2009 - CRE

20
News from the Regions
Retail­Real­Estate
An­Underground­
Shopping­Complex­in­
Nizhniy­Novgorod
Modnaya­Ploshchad­Nizhniy­Novgorod,­part­of­
the­Atlas­Torgovli­Consulting,­plans­on­invest-
ing­$200­million­into­the­construction­of­an­
underground­shopping­complex­on­the­Gorky­
Square­in­Nizhniy­Novgorod.­According­to­
the­director­general­of­the­company,­Valeriy­
Kubata,­it­will­take­about­one­to­two­years­to­
organize­all­the­necessary­documentation­
and­to­design­the­complex,­while­the­actual­
construction­will­take­up­some­two­years.­
Atlas­Torgovli­plans­on­building­similar­com-
plexes­in­Yaroslavl,­Omsk­and­Rostov-on-Don.­
Maxim­Gasiev,­chief­operating­officer,­Colliers­
International,­told­CRE­that­“it­is­dangerous­
undertaking­new­projects­in­times­of­crisis.­
Especially­an­underground­retail­center.”­He­
believes­that­the­cost­of­building­an­under-
ground­complex­is­about­two­to­three­times­
more­expensive­than­an­aboveground­facility.­
In­order­to­recoup­such­investments­leasing­
rates­have­to­be­very­high.­“On­today’s­market­
place,­only­such­leasing­rates­as­those­in­
Moscow’s­center­and­St.­Petersburg­can­justify­
such­investments.­Such­projects­in­the­regions­
will­most­probably­prove­unprofitable,”­says­
Mr.­Gasiev.­Sergey­Bogdanchikov,­Director,­
Consulting­Department,­London­Consulting­
&­Management­Company­|­LCMC­also­has­his­
doubts­in­the­success­of­this­project.­“The­
project’s­documentation­for­permits­alone­will­
take­the­developer­some­1.5­years­and­the­full­
realization,­considering­the­Russian­realities,­
will­take­no­less­than­four­years.­And­so,­the­
announced­two­years­is­pure­utopia,”­considers­
Mr.­Bogdanchikov.­
Besides­the­problems­that­the­developer­
may­encounter­upon­building­a­shopping­
complex­underground,­identifying­tenants­in­
today’s­difficult­conditions­can­be­somewhat­
complicated.­According­to­Oleg­Efremov,­
retail­real­estate­consultant,­Cushman­&­
Wakefield­Stiles­&­Riabokobylko,­leasing­a­
facility­in­times­of­crisis­is­a­most­complicated­
task.­“Today’s­number­of­companies­willing­
to­develop­a­chain­and­open­additional­retail­
facilities­has­dropped­substantially,­and­put-
ting­together­a­pool­of­tenants­is­becoming­
increasingly­complicated,”­commented­Mr.­
Efremov.­­
Office­Real­Estate
A­Business­Center­
Rating­to­be­Created­
in­Novosibirsk
Over­40­property­managers­and­owners­of­
offices­in­Novosibirsk­have­decided­to­create­
a­Business­Center­Rating­in­Novosibirsk.­The­
project­coordinator­will­be­the­Siberian­Guild­
of­Managers­and­Developers.­The­rating­will­
rank­most­of­the­existing­office­facilities­in­
Novosibirsk­according­to­a­whole­range­of­cri-
teria,­from­post­spacing­to­location.­Landlords­
expect­that­precise­information­regarding­the­
merits­and­deficiencies­of­each­facility­will­
help­in­objectively­determining­the­leasing­
rates.­Three­experts­will­evaluate­the­facilities:­
a­real­estate­market­analyst­and­marketing­
specialist,­an­air­conditioning,­heating­and­
ventilation­specialist­and­a­communication­
and­alarm­specialist.­The­assessment­provided­
by­the­working­group­will­be­evaluated­by­an­
expert­council.­The­council­will­be­made­up­of­
real­estate­market­analysts,­air­conditioning,­
heating­and­ventilation­specialists,­commu-
nication­specialists,­commercial­real­estate­
brokers­and­others.
