1. PUBLIC SECTOR PROPERTY ASSET MANAGEMENT Policy, strategy and implementation: discontinuity of interest at the operational level − Case study of Budapest" PAL BAROSS FRICS Assistant to the Deputy Mayor for Municipal Finance and Assets BUDAPEST MUNICIPALITY

2. The „British experience”

3. THE POLICY PROPOSITION

4. MAGNITUDE OF ALLOCATION TO FUNCTIONS

5. MY „PAST” AS A DEVELOPER

6. MY OFFICE PROJECT

7. OFFICE ENVIRONMENT

8. MY „PRESENT” AS A PUBLIC EMPLOYEE

11. “all and all it is just another brick in the wall...” Pink Floyd

12. WHAT BUDAPEST CITY OWNS – AND WHY? 1. Land and buildings used to deliver a direct service to the public – for example, schools, health centers, elderly persons’ homes, residential units, public parks, cemeteries, ….. 2. Those that support service delivery in some way – most notably the town hall and other local administrative offices, vehicle depots …... 3. ‘Non-operational’ property – that is, property which is not used for, or in support of, mainstream service delivery. This includes commercial and industrial property and surplus property awaiting sale 4. Infrastructure companies ….. and their property assets

13. WHAT DO WE OWN? In terms of property types? (schools, libraries, swimming pools, community halls, leisure centers, office space, industrial space, flats, theatres, movie halls, hospitals, health centers …) NO IDEA In terms of values (price, operating costs, efficiency of use, environmental footprint..) NO IDEA In terms of legal structure of holding (freehold, condominium, contested ownership, rent…) NO IDEA In terms of budget allocation within the overal municipal budget what realistic savings to be achieved from rationalization, disposal or redevelopment. NO IDEA

14. WHO MANAGES IT? There is a fragmented management structure of companies, agencies, committees, institutions, departments with un-transparent budgets, non-existent benchmarks, ad-hock decisions about use, disposal or refurbishment. WE HAVE NO IDEA HOW MUCH RESOURCES ARE TIED UP IN THE BUDAPEST MUNICIPAL PROPERTY PORTFOLIO

15. OUR APPROACH PRIORITIES: 1.CREATE A MANAGEMENT INFORMATION CENTERD PROPERTY INFORMATION SYSTEM (CADASTER) 2.USE PROPERTY AS A SUPPORT FOR SERVICE DELIVERY 3.CONSOLIDATE PROPERTY MANAGEMENT FUNCTION IN A SINGLE ORGANISATION 4.ALL FUTURE RUNNING, MAINTENANCE, REFURBISHMENT OR DEVELOPMENT DECISIONS WILL BE BENCHMATKED AGAINST „ECOLOGICAL FOOTPRINT”

16. Dr. Gabor Bagdy MRICS, Deputy Mayor for Budget and Assets, Budapest OUR BUSINESS DISCILPINE Asset management includes strategic considerations as well as a range of property services. STRATEGIC ISSUES ACCOMODATION REVIEW AND SPACE MANAGEMENT PROPERTY INFORMATION BUDGET MANAGEMENT ENERGY MANAGEMENT PROPERTY SERVICES LEASE MANAGEMENT BUILDING MAINATENANCE VALUATION AQUISITION DISPOSAL REFURBISHMENT

17. ASSET KADASTER CORE ASSET DATA SITE BUILDING TENANT AREA ADDITIONAL DATA VALUATION CONDITION SURVEY RUNNING COSTS OCCUPANT(S) LEASE TERM(S) SPACE USE BENCHMARK ENERGY USE BENCHMARK USER DEMAND FOR IMPROVEMENT ANNUAL PROPERTY REVIEW 1.PROPERTY COSTS 2.PROPERTY REVENUES 3.INVESTMENT BUDGET 4.DISPOSAL REVENUES

18. SIGNIFICANT ASSET ISSUES PHYSICAL UPKEEP VALUE CASHFLOW FIT FOR PURPOSE SUSTAINABILITY USER/OCCUPIER

19. WHERE TO PUT THE EMPHASIS THE REAL ESTATE ASSET SERVICE ORIENTED STRATEGYBUSINESS ORIENTED STRATEGY OBLIGATORYVOLUNTARYBUSINESSVACANT PHYSICAL UPKEEPFIT FOR PURPOSE CASHFLOW MARKET VALUE SUSTAINABILITY

20. A building fit for the purpose, in the right location for users, can make the difference between a good and a poor service. THE NEW MANTRA

21. THE THEATRE PORTFOLIO OWNERSHIP UPKEEP OBLIGATIONS OCCUPANNCY RIGHT

22. USER MANAGED MODEL MUNICIPALITYPUBLIC COMPANYTHEATRE ASSET OWNER ASSET MANAGER ASSET USER NO PROPERTY RENT + SUBSIDY FOR PROPERTY OPERATIONS

23. „QUASY” ASSET MANAGER MODEL MUNICIPALITYPUBLIC COMPANYTHEATRE ASSET OWNER ASSET MANAGER ASSET USER PROPERTY RENT + MORE SUBSIDY FOR OPERATIONS