Budapest Tunnel for Sale

At 7:53 AM this fine morning, my old friend Mike Smithing and I each had a swig of Unicum and unfurled a banner over the Budapest Alagut. And then we ran like hell.

Felt like high school all over again.

Click photo to enlarge

For immediate press release

April 1, 2004

Colliers International has been instructed by the City of Budapest to offer the Budapest Tunnel for Sale to prospective investors. The Budapest Tunnel will be sold through a two round tender. Complete tender documentation is available for purchase from Colliers International from April 5, 2004. Bids submissions for the qualifying round must be delivered to Colliers International’s offices at Mammut 2 by 13.00 on April 30, 2004, exactly 147 years to the day after the tunnel was first opened to vehicle traffic.

The Tunnel Company was formed in 1851 to realize the Budapest Tunnel and construction commenced on February 10, 1853. The tunnel opened to pedestrian traffic while still under construction on March 6, 1856, and the first vehicles passed through the 350 meter tunnel on April 30, 1857. The Budapest Tunnel charged tolls from its opening through 1918. Pedestrians originally paid one Krajcar and horse carriages paid three Kajcar. While these fees were relatively minimal, as are those proposed for the privatized tunnel, the Budapest Tunnel generated 5,968 Ft. in revenue for its owners during its first two months of operation.

While exact traffic figures are not available, the Budapest Tunnel is used by approximately 10,000 vehicles per day. Colliers preliminary research indicates that it should be possible to charge tolls in the range of 150-200 Ft. per use without significantly decreasing current traffic levels. At the same time, increasing the toll to 500 Ft. per use is projected to decrease traffic to some 7,000 vehicles per day which will significantly increase revenue while decreasing maintenance costs associated with the pollution.

The Budapest Tunnel was significantly damaged during the Second World War, however it was repaired in 1949 and was fully renovated in 1973. The Budapest Tunnel is a protected historic landmark and renovation works can only be performed with the approval of the Monument Authorities. Fortunately, only minor cosmetic modifications are necessary and the Monument Authorities have granted preliminary approval for the replacement of the current mosaic tiles with a more attractive, easy maintenance surface. 

The minimum price for the Budapest Tunnel has been set at 100,000,000 EUR + VAT. This sale price includes the tunnel, interior road surface, gates at both ends of the tunnel and the original gate-keeper’s offices at the Chain Bridge end of the tunnel which are suitable for renovation to high-end residential or office use.

For details contact: Michael P. Smithing, Managing Director, Colliers International (Hungary) Ltd.