Lightly grease 2 x 900g loaf tins and line them with baking paper with some overhanging. Set aside.
Pour the milk into a small saucepan set over low heat and add cubed butter. Heat it up gently (but avoid bringing it to boil), swirling the saucepan every now and then to encourage the butter to melt. Remove from the heat and set aside to cool for 5 minutes, or until the mixture is lukewarm.
Place the flour, yeast, sugar and salt in a large bowl or a bowl of a freestanding mixer with hook attachment and stir to combine. Add one egg and lukewarm milk and butter mixture and mix it on low speed for couple of minutes, until the dough starts coming together. Increase the speed to medium and continue to mix for another 4-5 minutes, until you have smooth and elastic dough that no longer sticks to the sides of the bowl. Alternatively, you can knead it by hand, until you have smooth and elastic dough.
Transfer the dough into a clean, lightly greased bowl, cover and let it rise for 1-2 hours or until it has doubled in size. When ready, transfer the dough into a lightly floured surface and roll it into rectangle, roughly about 40 cm x 60 cm, with the longer edge facing you. You can trim the edges of the rectangle, to make them a bit neater, using a sharp knife or a pizza cutter, if you'd like.
Spread the nutella filling over the dough. Sprinkle with chopped hazelnuts (save a small amount of hazelnuts for the topping, if you would like). Starting from the long edge closest to you, roll up the dough into a large sausage/ log, keeping the seam underneath.
Cut the dough log in half, so you have two smaller logs and transfer them to the fridge for about 20 minutes. This step is not necessary, but it will help the filling to firm up and set a bit more, which will make the shaping process much easier.
Using a large sharp knife, slice the dough log lengthways, through the middle, cutting it into two long pieces.
With the cut-sides facing upwards, cross both pieces of the dough in the middle, then twist the dough towards the top and bottom, to make two-stranded plait. Press the ends together to seal. Repeat with other log of dough. Gently transfer the dough into prepared loaf tins, cover and set aside somewhere warm, allowing it to prove for half an hour, or until doubled in size.
While the dough is proving, prepare the sugar syrup. Combine the sugar and water together in a small saucepan and bring to boil over medium heat. Cook for 5 minutes until the mixture becomes thicker and syrupy. Remove from the heat and allow to cool.
Heat the oven to 190 C (170 C fan). Brush each babka with an egg wash, sprinkle with some more chopped hazelnuts on top (optional) and bake for 15 minutes. After 15 minutes, reduce the oven temperature to 170 C (150 C fan), and bake for another 25-30 minutes, until golden brown and the skewer inserted in the middle comes out clean. Remove from the oven.
Transfer the babkas in the tins into a wire rack and brush generously wit sugar syrup. Leave in the tins to cool for 15 minutes, then lift from the tins, slice and enjoy!
To make your own spread, place 200g of butter, 250g of sugar and 200g of chopped dark chocolate (min 70% solids) in a small saucepan and allow to melt over a small heat. Keep stirring from time to time, to combine all the ingredients well. Remove from the heat, add 50g of cocoa powder and stir well. Transfer to a bowl and set aside to cool, before using in the recipe.
Make ahead instructions:
Prepare the dough up to step 4 in the recipe. Transfer the dough into a clean bowl, cover and place in the fridge overnight. Next morning remove from the fridge and continue to step 4.
You can also prepare the dough, spread the filling and chopped hazelnuts on top of it, roll it into log and then store it in the fridge overnight. Next morning, remove the dough from the fridge and continue to step 6.
Shaped babka can also be stored in the fridge for the overnight prove. Next day, remove them from the fridge, let them sit at room temperature for about 30 minutes, brush with an egg wash and bake as per the recipe instructions.
Babka is best eaten fresh, on the same day that it is made. Any leftovers can be wrapped in clingfilm or kitchen foil and stored at room temperature for 1-2 days.
You can freeze baked babka for up to 2 months. Wrap it tightly with clingfilm, then place in the freezer-friendly container and transfer to the freezer. Thaw at room temperature overnight.