Real Estate


Q3 2006

News in Brief

  • January 01, 1970

Editors' View

  • January 01, 1970
We’d like to begin by extending a welcoming hand to delegates at this year’s Expo Real exhibition in Munich. Starting off a letter from the editors like this is starting to look like a bit of a cliche, but we make no apologies for it. Active though the Russian market is, it goes a lot further than high-profile developments in central Moscow. There’s a massive country out there ready to absorb development and investment as you’ll see from our look at the market in Kazan and at the warehouse chains accompanying regional retail expansion. So we wish you all a successful visit to this year’s ExpoReal and hope that it will be the start of many long and fruitful partnerships!

Hotel Market Update

  • January 01, 1970
Astronomical room rates have ensured a record revenue performance year for operators in 2006 — but decreasing occupancies with additional supply increases on the way may make it a whole new ballgame.

Regional Warehousing

  • January 01, 1970
This is the first year when projects by regional warehouse networks worthy of attention have been announced. Local players in the regions have also been noticeably starting to take an interest in the warehouse market. More and more inquiries and proposals for quality warehouse construction projects or adapting existing assets have been coming in from owners of various companies and sites in the regions. What are the reasons behind this interest?

Business Park Overview

  • January 01, 1970
Business park is a term that, like many other adopted from Western real estate markets, is all too often misused and misunderstood in Russia. Although many projects around Moscow are described as such, it tends to have a rather loose meaning on this market and can equally refer to a large, newly built Class-A office complex on the Garden Ring or Class-B reconstructed factory premises with poor transport access.

Dangers of СCut-and-PasteТ Regional Shopping Malls

  • January 01, 1970
Over the last few years, retail development activity has been slowly but surely expanding out of Moscow into the Russian regions. Currently numerous large-scale projects are either under construction or in the pipeline, and not only in cities with a population of over a million inhabitants, but also in smaller regional cities, such as Yaroslavl, Kaliningrad and Kaluga. Today, regional expansion is a major challenge for developers who need to answer the question: how do you create a successful and dominant shopping center network, within a short time frame, in the world’s largest country?

Giant Hits Russia

  • January 01, 1970
September 21 sees the long-awaited entry to the Russian market of a world residential realty giant — Century 21, with currently more than 7,800 franchised sales offices and 144,000 agents in over 50 countries and territories. The CEO of Century 21’s Russian operations is Canadian Nuri Katz, a well known figure on the Moscow real estate market, who founded Evans Property Services and since 2003 has been a managing partner of Beatrix. He talked to Edmund Harris about Century 21’s plans for Russia, and whether their success story can be repeated here.

Investment Risk Factors

  • January 01, 1970
The last six years have been a boon to all members of the Moscow commercial real estate community: brokers, consultants, investors and developers, perhaps all, save end-users who had to pay increasingly hefty rents for office, retail and warehouse space. Among the most interesting trends in the commercial real estate market has been the influx of foreign and Russian capital, which has brought capitalization rates for the best income-producing properties across all sectors down to single and low double digits, driving an increase in the market values of commercial properties.

Investment Funds

  • January 01, 1970
Residential and commercial real estate development is attracting more and more investors. If before only a small circle of professional developers were able to get their hands on promising sites, now, thanks to a system of tenders and auctions for distributing sites, more and more organizations that had never previously figured in this line of business are trying to get involved in property development. But in order to see a development project through from start to finish it is essential not only to have the financial resources, but also to work out properly the financing scheme for the project.

Revisions to Stakeholder Law

  • January 01, 1970
It’s now over a year since Federal Law No. 214 on stakeholder investment came into force. Just as market experts predicted, it never entered widespread practice in residential construction. Although for fairness’ sake it should be noted that there are two or three developers on the Moscow market who make a point of following the law to the letter, using this as a selling point in their advertising and even entering signed contracts with stakeholders in the State Realty Register, I would view this rather as the exception that proves the rule.

Going Up In Russia

  • January 01, 1970

Appointments

  • January 01, 1970

The Dubai Miracle

  • January 01, 1970
Persian Gulf economies — Bahrain, the United Arab Emirates, Kuwait, Oman, Qatar and Saudi Arabia — are booming. Especially strong is the trading performance of Dubai, which has transformed into one of the most influential world cities in less than a decade. Dubai manages huge investments at home and pursues landmark projects internationally. But certain inherent problems, if ignored, could spell an end to this economic miracle.

Stalinist High-Rise Living

  • January 01, 1970
Moscow’s national and international symbol is the Kremlin, with red stars glowing at night at the tip of each spire and the clock on the Spasskaya tower. But what it actually symbolizes is Russian statehood, Russia as a country. What, then, is the symbol of the city of Moscow itself?

Kazan Real Estate

  • January 01, 1970
One of the most important and most dynamically developing sectors of the economy of the Republic of Tatarstan is trade. The increase in the amount of retail space is above all the result of the growth in spending power of the local population and in the retail trade flow of the region. In terms of the speed at which the turnover of the retail trade has been growing in the last five years, Tatarstan comes second only to the Republic of Bashkortostan among the regions in the Volga Federal District. The turnover of the retail trade in Kazan continues to grow — in the five months from the beginning of 2006 it has grown by 31 percent over the same period in 2005.

Top Cottage Settlements

  • January 01, 1970
The Russian real estate market is still rightly regarded as unique in many respects, but there is one in which it is developing in line with international trends — as income levels grow, more and more people are trying to move away from densely built up urban areas and out into the country, or better still, to a waterfront.

New Cadastral System

  • January 01, 1970
As of January 1, St. Petersburg has adopted new procedures for the valuation of the sale price for freehold titles to land and determining the land tax rate, which is now calculated on the basis of the cadastral value of the land.

Architect in Chief

  • January 01, 1970
The spurt in construction, financed by investors taking a keen interest in the growth in the value of Moscow real estate, is changing the appearance of the capital very fast. Alexander Kuzmin, who became chief city architect back in 1996, admits that there are buildings in the city to which he gives a wide berth — that’s how much he dislikes them. But scattered mistakes have no impact on the positive view which Kuzmin takes of contemporary architecture in Moscow. He believes that London’s and Berlin’s stars are on the wane — and Moscow’s is on the rise.

Class-A Architecture

  • January 01, 1970
There’s no such thing as a Moscow style, say proponents of new construction in the historic centre. In other words, how can you complain that a building doesn’t fit in to its surroundings, when there’s no single point of reference? This was the problem that architect Nikolai Lyzlov faced, when he started work on Capital Group’s Pushkinsky Dom office center on Strastnoi Bulvar. The list of the architects who designed the neighboring buildings on this side of the street reads like a roll-call of famous Russian architects. But that is ipso facto an indication of the wide range of historical architectural styles that they embrace, from Matvei Kazakov’s and Osip Bove’s neo-classical Yekaterininskaya Free Hospital (1786-90 and 1825-28) at one end to Grigory Barkhin’s Constructivist Izvestia building (1925-27) at the opposite.