Building Ads Leave Many in The Dark

Her nose is pressed firmly against the street-side window of her Tverskaya apartment. Her eyes dance through a maze of metal bars, wood planks and endless rows and columns of punched-out vinyl holes as she strains to make out forms below.

There's not much sun to speak of in Moscow in December. But deprived of it for more than a year by a gargantuan advertising banner plastered to her building's facade, this British expatriate now pines for even the faintest dusty gray-blue glow.

"It drives me insane. There's no natural daylight whatsoever coming into the front of my house, and you feel it so badly in the winter when there is already a lack of light," said the tenant, who asked not to be identified for fear of repercussions from her building's manager.

"I could put up with it if there were actual repairs going on, but there is nothing. Nada," she said. The scaffolding for pretend reconstruction is clearly there just for the advertising."

In April 2006, after scaffolding was put up outside her building on 32 Tverskaya-Yamskaya Ulitsa, capital repairs began on its two street-side facades, said Kirill Pokamestov, the chairman of the building's housing cooperative.

But 2 1/2 years and millions of dollars in advertising revenue later, only one portion of the side facade has been restored. Scaffolding on the yet-to-be-restored portion of the side facade and on the front -- the building's main advertising surface -- remain unused.

Hundreds of Moscow residents are living behind advertisements -- and they are not happy about their views being blocked. Many suspect that private and municipal building administrators are earning much more money than what is needed to fix their buildings.

Corporate banner advertisements attached to construction nets cost $50 to $100 per square meter, depending on the total amount of square meters rented, said Andrei Beryevkin, director of Espar-Analitik, a Moscow-based advertising-market research company.

Without giving exact figures, Pokamestov said advertisers pay less than $200,000 a month for the front facade of 32 Tverskaya-Yamskaya, which is completely covered in an advertisement and measures about 3,600 square meters. Advertising also covers a large portion of the nonrenovated side facade.

Beryevkin said the space could be rented for as much as half a million dollars per month.

Given the total facade surface -- 10,000 square meters -- and minimum cost of repairing one square meter of the building -- 3,750 rubles, said Pokamestov -- the facade could be repaired for about $1.4 million. Using the very low end of analysts' estimates ($200,000) for the monthly advertising revenue of just one facade, the building has brought in about $6.2 million over the course of the past 2 1/2 years.

Pokamestov said construction work continued until August, when the building's construction permit -- granted by municipal agencies -- expired. The housing cooperative applied to extend the permit for facade reconstruction in June, but did not receive the permission until this month. Now, Pokamestov said, it's too cold for construction work.

The tenant, however, argued that no work had taken place since she began renting the apartment in the fall of 2007.

"At first I kept thinking 'it will come down soon.' But it hasn't, and not a stitch of work has gone on while I've lived here," she said. "The only time you ever see workmen up here is when they are changing the advert."

Large-scale banner advertisements cover 72 percent of the 102 debris nets draped over buildings under repair or construction, according to the latest data collected by advertising company LBL Communication.

In accordance with the law, any building undergoing facade repairs must encage its scaffolding with a debris or construction net to protect workers and prevent light debris from falling on pedestrians below.

Building owners must receive authorization for reconstruction from the city's Administrative-Technical Inspectorate to sell the facade space to advertisers.

Building owners contacted for this article were reluctant to discuss their advertisements. The Administrative-Technical Inspectorate was not immediately available for comment.

But Vladimir Makarov, head of the Moscow Advertising Committee, the municipal authority that controls the sale of advertising space in the city, said the inspectorate has dealt with a few cases of fictitious facade reconstruction, put up for the sake of gaining permission for advertising.

"We don't handle reconstruction directly," he said. "The inspectorate verifies if reconstruction is going on or not going on and brings us authorization to grant the building permission to advertise. But if tenants believe this is going on they should write to the committee."

Incidentally, St. Petersburg banned all on-street and building banner ads this month.

Owners of centrally located Moscow buildings, like 32 Tverskaya-Yamskaya, are often eager to attract corporate advertisers, said Yevgenia Yunisova, director of Uprav Dom, a Moscow nonprofit organization that advises tenants on how to form and operate housing cooperatives.

"Those that have the advantage of living on a major street with a valuable facade want [advertising] because the money can pay for the building's capital and routine repairs, Yunisova said.

Less than 5 percent of Moscow housing cooperatives sit on such prime advertising locations, she said.

The demand for construction-net advertising space is high because it is considered elite in a city plastered with billboard ads.

In an effort to drain the city's advertising glut, the Moscow city government published in July a decree detailing deadlines for determining lists of outdoor advertising installations -- in and around historical areas, buildings, cultural heritage sites and monuments -- that will be taken down.

"The historical center of Moscow is, without question, overloaded with advertising," said Makarov of the advertising committee.

The overload, however, is tightly interconnected with the booming growth in Russia's retail sector, he said. "Automobile sales shot up about 40 percent in 2007. The companies wouldn't spend that kind of money on advertising if people weren't buying," he said.

Makarov said cities in Western Europe such as DЯsseldorf and KЪln experienced similar "heavy advertising phases," about 10 years ago when there was fast retail-sector growth in Germany.

By Jan. 1, about 50 percent of the 800 advertising installations near the Kremlin will be demounted, he said. Other contracts will expire in 2010 and 2011.

But the July ordinance hasn't caused a drop in the number of outdoor advertisements on construction nets. While 68 construction nets were covered in advertising in July, the number grew to 73 in October, according to LBL Communication. Fifty-six of the 73 advertising nets are located in the city's historical central district.

Some tenants who live in advertising-sheathed buildings suspect that the cost of repairs is miniscule compared to revenue the advertising rakes in and are now questioning the real beneficiaries of the advertising-revenue stream.

"It's clear somebody's already made a couple million off this space," said Matt, whose windows look out onto the back of a giant Sony advertisement facing the downtown Smolenskaya metro station. "It's been up since the summer. I was told the facade reconstruction would be done on Oct. 24. Apparently it is done but now they're just keeping the advertisement there."

Matt, who pays $3,800 a month for his apartment, finds it impossible to tell if it is raining or snowing because of the advertisement.

Masha Senatskaya was not particularly bothered by the slightly higher level of darkness that resulted from her building's corporate banner advertisement, but she did not fail to notice that the capital refurbishment took "extra long" to complete.

"The ad was removed from the facade only after a meeting of the residents, who had an idea about the laws and rules," said Senatskaya, whose apartment is on Kutuzovsky Prospekt. "The way that people are making money on this is unbelievable."