Bi-weekly News Briefing Russian Construction Revie · Russian Construction Review PMR Publications...

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Published by PMR Publications Bi-weekly News Briefing A prime source of market intelligence for construction professionals www.constructionrussia.com Russian Construction Review PMR Publications (www.pmrpublications.com) is a division of PMR, a publishing, consulting and market research company providing market information, advice and services to international businesses interested in Central and Eastern European countries as well as other emerging markets. With highly skilled staff, top ranked web sites and over 13 years of experience, PMR is one of the largest companies of its type in the region. PMR IMPORTANT NOTICE: is is a free sample newsletter. Feel free to forward it to anybody in or outside your company to whom it might be of use. If you wish to reproduce the contents of this publication, you should first request permission from PMR Publications (www.pmrpublications.com) giving details of what will be quoted and where.

Transcript of Bi-weekly News Briefing Russian Construction Revie · Russian Construction Review PMR Publications...

Published by PMR PublicationsBi-weekly News Briefing

A prime source of market intelligence for construction professionals www.constructionrussia.com

Russian Construction Review

PMR Publications (www.pmrpublications.com) is a division of PMR, a publishing, consulting and market research company providing market information, advice and services to international businesses interested in Central and Eastern European countries as well as other emerging markets. With highly skilled staff, top ranked web sites and over 13 years of experience, PMR is one of the largest companies of its type in the region. PMR

IMPORTANT NOTICE:

This is a free sample newsletter. Feel free to forward it to anybody in or outside your company to whom it might be of use.If you wish to reproduce the contents of this publication, you should first request permission from PMR Publications (www.pmrpublications.com) giving details of what will be quoted and where.

Published by PMR Publications

Issue No. 16 (77) – Tuesday, 4 August 2009Bi-weekly News Briefing

A prime source of market intelligence for construction professionals www.constructionrussia.com

Russian Construction Review

PMR Publications (www.pmrpublications.com) is a division of PMR, a publishing, consulting and market research company providing market information, advice and services to international businesses interested in Central and Eastern European countries as well as other emerging markets. With highly skilled staff, top ranked web sites and over 13 years of experience, PMR is one of the largest companies of its type in the region.

Industry news� page�2

Construction market

Russian government to fund Winter Olympics

Contractors and developers

Vinci to invest more in RussiaOnexim to sue OPIN for spinning off assetsVneshTorgBank wins case against GlavstroyAlpha Group becomes Mirax’s largest creditor

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Building materials

LSR abandons construction of new cement plantPervy Stroitelny Fond launches brick plantKnauf reschedules investment in RussiaVEB to invest €139m in cement plant

Look�inside�for�more�news�on�this�category��u

Real estate

Teorema sells assetsOPK loses Rublyovka landCity to sell its stake in TSUM department storeSt. Petersburg authorities request 14% discount from participant in land auction

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Planned investments

Residential and mixed-use

Matrix Corporation invests in Leningrad ProvinceLSR Group wins contract for social housing in St. PetersburgSevernaya Korona to be demolishedSberbank sets aside €640m for residential housing

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Non-residential

Construction of Parliament buildings on site of Krasnaya Presnya put on holdSuzuki abandons plan to build factory in Leningrad ProvinceChizevskoye Podvorie to be sold to VTBC-DB Real Estate PartnersEastfield Logistics suspends project in Krasnodar

Civil engineering

Avtodor – first tenders in August 2009Pushkinskaya Square and Tverskaya Zastava to be rebuiltConstruction of toll road between St. Petersburg and Moscow to start next yearGlavnaya Doroga signs concession contract for MKAD-M1 junction

Look�inside�for�more�news�on�this�category��u

Ukraine

MinTrans in search for investor for a new terminal at the Lviv airportHighest skyscraper in Ukraine to go up in DnipropetrovskResidential construction declines by 32% in Q1 2009Construction of Mall of Ukraine postponed

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In brief

Market overview & statistics� page�10

Current status of Ukraine building materials marketBasic economic and construction industry indicatorsConstruction outputHousing constructionFederal subjects of Russia

Upcoming events� page�18

PMR

Russian Construction Review – Issue No. 16 (77)Tuesday, 4 August 2009

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Vinci to invest more in Russia

Europe’s largest construction company, the French concern Vinci, is considering sever-al investment projects in Stavropol Territory. The Ministry of Regional Development has offered the company, the opportunity to in-vest in the recycling of hard domestic waste, the development of spa resorts, as well as the

development of Stavropol airport and toll roads in the region.

