Retiring President János Áder receives a state-owned villa rebuilt for HUF 929 million

A year ago, Átlátszó learned that the 2,141-square-metre state property at 3/a Béla király út in the XIIth district of Budapest was being rebuilt for János Áder, who served as President of Hungary,and who will be suceeded by Katalin Novák on 10 May. In the summer of 2021, we obtained the building permit for the project, which revealed the parameters of the villa and also that the property is part of the Normafa Park historic sports area, and the investment in it is a priority project from a national economic point of view. In its reply to Átlátszó’s FOI request, the Directorate-General for Public Procurement and Supply indicated the cost of the construction at HUF 929.1 million.

A public data request has been made to the contractor, the Directorate-General for Public Procurement and Supply (KEF), to find out the cost of the project. We have now received the data, 6 months after the request.

Last summer, Blikk published an article on the future pension of German Chancellor Angela Merkel, which also covered the benefits of the Hungarian President, who will step down in May 2022. The article revealed that János Áder, as former president of Hungary, receives a cash allowance equivalent to the current presidential salary (around HUF 3.5 million gross), and a pension for his work as a former MEP. The latter is expected to amount to 430,000 HUF, which will be paid on top of his former MEP’s salary of 8900 EUR per month (around 3.2 million HUF), which he received for four years.

The paper also reported that the president is entitled by law to the use of a state-owned and maintained apartment, a staff of one person, the use of a personal car with a driver, a secretarial office with a maximum of three people and a car. The article also referred to the President’s asset declaration at the time, and said that János Áder might not use the right to use the apartment granted to him by law.

Contrary to Blikk’s assumption at the time, Átlátszó learned in the summer of 2021 that the 2,141-square-metre state property at 3/a Béla király út in District XII would be rebuilt for the former president.

Sauna, fitness room and a roof garden

Átlátszó has also obtained the building permit issued by the Government Office of Budapest on 9 February 2021. It revealed that the villa will include a sauna, a fitness room, a laundry room, a carport with two parking spaces, a passenger lift, a terrace and a roof garden.

The document also states that the net floor area of the building, which will be built on a plot of 2141 square metres, will be 637 square metres after the complete renovation and refurbishment, with the addition of 178 square metres of terrace and roof garden.

The official document also disclosed that the construction work for the property is “a matter of national economic priority linked to the investments necessary for the realisation of the Normafa Park Historic Sports Area”. Since the project in question is not in fact related to the subject matter indicated, it can be concluded that the Government intended to exempt the project from local building regulations and to facilitate and speed up the preparation and execution of the construction work.

The Government Decree also sets specific building regulations for properties in the historic environment: it sets a higher limit for the building density (15% instead of 20%) and a lower limit for the mandatory minimum green area (65% instead of 60%) compared to the local building regulations.

When was the location chosen?

The 2013 government decree regulating the Normafa Park historic sports area was amended by a government decree published on 30 December 2020 and entering into force on New Year’s Eve, which also dedicated a specific paragraph to the property in question. This means that the investment became a priority issue for the national economy. The date of the government decree therefore indicates that preparations for the use of the property had already begun by the end of 2020, and the fact that the investment was made a priority, the specific features of the renovation and the scale of the investment indicate that the works were carried out in response to a specific need, i.e. the future occupant of the building.

In this respect, although the reply from the KEH in 2021 – that the Head of State had not yet decided on the formal application for the right to use the building – was correct, the purpose of the building’s use was in fact already decided at the end of 2020.

How much did the investment cost?

In October 2021, Átlátszó submitted a public interest data request to the Directorate General for Public Procurement and Supply (KEH), to find out more about the public procurement procedure and contract under which the renovation was ordered, and at what cost. However, due to the emergency caused by the coronavirus pandemic, KEF had 45 + 45 days, i.e. 90 days, to respond. Despite our explicit request, the reply received in January 2022 did not specify the cost of the investment under consideration, but only provided the availability of the framework contract and its amendments. This led to another public data request, to which they also had 90 days to respond.

In the meantime, we asked an industry expert to estimate the value of the investment. The expert estimated the construction costs at around HUF 1 billion, based on the technical content of the document issued by the Budapest City Government Office and the photos we showed him.

However, the amount given did not include the cost of the internal finishing (e.g. cladding, furnishing), nor did it include the cost of the security system that would probably be installed. These latter items, given the size of the property, could significantly increase the total cost of the investment, which could reach HUF 1.5 billion.

From the reply sent by KEF on 28 April, we currently know that “…the Directorate-General for Public Procurement and Supply is carrying out a conservation and value-enhancing investment on the property under its management for a total amount of HUF 929 116 725.” However, the documents requested in the request for information (quotation, order) were not attached, so it is not clear what the price sent relates to and whether it covers the total amount of the investment.

Procurement champion general contractor

The main contractor of the construction is B+N Referencia Zrt. The company’s biggest “catch” so far was a 3+1 year, HUF 300 billion hospital cleaning contract, which it won in early 2021. The success in public procurement is also reflected in the Opten company database, which show that the company has made steady progress between 2016 and 2020, with annual net sales increasing from HUF 13.7 billion to HUF 67.3 billion and profit before tax from HUF 1.5 billion to HUF 6.3 billion.

As it emerged from the incomplete public data request, the renovation project in question is part of a public procurement originally awarded by B+N Reference Zrt. in November 2020 for a total of HUF 100 billion for the maintenance, renovation, repair and operation of state-owned properties.

The property on Béla Király Road, is part of the Western Hungary supply area of the Directorate-General for Public Procurement and Supply (KEF). The project is therefore one of the elements of the public procurement section which originally included 135 properties at the time of the contract award. B+N Referencia Zrt. was contracted to carry out the works on 223,000 square metres of net area for around HUF 35 billion, but in 2021, the contract was amended and the budget was increased to HUF 52.5 billion.

State properties received by former presidents of the republic

Árpád Göncz, the first President of the Republic after the change of regime, stepped down in 2000, and was given the Kocsis Villa on Vérhalom Square in Buda. The 590-square-metre villa on a 2,873-square-metre plot of land, managed by the Ministry of the Interior, was renovated 22 years ago for HUF 129 million.

Ferenc Mádl left office in 2005, after his first term. At that time, 17 years ago, the KEH bought a 160-square-metre apartment, a garage and a storage room for the former president for HUF 126 million.

For László Sólyom, who also served one presidential term, KEH bought an apartment in a semi-detached house on a plot of land of 2018 square metres near Normafa. The 265 square metre, 5-room house with an internal lift included a 75 square metre garage and a 55 square metre terrace. The National Assembly allocated a budget of HUF 340 million for the purchase and renovation of the apartment, of which the KEH used HUF 195 million in 2010, 12 years ago.

President Pál Schmitt did not complete his five-year presidential mandate, he was forced to resign after 2 years in 2012 due to a plagiarism case. Despite this, he applied for the right to use his apartment, but before a suitable property could be found, he decided to turn down the opportunity, citing the country’s poor economic situation.

President János Áder will step down at the end of his second term, in May 2022. The president will move into a 637-square-metre villa in Buda on a state-owned plot of land of 2141 square metres, which will be completely rebuilt before his arrival. The cost of the construction was HUF 929.1 million.

Translated by Zita Szopkó. The original, Hungarian version of this story was written by Kornél Brassai and can be found here. Photographs by Kornél Brassai, camera drone video by the Hungarian Two Tailed Dog Party.

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