Waltz on the Danube Essay

4981 Words Mar 24th, 2006 20 Pages
Waltz on the Danube

Executive Summary
The purpose of this case is to establish the viability of the €75 million shopping center project located along the Danube River in the city of Gyor. As the director of Hungarian operations for ECE Projektmanagement Dr. Philipp von Wilmowsky had worked for two years on the 30,300 square meter shopping center. So while Gyor lack significant a shopping center thus creating a site that had great potential there were several major questions that would define the success of the project.

The question that transcends the project is whether equity investors be sufficiently rewarded to justify there financing interests. The answer to this question is dependent on several factors including the
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So while the growth potential facilitates opportunity, the lower income per capital must be recovered through greater reach. Lower levels of development and therefore less competition makes this possible but is a major question mark of whether the market in Gyor will support the development project.

The success of the 2002 opening of a suburban mall near Budapest would be supportive the viability of the potential market in Gyor. Based on the location, the economic factors, and the demographics of the area, Gyor would also be the next logical site for ECE to expand. The development project therefore makes sense in Gyor, providing a strong investment opportunity to add value to the company.

Are rents adequate to support this development?

The tenant structure of the shopping center is an important factor in ensuring rent is adequate to make the project viable. The fact that Philipp conceded the hypermarket could have a negative effect on the overriding success of the project. ECE strategy typically relied on these large self-service retail stores. Hypermarkets are very desirable to customers since the warehouse structure enable the stores to offer a wide variety of products (i.e. fresh food, beverages, home supplies, electronics, clothing, car accessories, garden furniture etc.) at discounted prices. This lack of a hypermarket must be offset by assurance and

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