Japanese financial group Aruji will set up a fund worth 200 billion Japanese yen (over $1.85 billion) for investments in Russian real estate, the president of Aruji Gate Securities Inc. said.
"The registration of a fund for investment in Russian real estate, Aruji Real Estate Investment Fund, for operation over a five-year period (with an option to continue the term of its operation to 15 years) is at the concluding stage. The fund's shares/units will be offered to Japanese investors as early as July-August," Takuji Asaga said.
Takuji said the fund will be the first financial product in Japan aimed at raising capital for investment in the Russian property market.
Thursday, October 30, 2008
Sunday, October 19, 2008
Credit Squeeze Hitting Developers in St. Pete
As the worldwide financial crisis and its effect on project financing takes the luster off of Moscow's construction boom, St. Petersburg real estate developers are feeling a credit crunch of their own.
Teorema, a St. Petersburg-based developer, has frozen around $100 million worth of projects, said the company's chairman, Igor Vodopyanov. The projects were halted because of an inability to secure credit for their completion, he said.
"Right now, we're continuing to work on the Benua and Obukhovo Center projects so we can finish construction and get tenants as quickly as possible, but the rest of our projects are frozen," said Vodopyanov. "The situation won't change until banks start giving credit to developers. Right now, it's impossible to receive credit, even at the very highest rates."
Teorema's situation is not unique. As the crisis picks up steam, more and more banks are withholding credit from new clients, raising interest rates and demanding collateral on their loans.
Teorema, a St. Petersburg-based developer, has frozen around $100 million worth of projects, said the company's chairman, Igor Vodopyanov. The projects were halted because of an inability to secure credit for their completion, he said.
"Right now, we're continuing to work on the Benua and Obukhovo Center projects so we can finish construction and get tenants as quickly as possible, but the rest of our projects are frozen," said Vodopyanov. "The situation won't change until banks start giving credit to developers. Right now, it's impossible to receive credit, even at the very highest rates."
Teorema's situation is not unique. As the crisis picks up steam, more and more banks are withholding credit from new clients, raising interest rates and demanding collateral on their loans.
Monday, October 13, 2008
Russian real estate market may plunge 25%
A sharp slump of the Russian real estate market may well occur in near future, representatives of Mirax Group, the Russian leading developer, said yesterday. However, the developers believe they can stand a short-term 25% drop of prices.
Mirax Group’s recipe to survive under crisis conditions is no to take loans and freeze the major part of projects. The company’s profits are still quite high - $170-190 million, while manufacturing expenses do not exceed $120 million.
Long-term the company is likely to face serious problems, since the number of men of means capable of purchasing real estate may decrease.
Mirax Group’s recipe to survive under crisis conditions is no to take loans and freeze the major part of projects. The company’s profits are still quite high - $170-190 million, while manufacturing expenses do not exceed $120 million.
Long-term the company is likely to face serious problems, since the number of men of means capable of purchasing real estate may decrease.
Tuesday, October 7, 2008
Sistema-Hals Tumbles on Russian Real-Estate Liquidity Concerns
Oct. 1 (Bloomberg) -- Sistema-Hals, the property company of billionaire Vladimir Yevtushenkov, lost half of its value in London trading on concern real-estate companies may run out of funds to finance projects amid falling property prices in Russia.
Sistema-Hals global depositary receipts fell to 50 cents from $1 yesterday in London at of 12:40 p.m. U.K. time, the lowest since the GDRs began trading in November 2006.
Fitch Ratings in a conference call today said Russian developers must slow their growth or sell stakes because of liquidity problems.
Moscow's decade-long building boom is falling victim to the global credit crunch as record high interest rates squeeze developers in the world's third-most expensive property market.
Sistema-Hals global depositary receipts fell to 50 cents from $1 yesterday in London at of 12:40 p.m. U.K. time, the lowest since the GDRs began trading in November 2006.
Fitch Ratings in a conference call today said Russian developers must slow their growth or sell stakes because of liquidity problems.
Moscow's decade-long building boom is falling victim to the global credit crunch as record high interest rates squeeze developers in the world's third-most expensive property market.
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