Unfinished - it's a vicious circle

26.09.2010 08:19
Articles about real estate | Unfinished - it On the example of "Regional Investment and Construction Company (earch), one of the main developers of Balashikha near Moscow, one can follow the sequence of actions and events that will inevitably stop the construction. Says CEO earch and the Moscow real estate agency, vice-president of the Moscow Association of Realtors Sergei Jew.

- What is the biggest challenge of building now? Why is growing army of defrauded real estate investors and why slowed construction?
- Our awesome, has not yet invested in this country offers an almost unlimited field for the investors. But, unfortunately, it is our construction industry is most vulnerable. Where is her Achilles heel? It is based on the investment contracts, in which local officials can include anything you like - by the conclusion ADDITIONAL AGREEMENT. In fact, housing construction and, more importantly, its value is directly dependent on the state of municipal infrastructure and the position of the heads of administrations that burden developers.

Related article: 35% of Kiev's unfinished projects are at the initial stages of construction

In 2003, we signed an investment contract in a Moscow Balashikha on construction of 200 thousand square meters. m of housing. But then we did not know that we will have to invest much more than was specified in the document. Gradually to the items on the construction of housing were added construction of the main communications, schools, kindergartens and other facilities.

- How is the increased cost of construction?

- The cost of homes was 1.715 billion rubles. Erection of engineering networks and facilities, as well as delays in issuing documents, which have entailed the payment of additional interest on bank loans, have added to this figure has almost 1.1 billion rubles. Thus, the project became more than 63% more expensive.

- And how did this happen? The opinion of the developer taken into account in this rise in price?

- Additional burdens were born in the voluntary-compulsory. For example, our luck bolshegruz building materials to the construction site. Partitions off the road police cordon. Hour stand, second, for us - many kilometers tube. Point a finger at us as the perpetrators of violence. Trying to figure out what was going on - it turns out that we miss, but after the arrival of the administration. And there we are waiting with ready documents on additional burdens. As a result, the cost of the project amounted to 2.799 billion rubles., Projected revenue - total 2.317 billion

- That is, revenues were lower than the costs? What do you do?

- When it became clear that our cost part can greatly exceed the revenues, we have raised the question about the status of our project at the field. Then there was an additional agreement under which we received a new compensation area, and in the documents first arose definition of a "single investment project."

- It turns out that the authorities do not always create obstacles ...

- It would seem so. However, the declaration in the documents does not intersect with the real goodwill. More than one year left on it to get city leaders to issue technical specifications for this compensation area. In late 2008 they were finally issued. But these documents have been ... new burdens! Now we were instructed to shift the sewer regional significance - just quote the example that you understand the scale of the disaster. Were raised and several smaller tasks.

Amounts that, according to the administration, we had to spend on something to upgrade the communal system of the city, exceeded 500 million rubles. And that's not counting the fact that the size of the already executed encumbrances on the design and construction of engineering networks and communications, as well as objects welfare projects totaled about 650 million rubles.

It took almost another year of tremendous efforts, not only ours, but also equity holders of construction, which more than a year waiting for their apartments, to from the technical conditions have removed all the obvious disparity. I'm not talking about the fact that the other permits have been issued with a delay of several months and under pressure.

- From the project so easy not to leave, and with the administration, it turns out, have to agree, right?
- Yes, the money already spent from the project just will not come out. And without proper signatures of the local authorities for construction of the law can not be maintained. Vicious circle.

- A appeal to higher authorities would not help resolve the situation?

- Most of our complaints to the appropriate authorities went unanswered. Some time been able to cope with the situation due to the growing market. Latali hole by increasing the cost per square meter, took credit. With enormous effort put into operation the first six houses.

- That is part of the project managed to pass no matter what?

- Yes. Today, residents of those homes - happy owners of quality housing and furnished house territories. They were pleased to note that such neighborhoods throughout the suburbs - a rarity. By the way, it indirectly recognize the leaders and the city administration, because reports on the work regularly includes photographs of the district, we have built in spite of all administrative obstacles.

However, when prices are frozen, and then went down, patching holes has become nothing. Since the prolonged investment project has left many real estate investors without planned for this year's Housewarming.

Today in Balashikha are all building. But it is not in crisis, and I'm sure of it. The crisis has only highlighted the underlying cause of the ruin of developers: the exorbitant demands of administration. And so not only in Balashikha, but in most regions of Russia.

- Is there a remedy against arbitrary action by bureaucrats and run a construction site?

- Do these problems is too long "tail." It should be easy to cut.

First: you need to create an interagency committee to review investment contracts - absolutely everyone in the whole country. This is a big job, but start doing it is because in the present circumstances to do what is written in the investment contracts is not possible.

- As far as I know, this work is already underway.

- Yes, but everything is done, so to speak, by hand and very slowly. Expended tremendous efforts of the Government and State Duma deputies, and a working group to address defrauded real estate investors. And if you translate this car from manual to automatic control, it can be not only to deal with all problems defrauded real estate investors, but also re-launch the mechanism of housing construction. And it will be a natural process that quickly picks up the pace.

The second step in this direction should be to create a public utility infrastructure.

- The topic of state corporations has acquired a negative connotation, and for tariffs on utilities are already flying head.
- Yes, indeed, some of these structures decided to liquidate, and in some cases it is justified. Still, one such organization, in my opinion, you must create. I'm talking about the state corporation to provide the infrastructure facilities of concern. The state should take the trouble to build the very "communal", which is currently imposed on builders as encumbrances.

- And then, as is assumed in the creation of the fund RZHS ready platform will offer at auction the investor-builder?

- Exactly. It would be reasonable and fair. For commercially viable facilities developers will lay out large sums of money that will be compensated by costs. Yes, in areas less attractive to obtain comparable amounts do not succeed, and perhaps even the cost will not be repaid, but will develop the territory. And it is no less important than the money. This investment in their own country in its development. And most importantly, by itself will no longer corrupt component. All developers, I think, will support me.

In the meantime, the Fund RZHS at his own expense on the sites demolition of dilapidated facilities, but the duty on the construction of utilities continues to lie at the local government and developers who wins the auction stock. And this bunch, as we traced earlier, initially flawed.

- There is one issue that constantly told leaders of the country: the lack of construction lending.
- Yes, many construction projects rose from the very moment when stopped lending. And the question of its renewal must be addressed as quickly as possible. And where to get the money? The main thing - do not try to reinvent the wheel. Worldwide in construction loans are used long-term money, such as pension funds. And do not be afraid of that large injections into the industry dispersed inflation. Money invested in housing, do not contribute to inflation, but primarily by raising living standards.

- So, first of all you have to invest in construction?

- Yes, because it will be grateful attachment, it is checked on the experience of other countries. Both America and Europe in times of financial turmoil overcame them with shelter.

The construction industry is able to pull the whole train off the rails of the economy. Indeed, one job in construction creates more than a decade in related industries. What does this mean? Employment, steady income - and, consequently, an increase in consumer demand.

- Mortgage as an instrument of revival building, in your opinion, is efficient?
- Certainly. Lending to the population to buy housing will significantly increase consumer demand, and hence stimulate developers to build bigger and better.
Content tags: New buildings
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