It's the Same, but Totally Different: An Inside Job in Budapest

http://www.nytimes.com/2013/03/29/greathomesanddestinations/29iht-rebuda29.html

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BUDAPEST — Elizabethtown, a neighborhood at the very heart of the Hungarian capital, is a tangle of narrow streets and low-rise buildings, blackened by age.

In recent years, the Dohany Street Synagogue, the largest in Europe, has had its black and gold domes and Moorish-inspired facade renovated. And the area, which includes the former Jewish Quarter, has become a hip meeting point for youth from all over Europe — well-known for its unpretentious restaurants, designer boutiques and “romkocsma,” literally translated as “ruin pubs,” in some of the rundown buildings.

While it might be difficult to convince investors that residential property here is a good bargain, the best example of the area’s potential could well be the Tivadar Mika house.

Georgette Avruch bought the property from the city in 1996, intending to demolish it and build new housing units. But before work could begin, the national office for historic monuments announced that the house should be preserved.

The three-story building, known by the name of its original owner, was built in 1909. It initially served as a home for Mr. Mika, his family and workers, and it also contained a small factory space for the copper tools, ornaments and other items that they made. Under Communism, the family was evicted in 1954 and the house was divided into small apartments. Eventually, it was abandoned.

Once demolition was ruled out, “we had to rethink the whole concept,” Ms. Avruch said.

Eventually, she said, “we completely restored this building except the back part, where we modernized, and added an extra floor with two elevators.” The work took two years and was finished last year.

Today, the white and Champagne-colored stucco facade looks much the same as in old photographs: a single stone balcony, windows in strict geometric order and columns topped with floral details that reflect Hungary’s particular Art Nouveau style.

Inside, however, the main structure has been divided into six apartments, and the former copper works at the rear houses 10.

The penthouse, which covers 107 square meters, or 1,152 square feet, has two bedrooms, a bathroom and gas heating, and it is on the market for 79,882,500 forints, or about $366,000. There also is a two-bedroom loft with ceilings 5 meters, or 16 feet, high and geothermic heating priced at 56,941,500 forints, and a 31-square-meter studio for 20,088,900 forints.

“Every building has its story; we were lucky to find this one,” said Ms. Avruch, who worked on the project with her son Michael. “It became a very exciting project and I am very anxious to go ahead and do another one like this.”

Edit Bacskai, Mr. Mika’s great granddaughter who was born in the house in 1950, made a speech at the opening ceremonies for the development last year. She recalled that, before the work began, “it was dreadful to walk by the house, and almost impossible to explain its state to members of the family living abroad.”

Although the family received some compensation in recent years, it was not enough to buy back the house and restore it. “I was convinced it would be demolished,” just like the neighboring building, Ms. Bacskai said. “I was very happy that the investors preserved the outside and the shape of the old apartments.”

Not everyone is pleased with the way the neighborhood’s old buildings are being redeveloped.

Anna Perczel leads an association called “Ovas,” or “Protection,” which wants to protect historic buildings and monuments in the Jewish district.

“We are not against the new, but there are many empty plots for that,” Ms. Perczel said. She stressed the importance of protecting the historic district because its Jewish community still is thriving.

Change in this city of 1.7 million residents is hardly confined to Elizabethtown.

In 2007 Marco Novali, an Italian, and his two partners acquired a building on the quiet and leafy Rippl Ronay street. It is only minutes from Hosok tere, or Heroes’ Square, and the well-known Szechenyi Turkish-style baths.

“The crisis hit in 2008, and we decided to wait until some changes arrived,” Mr. Novali said as workers put the last touches on the restored building. “But in the worst period of the crisis, we decided to do the opposite of what the market was asking” and went ahead with renovations.

Much like the Mika house, they restored the exterior but developed a modern interior: 24 apartments that range from 40 to 300 square meters.

The apartments are for sale but, in the interim, they can be rented. For example, a 186-square-meter, three-bedroom apartment is listed for sale at €789,940, or $1,016,000, and available for rent at €4,700 a month. (Like some Budapest properties, these apartments are valued in euros rather than forints.)

The apartment building is run exclusively on solar power and geothermic heat, with a gym, sauna and concierge services for residents.

The first buyer, Mr. Novali said, was a Hungarian who bought an apartment as an investment for his children. Many foreign visitors, particularly Russians, have already arranged rentals.

When it comes to renovating buildings in Budapest, “it’s a small market — but a very interesting market because there is no competition,” Mr. Novali said.

Overall, the city’s real estate market has been holding steady, with a slight increase in sales in some central districts, said Zoltan Szemes, the head of Capital Real Estate, an agency that specializes in high-end properties in the city center.

“The number of interested parties from Australia and the Scandinavian countries is substantially higher than in previous years,” he added, noting that prospective buyers from outside the European Union must obtain permits and are restricted to two properties. However, Mr. Szemes said, none of his foreign clients have ever had problems with purchases.