Buying property abroad: Return of the natives

Many of us dream of buying property abroad, but for aristocrats returning to their ancestral homes the process is rarely smooth. Andrew Eames reports. Since the fall of the Berlin Wall, those countries which were once under Communism have seen massive change. One aspect of this is the rapid upgrading of capital cities like Budapest, Sofia and Bucharest, with low-cost airlines in the skies, cars on the roads and designer labels in the shops. The second is a movement of people unprecedented in modern times, as those low-cost carriers have ferried workers from Eastern Europe in one direction, and holidaymakers and second-home owners in the other. A small but significant subset of these homeowners are those wishing to return to the land of, not their birth, but their origin. Returning to the territory of their ancestors, the aristocrats are back. In some ways, they haven’t been away for long. For centuries before Communism, nations like Romania, Hungary and Bulgaria were fundamentally feudal societies run by wealthy titled landowners who were pretty much given free rein by their respective monarchs. Then the steamroller of political change, accelerated by war, knocked those monarchs off their thrones and dispossessed the landowners of their large estates. And if they didn’t manage to flee in time, then it dispossessed many of them of their lives too. What happened in the intervening years is a story too long and too diverse to tell here. Suffice to say that many of the exiled royals ended up in Portugal, on the so-called Coast of Kings at Estoril, while the former aristocrats were forced to begin new lives in Europe, with many ending up in Argentina and the Americas. There they started at the bottom again as construction workers, salesmen and taxi drivers, having lost the only real asset they had – their land. But now the political pendulum has swung again in the east, and the royal heirs are moving quietly back into pole position, in case monarchy comes back into fashion. In Serbia, Crown Prince Alexander is back in the Royal Palace in Belgrade, from where he is informally creating commercial links with the outside world. In Bulgaria, Prince Simeon Saxe-Coburg, from the same rootstock as the British royal family, recently had a spell as prime minister. In Romania, two branches of the Hohenzollern family, Princess Margarethe and Prince Paul, are both in Bucharest and both assert they are the direct lineage for any restoration. And in Hungary Archduke Georg Habsburg-Lothringen sits on the board of various media companies and his wife Eilika runs a riding stables for the disabled. These potential kings and queens are doing their bit for their countries, economically and socially, but they have to be very careful how they tread, so as not to alienate public opinion. For the aristocrats, out in the countryside, there are fewer restrictions on what they can do. Deep pockets, however, are a prerequisite for success, particularly for the long legal battles it usually takes to get their property back. The restoration process varies from country to country, and case to case. In former East Germany, for example, it depends on when you left, who you were, what has happened to the property since, and whether you’re prepared to enter a local legal process. Faced with all this, many returnees have dug into their own pockets. Baron Helmuth von Maltzahn, whose family built Schloss Ulrichshusen back in 1562, had to spend £3 million to buy back its blackened ruin in 1993 and restore it to the grand hotel it is today. The von Maltzahns also started a music festival, and that, along with the hotel and parkland, attracts 50,000 visitors a year to a region of Mecklenburg-Vorpommern which badly needed some new sources of revenue and employment. The baron is not alone in these efforts: around 100 other noble families have returned to the former GDR, re-establishing themselves in local communities whose economies have struggled in post-Wall years. They’ve been dubbed the “gumboot barons” because of the energy with which they themselves have tackled even the most basic labouring jobs. Over in Hungary, the property restoration process was partially endorsed by the government after the collapse of Communism. Those who could prove lineage and ownership were given vouchers redeemable at state land auctions in the relevant regions, although the vouchers’ value usually only amounted to a fraction of that of their ancestral holdings. It was with a combination of vouchers and his own investment that Count Jozsef Hunyady was able to build a manor house, which he and his wife operate as an upmarket guesthouse, and to start again with the Hunyady tradition of winemaking. Today, he and his winemaking partner produce around 10,000 bottles of mainly Pinot Noir a year, and employ 20-35 people, depending on the season. Hungarian returnees like Jozsef Hunyady initially came back to Budapest in the 1990s, from where they spread