Onexim to sue OPIN for spinning off assets

The development company Open Investments (OPIN) has sold some of its property assets

in order to finance its operational activities and to deal with existing debt. This includes the sale of the Meyerhold business and ho-tel centre in Moscow, the Pavlovo Podvorie shopping and recreation centre and several other sites in the provinces which have led to a dispute with Onexim, one of the company’s main stakeholders.

In an official statement Onexim explained that it had heard of this from the media and that none of these deals had been agreed with the company. In addition, it stated that there were no grounds for such a move and that OPIN had attempted to withdraw assets from the business illegally. Onexim warned that, if necessary, it would use legal means to chal-lenge these transactions.

Companies in this issue:

AKB Eurofinance Mosnarbank� page 5Alpha Group� page 3Auchan� page 8Avtodor� page 6Baltros Group� page 4BaselCement-Pikalevo� page 4Binbank� page 5Brambati Group� page 7Coalco� page 3C.O.M.INT srl� page 7Dalpiterstroy� page 4DEOL Partners Company� page 8Dolnik & Co� page 7Eastfield Logistics� page 6Eurocement Group� page 4GDSK� page 5Glavnaya Doroga� page 7

Glavstroy� page 3GVSU Tsentr� page 3Knauf� page 3LenspetsSMU� page 4Likolor� page 3LSR Group� page 3, 5M-Industria� page 5Matrix Corporation� page 5Mercury� page 4Mirax Group� page 3Moskonversprom� page 5N.P.M. Hospital� page 7Olimpstroy� page 2, 6Onexim� page 2, 3Open Investments� page 2Pervy Stroitelny Fond� page 3Renova StroyGroup� page 3

RIGroup� page 3Sberbank� page 5, 6Sibirsky Cement� page 4Stroyinvest� page 3SUAL� page 4Tebodin Ukraine� page 7Teorema� page 4Torgovy Dom TSUM� page 4United Industrial Corporation� page 4Uralskie Stroitelnye Smesi� page 4Vinci� page 2Vnesheconombank� page 4VneshTorgBank� page 3VTBC-DB Real Estate Partners� page 6XXI Century� page 8

Russian government to fund Winter Olympics

The Russian Prime Minister Vladimir Putin has signed a decree to release €2.2bn to the government corporation, Olimpstroy, and

over €157m to the Olympic committee to build the Winter Olympic venues in Sochi between 2010 and 2014. The government’s total investment for this purpose will amount to €3.8bn between 2008 and 2014.

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Market news

Industry news

Contractors and developers

Tuesday, 4 August 2009Russian Construction Review – Issue No. 16 (77)

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LSR abandons construction of new cement plant

The LSR Group has abandoned a plan to build a ferroconcrete structure plant in Metallostroy, in Leningrad Province. The group obtained a 15.5-ha site from the St. Petersburg authorities, but the asset might be withdrawn, as the group is no longer in-terested in the construction because of the slump in demand. LSR has five other plants

of this kind in the region, with a total capac-ity of half a million m3, and at the moment this is enough to meet existing demand.

Pervy Stroitelny Fond launches brick plant

At the end of July Pervy Stroitelny Fond acti-vated a new brick factory in Novosibirsk. The

Likolor factory cost over €44.8m and has an annual capacity of 63 million ceramic bricks. 40% of the output will be sold, whereas 60% will be used by the company in its residential projects. Production lines may also be used to produce decorative and paving tiles.

Knauf reschedules investment in Russia

Knauf has rescheduled the launch of a plas-terboard sheet factory in Russia from this year to 2011. The Irkutsk project is thought to be worth €110m. The plant will have an annual capacity of 60 million plasterboard sheets, which will be supplied mostly to the Siberian and Far-Eastern federal districts, ac-cording to Kommersant.

