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As a new recording was leaked in connection with the sale of City Hall, Budapest’s leadership hasn’t ruled out that a manager of one of the companies undertook an underhanded action. Gergely Karácsony and his team, however, insist that the sale was only one of many options, and they eventually took it off the table a year ago. Karácsony labels the case ‘fake hype’ and is rather outraged for the government’s new move to halve Budapest’s business tax income.

As we previously reported, the Budapest municipality, led by the opposition, came under attack last week for allegedly having made steps to sell City Hall after two articles published by Fidesz-linked Index.

Mayor Karácsony Denies Plan to Sell Budapest City Hall
Mayor Karácsony Denies Plan to Sell Budapest City Hall

"I repeat: no decision has been taken to sell City Hall, nor has the Municipality of Budapest taken any steps to ensure that it is sold, and therefore it hasn't given any instructions to do so. Anything else is a lie," the politician commented.Continue reading

Initial audio recording: A property deal in Fidesz-led Budafok

A little later, an audio recording was published dealing with the sale of another worthy property. In the footage, two unidentified men can be heard talking. One of them, named Zsolt Berki (Northern Rock owner, the company’s name was also mentioned in Index articles claiming Berki was one of the men involved in talks about the City Hall sell-off), described in detail how he had obtained a property under suspicious circumstances in the capital’s municipality with Berki’s help.

According to government-critical independent news site Telex, the land in question in Budapest’s 22th district (Budafok) was apparently sold to a businessman, linked to ruling Fidesz’s circles. A statement from City Hall pointed out that the deal, however, went lawfully, transparently (although it had been sold for more than it had originally been estimated by the local government), and in accordance with the district’s Fidesz-led local government. He also said that the selling procedure was kick-started under former, Fidesz-backed mayor István Tarlós, who has denied these claims.

Karácsony said that he wouldn’t launch an inquiry as both the identity of the speaker is unknown and the claims are untrue.

Latest recording: Potential sale and the construction of a new one

In this latest, more important recording, Balázs Barts, the CEO of the Municipality-owned Budapest Capital Property Management Center, can be heard talking about a document he presented at a cabinet (city council) meeting. The document is about the City Hall building and the 4.7 hectares of land belonging to it, of which 3.9 hectares would be sold and 8,000 square meters would be kept. Barts says that he is not a politician, but an architect, but if it were up to him, he would do it this way.

Barts also talks about upcoming important dates, such as the 2022 general elections, the 150th anniversary of Budapest in 2023, and the municipal elections in 2024, which makes it more complicated. So they’ll do the public park first, because they promised, and the facade of the building, but the park might have to be torn up later because of the (hopeful) construction.

In order to avoid these problems, Barts says he can get around the public works by invoking copyrights: he will make a plan so that by the time the park is to be built, there would be a 250-space car park underneath, where the two news wings of the building would be built. Then a new City Hall could be built on the corner.

Budapest Municipality: Only a matter of preparatory discussion

In response, the Municipality of Budapest admitted that a sale had indeed been a matter of discussion. It made public a preparatory study for decision-making on the short, medium, and long-term development options of City Hall. The preparatory study, put together by the Municipal Property Manager, took stock of the possible short, medium, and long-term development options for City Hall, along with estimations of their revenues and costs. In order to provide these evaluations, market consultations had to be carried out, the mayor’s office explained in a statement.

Finally, this preparatory material also proposes that, after weighing the advantages and disadvantages of the various options, City Hall should remain in the possession of the Budapest Municipality. The mayor’s cabinet approved this proposal on November 26, 2020, they added.

Fidesz calls for probe into reported plans to sell Budapest City Hall building

The Budapest chapter of Hungary’s ruling Fidesz party has called on Gergely Karácsony, the city’s mayor, to order an investigation into reports that Budapest’s leadership was planning to sell the City Hall building.

Zsolt Láng, the group leader of ruling Fidesz in Budapest’s municipal assembly, said that while “more and more audio recordings and documents are turning up” on the sale of the building, Karácsony was “heard either denying the plan or contradicting himself.”

Láng called on the city’s leadership to launch an investigation into the matter and clarify whether a study has been carried out on the sale of the building and if anyone had known about it and reviewed it. He also called on Karácsony to clarify who had authorized the director of the Budapest asset management company to consult with market players on the study. Láng added that if Karácsony

doesn’t order an investigation, his behavior will seem very suspicious.

The Fidesz politician said this made it hard for him to believe that Karácsony had not known of the plans to sell the building.

Underhanded action?

That something must have happened in the background, both Karácsony and one of his deputies appear to confirm, as they just announced that Property Management leader Barts, potentially along with some others, may be sacked in the near future.

While both Karácsony and his deputy are demanding answers from Barts, the two leaders once again insisted that a sale was out of the question- it was only one of the options they had mentioned a year ago.

Kiss also stated that they didn’t give Barts any mandate to engage in any kind of negotiations, thereby suggesting tough consequences for the manager. He recalled that Barts was appointed by the previous mayor, Tarlós.

Karácsony: Instead of fabrications, Budapest Fidesz should focus on business tax income deprivation

As Budapest Fidesz demands answers from Gergely Karácsony and an internal inquiry into finding out the details of the case, the Budapest mayor is still labeling the whole case ‘fake hype’ and the newest smear campaign from the ruling parties. “Apparently, the lies discrediting [newly-elected PM candidate of the opposition cooperation] Péter Márki-Zay aren’t yet ready,” he commented on Facebook.

Fact

On Monday, Karácsony also announced his plans with the City Hall and its surroundings: a park will be built on the site of the parking lot (one of his campaign promises), the Merlin Theater will undergo a renovation, and the Budapest Gallery will be located in the Gerlóczy Street wing.

In response to Budapest Fidesz, Karácsony said the ruling forces’ local politicians should engage in self-examination instead, pointing out that the Interior Ministry once again moved to deprive Budapest of HUF 40 billion (EUR 110 million) in funds due to come in from the local business tax.

While the City Hall’s non-existent sale is their biggest problem, they are completely and senselessly letting it go without a remark that the government, by halving the business tax announced today, will take as much money from the municipality this year and next year as the City Hall’s building is supposed to be worth.

featured image: Karácsony (in the middle) in the Budapest Assembly. On his right is deputy mayor Ambrus Kiss; via Zoltán Balogh/MTI