into the surrounding regions over the succeeding years. Count Peter Bolza, one of the few who has remained in the city – although he too is in the process of acquiring a manor house in the countryside – said: “Back then there were around 30 of us of a similar age.” Count Bolza, who currently works in the banking sector, believes that returnees like him have been able to offer useful skills to outside investors. He said: “We have the language skills, plus the experience of the culture, so we’re well placed to make a bridge between societies”, especially in a place like Hungary, where the language is so difficult. But the return takes effort and commitment and is not to everyone’s taste, and more than 90 per cent of exiles have stuck to their new lives, particularly as their old ones are now such a distant memory. Count Bolza said: “My brother was three years-old when the family left. He has only been back once and that was when my father asked him to.” The younger returnees have no bad memories to hold them back and arrive in their spiritual homeland believing anything is possible. One such person is 40-year-old Budapest-based Catherine Dickens, whose mother, Countess Jeanne-Marie Wenckheim, grew up in fine style in the rural east of Hungary, in the hamlet of Doboz. Catherine now runs a thriving property business restoring grand Budapest apartments, and her mother is back in the village of her youth, renting the priest’s house. Returnees like these are often viewed with distrust, particularly in rural settings. Many decades of Communist disinformation did a lot of harm to the image of the aristocracy and, just occasionally, the aristocrats themselves display a lack of sensitivity to local sentiment. Over in Romania, one such case is currently playing out over the issue of Bran Castle, which has strong associations with the Dracula story and is one of the nation’s key tourist attractions. The castle was returned by the state to a member of the Habsburg family living in New York, who then put it on the market for £40 million, prompting a row in Romania as to whether it should have been given back to him at all. Unlike in most post-Communist countries, Romanian law actually allows for the complete restoration of land and buildings to previous owners, provided ownership is proven. As a result, the country’s legal system is creaking under the demand. Gregor Roy Chowdhury, the half-Indian heir to the Mikes estate, is back in residence at Zabola, along with his brother and his mother, the Countess Mikes. But there’s a long battle still ahead to try to get back land-holdings outside the immediate surroundings at Zabola, particularly as the most valuable property is now part of the city of Cluj. As for the two dilapidated manor houses at Zabola, the cost of making them habitable is huge. The Chowdhurys have started a small but select tourism business: they rent out the main house for major events and are refurbishing the stables to host business conferences in order to generate the necessary revenue. Some 50 miles north-west of the Chowdhurys, Count Tibor Kalnoky is a pioneer of rural tourism in Transylvania. Since his return 12 years ago, he has refurbished some of the family properties in the village of Miklosvar into popular upmarket guesthouses, providing employment for 20 villagers. Like the Chowdhurys, the count’s long-term plan is to use the revenue from the business to restore his two Kalnoky manor houses, and meanwhile he also advises other aristocrats on their own restoration projects, including his friend Prince Charles, who has bought village houses in the region. Count Kalnoky is concentrating on the future prospects of family buildings and local communities, but there are other returnees whose interest is principally in the land itself. Baroness Ileana Kripp and her husband, Baron Jakob Kripp, took back the ownership of the Stirbey vineyards at Dragasani, Romania’s Tuscany, in 2001. In the years that followed, production from the 20 hectares has increased to 80,000 bottles a year, and is rapidly improving in quality. Baron Jakob acknowledges that he and his wife were lucky in what they got. He said: “Eighty or 90 per cent of Romania’s vineyards were ruined under Communism, but here the vines were well maintained and we have relatively young plants.” The difference between then and now is that, while the Communists produced a poorer quality wine at Stirbey and exported most of it, the Kripps are producing a far better wine and more than 70 per cent is being sold at home. And they can do that because Romania now has a cross-section of the community who can afford it, and are keen to drink it. The aristocracy is back. Websites The Maltzahns at Ulrichshusen, Mecklenburg: ulrichshusen.de Catherine Dickens in Budapest: ulrichshusen.de Count Jozsef Hunyady near Lake Balaton: hunyady.hu The Mikes Estate in Romania: zabola.com Count Tibor Kalnoky in Romania: transylvaniancastle.com Baron and Baroness Kripp in Romania: stirbey.com