According to OPIN, the proceeds of these deals, the equivalent of €174m, were neces-sary to finance its operating activities and to deal with existing debt, which stood at €590m at the time.

OPIN was established by Interros, a ma-jor Russian private investment company, in the autumn of 2002. Around 30% of OPIN belongs to the Onexim Holding, owned by Mikhail Prokhorov, whereas Interros owns a stake of 40.9% in total.

VneshTorgBank wins case against Glavstroy

VneshTorgBank has obtained a court ruling which obliges Glavstroy to repay a €45m debt which was due at the end of last year. The de-veloper received a loan from the bank at the beginning of 2008; the debt was to have been repaid with money raised through a bonds is-sue. However, the bonds were never issued.

VneshTorgBank is the third Glavstroy cred-itor to have a court ruling in its favour on loan non-repayment. Alpha bank and Nomos bank had, earlier, obtained court rulings for €11m and €22m respectively. Glavstroy is ne-gotiating on debt restructuring with all three creditors.

Alpha Group becomes Mirax’s largest creditor

The Alpha Group has acquired €154m of the Mirax Group’s delinquent debt from Credit Suisse at a 60% discount. The loan was secured by shares in an undisclosed Dutch-registered company, which owns, through Mirax-Citi, rights to the Federation Tower office centre in Moscow City. The group has expressed the opinion that Alpha’s move was “hostile”, according to a report in Kommersant. As a result of the transaction Alpha has become the largest Mirax creditor, with total claims worth €231m.

Subsidiary of Coalco petitions for bankruptcy of RIGroup

GVSU Tsentr, which is affiliated with Coalco, has initiated legal action in pursuit of the bankruptcy of Stroyinvest - a subsidi-ary of a development company, the RIGroup. The claim was registered on 24 July before the Moscow Arbitration Court. In May, another action, for €5.3m, was brought against Stroyinvest by VTB Bank, as well as by Svyaz-bank and the authorities of the

city of Serpukhov (in Moscow Province). According to Ria Novosti, the overall debt of the RIGroup stands at €675,000.

LSR Group reports on Q2

The LSR Group reported an unconsolidated net profit of €14.2m in the second quarter of the year. In Q1 2009 the group made a net loss of €11.7m. In H1 2009 the LSR Group’s net profit therefore came to €2.4m, 22.8% less (in rouble terms) than that of last year.

Renova StroyGroup in talks with regional developers

Renova StroyGroup is in talks with region-al developers in Yekaterinburg, Chelyabinsk, Perm, Krasnodar and the Moscow Province on the purchase of unfinished or suspended construction projects, according to a report in Kommersant. The company hopes to ob-tain these at a discount and complete them under its own steam.

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Building materials

Russian Construction Review – Issue No. 16 (77)Tuesday, 4 August 2009

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VEB to invest €139m in cement plant

Vnesheconombank (VEB) has provided a €139m loan for the construction of a large cement plant in Penza Province. The plant will use an energy-efficient “dry” manufac-turing process. Today in Russia around 80% of cement plants still use the traditional “wet” process for cement production.

BaselCement-Pikalevo obliged to pay €782,000

The Moscow Arbitration Court has ruled partially in favour of the Eurocement Group in its action against BaselCement-Pikalevo

and SUAL. The court decision obliges the respondents to pay €782,000 for halting the supply of raw materials - belite slurry – to the Pikalevsky Cement plant in August 2008. BaselCement-Pikalevo is about to appeal against the court’s decision. When the ini-tial action was brought before the court in December 2009, the compensation claimed was €1.2m, but this was later reduced to €1.14m.

Reduction in Sibirsky Cement production output

Sibirsky Cement, the second largest cement manufacturer in Russia, has announced a year-on-year fall of 38.2% in production

volumes in H1 2009. During the period in question the company produced 1.26 mil-lion tonnes of cement at its three factories: Tokinsky Cement, Krasnoyarsky Cement and Tyumlyuysky Cementny Zavod.

Uralskie Stroitelnye Smesi invests in Sverdlovsk Province

Uralskie Stroitelnye Smesi, a manufactur-er of dry building mixes under the Bergauf name, is to launch a new factory in Sverdlovsk Province in Q2 2010. This will have an annu-al capacity of 300,000 tonnes. It is estimated that the investment cost will be €15m.

