Interview with General Director of real estate developer and construction company Firms "TMM" - LLC (Kiev), Nikolai Tolmachev agency "Interfax-Ukraine".
Q: Mykola, can already speak about the improving situation on the Ukrainian real estate market?
Answer: We feel that residential real estate market stabilization occurred since the last six months to form a kind of supply and demand. In this case we are talking about demand and real sales.
Of course, we do not have to talk about the full "recovery" of the market - this is totally new to the state. Today, the requirements for the developer is much higher than they were before the crisis, and it is against the backdrop of significantly reduced prices. In particular, in Kiev, the U.S. dollar equivalent prices on average fell by half, while UAH - on some items, fell by 10-15%, according to others - the price has not changed. Demand fell somewhere in the 70%.
Q: What are your price expectations for next year?
Answer: Today we can talk about stabilizing the housing market. I think that the leading companies, "emerging" crisis, expects a good time. However, it is likely, in 2012, while in 2011, I guess, would be a smooth increase in sales. Despite the improved situation on the market, significant price hikes in the coming years will not be because there is no significant increase in income. The next year, may increase prices in the range of inflation - by 10-15%.
Today in Kiev the average price of 1 square. m of housing premium of $ 3-4 thousand, business class - $ 1,5-2,5 thousand, economy class - $ 1-1,5 thousand social housing - $ 700-1000.
However, it is worth noting a significant drop in housing supply, particularly if demand for housing fell somewhere in the 70%, the proposal - where some 80%. Nevertheless, the second "bubble" for a long time will not.
Q: Does the notion of seasonality of sales of real estate?
A: I do not believe in the seasonality of sales, as at today's real estate sales in the more influential than those seasonal factors - macroeconomic, social, political, etc.
In April this year an international crisis failed sales season, with July and August have shown growth.
Question: At what rate sales company TMM plans to enter next year?
Response: We note the demand for real estate companies, and we have already reached the hryvnia equivalent figure for 2007 sales. If in 2009 the whole real estate market has maintained a deep crisis in the current year for us as the developer has increased public confidence, and we have tripled our pre-sale.
By the end of 2010 we will reach a figure of real estate sales somewhere at 300 million USD, whereas in 2009 we received about 255 million USD in sales. And next year we plan to increase sales of approximately 1,5 times - up to 450 million USD. We have something to sell: we have to sell real property is valued at about $ 140 million
Q: Have there been any sale of a residence with a mortgage?
Answer: We have customers who buy a house through mortgage, as well as our program of home purchase in installments, but it's a small percentage of the total volume of transactions. In addition, we are now looking for banks that have lent to buy housing at acceptable interest rates. We already have a tentative agreement with one bank Lending purchase our homes at 12% pa in UAH, as 12% - is the threshold at which populations are able to service loans.
Question: Does "TMM" plans to implement the SPO and whether other loans next year?
A: We were ready this year already posted, but the market was not ready. I think that the placement of all companies operating in a segment of real estate, will approach next year. However, it will not go on massive investments of investors, and we do not expect a boom placement companies in construction, we are talking about investing in one or two proven successful company.
Percentage of shares to the placement is in the range of 15-30% due to the additional issue. However, while I'm not ready to name the amount planned to raise funds, as its size will depend on the price of the company, and from our objectives pursued, and this - increase the capitalization of the company, the beginning of construction of new facilities in order to avoid interruption in construction.
In addition, next year we plan to use all possible financial instruments - debt financing, project financing, under the new projects and considering the possibility of involvement within the EUR100 million, taking into account ability to service these debts from sales of those new projects, which involved funds .
Q: What plans does the company TMM Commissioning of housing for next year?
A: This year we will have a record for our company to deliver the real estate index in operation - about 130 thousand square meters. m. By the end of the year we plan to commission in Kiev, primarily housing and office complex Sonyachna Brama on the street. University, 73-79 (total area - 234 thousand square meters. M, including the first phase - 74 thousand square meters. M), in Kharkiv - a business class residential complex "Edelweiss" (the total area of 21 thousand square meters. m) ul.Olimpiyskoy and the first Green Town residential complex on the street. Ahsarova (total area - 25,6 thousand square meters. M, including the first line - 5 thousand square meters. M). Until this year, we went out to a maximum of commissioning at the level of 116 thousand square meters. m
In 2011, we have to go to index of new housing at a level of about 70 thousand square meters. m, in particular, we are talking about putting in Kiev, the second stage of complex Sonyachna Brama area of 44 thousand square meters. m, and two queues Green Town residential complex on the street. Ahsarova - about 20 thousand square meters. m
Q: Do you plan next year to start building new facilities?
Answer: Of course. In the spring of next year we plan to start construction in Kiev, 24-storey residential complex of premium-class trans. Laboratory, 7 total area 56 thousand square meters. m. (living area - 33,7 thousand square meters. m). At the same time we want to shorten the construction of the residential complex of 18 months instead of 31 months. In addition, we plan to begin construction of housing and office complex on the street. Panzer, 4-6.
In Kharkov, Zhitomir, and we will begin construction of new facilities solely on the clear understanding that one or the other house will be in demand and what people want to live it in him. In this case, in Kharkov, we will begin the second stage of premium residential complex "cascade".
In order to help us to offer our customers, we must start building new facilities or to take from the market pending facility and complete construction.