“The­major­reason­for­creating­a­rating­at­
the­present­time­is­to­provide­assistance­to­
landlords­for­determining­the­leasing­rates,­cre-
ate­a­transparent­market­place­whereby­leasing­
rate­negotiations­will­be­simpler­for­landlords,”­
explained­the­president­of­the­Siberian­Guild­
of­Managers­and­Developers,­Oleg­Lugovoi.­The­
possibility­of­better­evaluating­the­compara-
tive­merits­of­various­business­centers­and­the­
appropriateness­of­the­rates­will­benefit­ten-
ants­as­well.­­
Inauguration
A­New­Hyatt­in­
Yekaterinburg
The­opening­ceremony­of­the­hotel­took­
place­on­February­26­2009.­Initially,­the­
Hyatt­Regency­Ekaterinburg­was­to­begin­its­
operations­on­the­March­8,­2008.­However,­
the­building­wasn’t­ready­on­schedule­and­the­
opening­was­postponed­until­July.­Once­again­
the­construction­was­delayed­and­the­opening­
was­delayed­till­September.­On­the­September­
10­the­Hyatt­published­a­press­release,­­which­
described­the­future­interior­of­the­hotel­and­
a­little­later­presented­an­internet­page­of­the­
hotel.­The­inaugural­celebration­was­promised­
for­the­end­of­2008,­and­the­unofficial­date­
mentioned­was­December­1.­­The­exact­date­
however­for­the­opening­remained­unknown.
The­Hyatt­Hotel­is­one­of­the­facilities­
being­built­for­the­Summit­of­the­Shanghai­
Cooperation­Organization.­The­major­investor­
in­the­construction­of­the­facility­is­UMMC.­
The­overall­cost­of­the­20-story­hotel­with­300­
rooms­is­estimated­at­the­first­phase­at­$107­
million.­The­plan­was­that­30%­of­the­costs­
would­be­assumed­by­UMMC,­and­the­remain-
ing­70%­by­a­syndicated­loan­by­international­
banks­under­a­guarantee­by­a­French­Export-
Import­agency.­At­the­beginning­of­the­con-
struction,­the­UMMC­management­announced­
that­the­funding­of­the­hotel’s­construction­
was­being­accomplished­through­assistance­
from­the­Societe­Generale­and­BCEN-Eurobank,­
and­received­through­the­VneshTorgBank,­in­
the­role­of­agent.­The­overall­loan­-­$80.5­mil-
lion,­with­$70­million­as­an­export­loan­guar-
anteed­by­the­French­insurance­agency­COFACE­
for­a­term­of­10­years­and­nine­months,­and­
$10.5­million­–­a­commercial­loan­for­a­term­
of­8­years­and­3­months.­Whether­this­money­
was­received­and­how­much­of­it,­the­UMMC­
does­not­specify.­Experts­note­that­the­delays­
in­the­opening­of­the­Hyatt­indicate­that­the­
holding­is­suffering­certain­financial­difficul-
ties.­­­
Project
Rodex­Group­
Sprinkled­the­Island
Rodex­Samarra,­part­of­the­federal­develop-
ment­network­Rodex­Group,­has­finalized­the­
construction­of­a­non-retained­island,­16­km­
from­Samarra,­which­will­host­a­cottage­settle-
ment­to­be­named­Tsarev­Grad.
The­company­reportedly­used­340,000­
cubic­meters­of­sand­to­build­the­island.­The­
company­is­presently­building­the­entrance­
group,­the­first­and­second­phases­of­the­elite­
class­Tsarev­Grad­with­51­homes.­The­volume­of­
the­investment­for­the­project­is­estimated­at­
412­million­rubles.
The­project­designed­by­Rodes­Group­is­
the­only­one­for­the­time­being­to­have­been­
brought­to­life­amongst­all­those­that­were­
announced­in­Russia.­The­intention­lately­of­
filling­new­territories­was­made­by­many.­In­the­
south­of­Russia­alone­there­were­three­projects­
announced­(the­island­in­the­framework­of­the­
Novy­Bereg­project,­and­the­islands­of­Khomar­
and­Dagomar).­However,­because­of­the­crisis­
and­lack­of­legislative­acts­regulating­the­
island­development,­the­projects­for­the­time­
being­remain­on­paper­alone.
Lev­Pukshansky,­vice­president,­Morskoi­
Facade,­told­CRE­that­“such­projects­require­
important­investments.­In­times­of­crisis,­such­
major­urban­developments­aren’t­the­best­
idea.”According­to­Mr.­Pukshansky,­the­devel-
opment­of­projects­for­the­creation­of­islands­is­
becoming­increasingly­complicated­because­of­
a­lack­of­legislation.­­
For news from the Northwest, see page 81
For news from the South, see page 89