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Teorema sells assets

The Teorema holding, active on the St. Petersburg market, has admitted to hav-ing sold almost all of its assets, including the EvrikA, T4, Langenzipen, Obukhov-Tsnentr and Benoit business centres. The investor is a certain Akkumax.ru, owned by an off-shore company, according to a report in Kommersant. The centres were pledged as security for the holding’s CLNs, but its ma-jor stakeholder, Igor Vodopianov, claims that the noteholders agreed to the sale of the as-sets. At the same time a number of informed sources have speculated that the new owner of the assets may be associated with Teorema, although the holding denies this.

OPK loses Rublyovka land

The United Industrial Corporation (OPK), which belongs to Sergey Pugachev, has transferred property rights to a Moscow stud farm and adjoining land near the Rublelvo-Uspenskoye highway, a prestig-ious area of Moscow Province, to VTB24

bank because of money owed. These terri-tories were pledged as security to the bank for a €1.7bn loan at €13,800 per 100 m2. The transfer of 12,000 ha of land to the bank took place at the same price. The land is intended for the construction of 1 million m2 of luxu-ry residential housing. Although it no longer owns the land, the OPK will, nevertheless, be able to participate in the project as a devel-oper: this has already been agreed between the partners.

According to an official OPK statement, the sale, to VTB24, of the companies to which the pledged land belonged was totally legitimate. However, the legal status of some parts of the transferred land remains unclear because of an ongoing court assessment of 374 ha of the land of the Leninsky Luch collective farm, the occupants of which claim that the land was sold to the OPK in 2002-2003 without their knowledge.

City to sell its stake in TSUM department store

The Moscow authorities are to sell 7,100 m2 of TSUM – a centrally-located department

store in Moscow. The city obtained the 6th and 7th floors in accordance with a contract with Torgovy Dom TSUM pertaining to the con-struction of the second stage of the TSUM building in 2008. It tried to sell the asset to the luxury retailer Mercury, which controls the rest of the store, at €12,000 per m2, but Mercury, which had an option to buy this area in accordance with the investment con-tract, refused to buy the asset at such a price.

Now when the investment contract is closed, the city can sell the premises only through an auction. The price is expected to be significantly lower – €5,400 per m2 at most. Although Mercury has not commented on its plans for the asset, it is believed that the company will try to buy the premises.

St. Petersburg authorities request 14% discount from participant in land auctionOf three companies which initially applied to participate in an auction on the sale of land to the city of St. Petersburg pertaining to the construction of 140 m2 of housing, only the application of the Baltros Group was accept-ed. Applications from two other companies, LenspetsSMU and Dalpiterstroy, were re-jected because of their non-compliance with the auction rules.

The Baltros Group put up for sale a 20-ha site near the southern city limits of St. Petersburg, in the Pushkin district. The initial auction price was set on 19 July at

Real estate

Tuesday, 4 August 2009Russian Construction Review – Issue No. 16 (77)

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Residential and mixed-use

Matrix Corporation invests in Leningrad Province

The Matrix Corporation intends to put up a residential settlement on the shore of lake Ladoga, close to St. Petersburg, at an estimat-ed cost of €11.2m. This will include 250 hous-es located on an area of 58 ha. Construction work is due to start in September this year and end in 2012.

LSR Group wins contract for social housing in St. Petersburg

The LSR Group is planning to sell more than 1,000 flats to the St. Petersburg authori-ties after prevailing in a tender for the sup-ply of social housing to the city through its GDSK subsidiary. The tender’s starting price was €1,074 per m2, whereas the average econ-omy-class price was €1,415 per m2. The de-veloper was the only applicant for four sites containing 1,040 flats and worth €41m, ac-cording to Vedomosti. The tender conditions permit the signing of a contract with a single applicant.

Severnaya Korona to be demolished

AKB Eurofinance Mosnarbank is to demol-ish the unfinished Severnaya Korona hotel in

St. Petersburg and replace it with a residen-tial district.

