17 Jul '08
Moscow-based development company RuDevelopment, a subsidiary of Oleg Deripaska’s business, has announced over $800m worth of plans to invest in construction of both residential and business premises in the city of Krasnodar with further expansion into the region. Deripaska’s company is expecting big projects in the region’s real estate sector, each surpassing $390m.
RuDevelopment was founded in 2007 by Russian-Asian Investment Company (RAINKO) that operates Deripaska’s secondary businesses in the Krasnodar Region and Moscow. RuDevelopment was established specifically for the needs of future development projects in Krasnodar. Presently, the company is gearing up for a $483m project aimed at constructing two business centers and a hotel in the city.
But first the company has to pay a “fee” for entering the Krasnodar real estate market. This $157m “charge,” as estimated by experts, stems from a deal signed with Krasnodar city authorities, which compels the developer to complete housing construction to atone for the loss incurred by individual investors deceived by their development company Stroyintercomplex.
Experts emphasize, however, that in the long run RuDevelopment will still be able to gain, as in a gesture of gratitude for the firm’s “charity” the Krasnodar administration will support all of the company’s commercial projects in the city.
The company CEO Andrey Lukiyanov has publicly announced that RuDevelopment has recruited for all the big future endeavors Barcelona’s chief architect Josep Acebill. Earlier Acebill was contracted by Kazan’s authorities to develop a concept for the city’s city center redevelopment.
The first $319m business center with a 200,000 square meter floor space will be built in downtown Krasnodar. Around 40,000–50,000 square meters will be used for underground parking areas. Shopping premises and apartments will take another 50,000 square meters of premises.
But for the most part the business center will accommodate class A offices, including one of Oleg Deripaska’s companies that have interests in the Krasnodar Region, Lukiyanov explains.
Another $32m administrative and business center is to be built on the Kuban River embankment on a 0.25-hectare site.
Simultaneously, the company will build a five-star 17-storey hotel on a one-hectare site near Gorky Park. The hotel, which is to cover almost 60,000 square meters complete with underground parking, will have approximately 200 rooms, a business center, and even separate residential areas. Investment in the project is estimated at $160m. Currently the company is in talks with Hyatt International, which may be chosen to manage the hotel.
All the planned projects are scheduled for completion in 2012–2013.
RuDevelopment also has other projects in Krasnodar, which are all in their inception, including reconstruction of a whole city quarter or construction of an administrative and hotel complex. A total amount of investment in these projects to be managed by RuDevelopment itself may come up to additional $99m.
RuDevelopment’s portfolio includes more than 100 ha of sites in Krasnodar, Sochi and Anapa, both in the firm’s possession or likely to become such. A bunch of low-rise residential buildings and commercial, sports and entertainment facilities will be spawned there in future.
These and other projects of the company are part of its development strategy that aims at comprehensive development of vast territories surrounding key cities of the Black Sea coast.
To carry out all of its tremendous projects, RuDevelopment plans to use both own funds and loans.
Russian-Asian Investment Company (RAINKO) was founded in 2005 to provide consulting services to businesses operating in various sectors – from aircraft manufacturing, agriculture and development to textile manufacturing, distribution of printed materials and venture investment. At present it runs a number of subsidies, including agroholding Kuban, printing agency Rospechat, Vuokatti-Rus and RuDevelopment, to name but a few.
RuDevelopment is a management company established to run RAINKO’s development projects in Krasnodar, its region, and other Russian regions. Currently the company’s portfolio includes over a dozen of land sites and real estate premises.