who served as the director of all five companies, he was replaced by Mirko Smiljanic and Hungarian citizen Marton-Kalmar Nad.
Jelinek is the owner of the Indotek Group, from which the Diofa Fund bought 11 business buildings. He is one of the wealthiest businessmen in Hungary, and local media have extensively reported that he is a long-time business partner of Istvan Tiborc. It should be noted that Tiborc also bought the Diofa Fund from Jelinek.
About ten days before the end of last year, changes in the ownership structure were recorded in the Business Registers Agency. Up to that point, Hungarian companies Office Planet Ingatlanfejleszto Korlatolt Felelossegu Tarsasag (70%) and Westavis Ingatlanforgalmazo es Szolgaltató Korlatolt Felelossegu Tarsasag (30%) held shares in all five companies. According to available data from Hungarian business portals, Jelinek represented both companies.
At the end of last year, it was recorded in the Business Registers Agency that 30% of Westavis’s stake is transferred to the company Gordiusz West Holding Korlatolt Felelossegu Tarsasag, represented by Tamas Bodnar, who is one of the managers at Diofa. There is no evidence of any changes regarding the stake held by Office Planet as of now.
Sign up for business updates & specials
