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. Last Updated: 07/27/2016

Ukraina Sets $200M Reconstruction

The Ukraina Hotel, one of seven Gothic Stalin towers that shape the city's skyline, is slated to undergo a sweeping reconstruction that would turn it into a four-star hotel with everything from modern amenities to its own helicopter launch pad.

"It will be very convincing," said Boris Linichenko, general director of Ukraina.

The Kommersant Daily newspaper reported that the project would bear a price tag of $180 million to $200 million.

Financing for the two-year modernization program, the paper said, will be arranged by Hotel Service Management (Switzerland) Ltd., an Irish-registered company.

Linichenko, while offering few details of the project, confirmed the main points reported in Kommersant.

If the plan goes ahead, the hotel will close for eight months during the two-year, two-stage reconstruction project, and during that period the building's engineering infrastructure is slated to be overhauled and its central section redesigned. The result will be a more modern and competitive hotel, Linichenko said, with the number of rooms scaled down from 1,016 to 800. The more spacious new suites will also be more expensive, at $170 to $180 a day, compared to the current average of $70.

The redesigned hotel is set to include a business center and a fitness club with a swimming pool and tennis courts, as well as a 25,000 square meter shopping center. The pi?ce de r?sistance will be a helicopter landing pad that will receive seven-minute-long flights from Sheremetyevo International Airport.

One floor of the hotel will retrain a retro look: "We want to combine the hotel's style of the 1950s -- its old-style furniture and original paintings -- with the most modern amenities," said Linichenko, who was the general director of the Kosmos Hotel before moving to the Ukraina a year ago.

Kommersant Daily reported that the Moscow city government, which owns the Ukraina, is set to pass a resolution by the end of this year to set up a joint-stock company, AO Hotel Ukraina, which would assign a 100 percent stake of the hotel property and building to the city.

Hotel Service Management (Switzerland) Ltd. will attract investment, and, in return, foreign investors will receive shares in the company as part of a supplementary share issue. The city will retain a controlling stake.

Linichenko declined to provide details about the project's financing or provide contact information on the Hotel Service Management (Switzerland) Ltd. Although an address for the company is listed in a Dublin commercial registry, the registry had no phone number for the company, nor did local directory assistance.

Two Moscow hotel industry watchers said they had not heard of Hotel Service Management (Switzerland) Ltd.

But a $200 million renovation price tag, one analyst said, sounded realistic for the Ukraina. The walls in such a Stalin structure are thick, and in order to increase room sizes enough to make them attractive at four-star hotel prices, he said, a lot of walls will have to be knocked out.

"Those walls won't move easily," he said.

Another hotel industry watcher, Andrei Alexeyev of the magazine Turinfo, was skeptical of plans to reconstruct the Ukraina. Renovation plans have been announced for city-owned hotels including the Moskva, Rossia and Intourist, as well as a hotel at Sokolniki with a promised delivery date of September. "They've completely fallen through," he said.

The project's developer is currently being decided, Linichenko said. He added that hotel officials have visited a number of countries in order to select a contractor.