Feds Make Real Estate Auction Rules

The government intends to impose controls on the modernization and reconstruction by private investors of federal real estate managed by federal state unitary enterprises and the subsequent privatization of those properties. Russian Prime Minister Mikhail Fradkov signed a resolution last week requiring that any transaction with federal real estate worth more than 150 million rubles be competitive and subject to the approval of the government. Capital investments over 500 million rubles in federal real estate will also require the government's permission.

Real estate prices soar in Sochi

Real estate is selling like hot cakes in Sochi, where prices have been growing annually by 20%-30% in the last few years. Unlike local residents, who buy housing seldom and cheaply, rich Russians from Moscow, St. Petersburg and the country's oil-bearing provinces view real estate on the Black Sea coast as good investment. Before the IOC chose the venue among three candidates - Sochi (Russia), Salzburg (Austria) and PyeongChang (South Korea) - one hectare (2.5 acres) of land in Sochi cost approximately $10 million, and flats were sold at $3,000 per square meter in block houses and $7,000-$8,000 in elite housing.

Vester To Sell Real Estate

Russia - Retail major Vester Group is set to sell its non-core assets and trading centres, estimated at over $150m. According to local reports, Vester has recently sold its Avicenna pharmacy chain in Kaliningrad for $1.0m, and a trading centre for $15m. The reports said Vester plan to use the proceeds as investment to attain its stated objective of touching $2.2bn in turnover by late 2008. Vester had announced the sale of non-core assets earlier this year. Other retail assets include the Knigi & Knizhechki booksellers (10 outlets), the Monte Cristo jewellery chain (19 outlets), several furniture and sports shops and an electric appliance retail chain.

The Moscow region's warehousing market keeps struggling

In recent months the market has witnessed a new wave of interest on the part of investors and developers as they seek to grab a slice in what looks as one of the most promising real estate niches in Moscow and its surroundings in many years to come.
Norway's Eastern Property fund has raised $350 million it plans to invest into Russian real estate. The funds will be used to acquire six office buildings, two shopping centers and two warehouses in the next 12 months. "Triple net rental rates for Class A warehouse facilities are estimated at $115-135 per square meter per year, and for class B - $100-125 per square meter per year," Maxim Shakirov, Warehouse and Industrial Dept. director at Colliers International told The Moscow News.