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. Last Updated: 07/27/2016

St. Pete Plans Sale of Over 40 Large Plots

ST. PETERSBURG -- St. Petersburg city government plans to auction off over 40 large plots of land in several of the city's districts starting January.

City officials expect investors to redevelop the territories, replacing dilapidated buildings with new ones. Under a bill approved Sept. 18, residents of demolished buildings will stand to receive new apartments, to be paid for by real estate investment companies.

"We will observe the rights of every person. All families without exception will receive improved living conditions, moving to new and comfortable apartments," St. Petersburg Governor Valentina Matviyenko said Tuesday.

City officials said the redevelopment of residential districts would solve two problems: Local residents will receive improved housing, while construction companies will be able to build new developments on the vacant land plots, which are currently lacking in the city.

City Hall expects investors to provide residents of the demolished buildings with accommodation equivalent in size, if not larger, than their previous homes in apartment buildings in the same district. Alternatively, homeowners are eligible for compensation equal to the market value of their original apartment. Deputies listed 44 plots -- including land in the Nevsky, Krasnogvardeisky, Admiralteisky, Frunzensky, Kalininsky, Moskovsky, Kirovsky, Kolpinsky, Krasnoselsky, Kronshtadtsky, Kurortny and Petrodvortsovy districts -- due for renovation.

"If this initiative is undertaken, it will be the best solution for dilapidated buildings. We doubt whether investors will be interested in all of these plots, however," said Irina Khondozhko, deputy head of the residential real estate department at Central Real Estate Agency.

"Resettling the residents of just one building could take two years and eat up considerable financial resources," she said. Khondozhko suggested that plots in the Moskovsky, Frunzensky and Kalininsky districts would be in highest demand. Because of additional expenses, the prices of apartments in new buildings could be 10 percent to 15 percent higher than normal market prices for similar premises, she said.

"Renovation may be profitable only in the districts that are not densely populated -- in the districts where investors are able to construct more buildings than they demolish," said Yevgeny Kaplan, deputy director of a St. Petersburg-based association of construction companies.

Kaplan said the requirement to provide people with new apartments in the same district was fair but economically unfeasible.

Apartments costing $1,500 per square meter on the city's outskirts could cost as much as $3,000 per square meter in central areas of the city, Kaplan said.