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.
