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. Last Updated: 07/27/2016

Petersburg Hotel Fights City Hall

ST. PETERSBURG — The Federal Anti-Monopoly Service’s branch in St. Petersburg has come to the defense of a small hotel on land that City Hall approved for a shopping center.

In 2007, the city gave developer Donk rights to build a mall on land that has been occupied since 1998 by the minihotel.

Handing over the land without a tender violated the law on competition, especially since hotel owner Metkon has sought to build a new hotel there since 2001, the service said.

Metkon invested $3 million in its three-star Hotel M-11, CEO Irina Zavyalova said. The rental agreement expired in 2006, but when Metkon submitted its investment program to build a 160-room hotel in May, it was extended indefinitely, she said.

The city’s building committee said it had not seen the service’s instructions, but that in some cases the city has the right to offer land without a tender. Another city committee has sued to have Metkon removed and a court hearing will be held Oct. 14.

Donk CEO Konstantin Pankratyev said Metkon’s buildings and activity were illegal, and Donk and St. Petersburg would contest the anti-monopoly service’s ruling.