Construction of the hotel began almost 20 years ago, and since that time various owners have invested a total of €71m in the project. Experts believe that complet-ing the hotel would make no sense given the poor quality of the structure, according to a report in Delovoy Peterburg.

Sberbank sets aside €640m for residential housing

Sberbank has signed a collaboration agree-ment with the St. Petersburg authorities per-taining to its participation in the funding of social housing construction programmes in the city. The bank is ready to allocate €640m to support low-cost housing construction projects. The agreement also covers the de-velopment of mechanisms for the assured redemption of housing built within the framework of these programmes and loans for the participants in the programmes.

M-Industria resumes suspended project in Sochi

M-Industria has resumed its residential project in Sochi. The construction of an upmarket 20-storey building costing €29m was suspended at the beginning of the year. It is now intended that the first stage should be completed by the end of the year; 70% of the flats have already been sold. The developer is now able to continue the implementation of

the project after agreeing a debt restructuring plan with its creditors.

After the first stage has been complet-ed M-Industria plans to start the con-struction of the next, which includes the construction of a 20-storey, 27,000 m2, up-market building (21,000 m2 of which will be residential).

Zolotoy Ostrov project stalled

The Zolotoy Ostrov project is not like-ly to be developed in the near future. The project would involve the construction of an upmarket commercial and residential property within the so-called Golden Island (Zolotoy Ostrov) – a 47-ha area located on the south bank of the Moscow river direct-ly opposite the Kremlin. The main problem with the project is that parts of it belong to different owners, who are finding it difficult to agree on the joint development of the area. Furthermore, the fact that there are may his-torical monuments on the site means that the procedure for obtaining construction per-mits is unusually complicated.

Moskonversprom to build residential housing in Sochi

Moskonversprom has prevailed in a tender for the construction of a residential district in Sochi. The project involves 116 new residenc-es, ranging from 56 to 270 m2 on a 15.7-ha site in the Adlersky district of the city. The tender attracted 19 other participants from Russia and Montenegro, but the price offered by Moskonversprom was 20% lower.

Construction of “millionaires’ city” suspended

Sberbank and Mikhail Shishkanov, the owner of Binbank, have decided to suspend the

€1,144 per m2. The Baltros Group was later asked by the St. Petersburg authorities to re-duce the price by 14%, to €990 per m2 in ac-cordance with a new decree of the Ministry of Regional Development on 10 July, which established the new price of a square metre of land in St. Petersburg. Baltros is to make and announce its decision in a few days.

Kaliningrad land auction postponed

The Kaliningrad authorities have post-poned the first land auction for the planned Yantarnaya gambling zone on the Baltic Sea coast, until the end of August 2009.

The proposed site is located 50 km from Kaliningrad in the western part of Russia, occupies 27 ha and is estimated to be worth €1.8m. The construction of Yantarnaya will take 7–10 years and cost up to €13.5bn.

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Planned investments

Russian Construction Review – Issue No. 16 (77)Tuesday, 4 August 2009

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construction of the Rublevo-Arkhangelskoye multipurpose complex, also known as “millionaires’ city”. The companies intend to revise the project schedule by Q3 2009, as the current unfavourable economical situation renders the current business plan irrelevant in terms of the initially suggested degree of funding and the rate of construction.

The complex was initially to have includ-ed three residential structures in addition to an office building for Sberbank, which is re-sponsible for 10% of the project. The bank is also said to be renegotiating its share of the updated project.

Development of new Sochi district begins

The development of a project involving the new Tavrichesky district has begun in Sochi. This is part of the overall preparation of the city for the 2014 Olympic Games. The district consists of 166 sites covering a total area of 16 ha.

The new district is intended to provide accommodation for people whose exist-ing housing is located on the site of the pro-posed Olympic infrastructure, such as the Adlerskoe Koltso road junction and a new section of the Adler-Veseloye federal road. The area of the new houses varies between 50 and 300 square metres.

Once the project has been approved the Olimpstroy state corporation will invite building contractors to begin construction work.

Non-residential

Construction of Parliament buildings on site of Krasnaya Presnya put on holdThe Moscow authorities are reconsidering their decision to build a Parliamentary com-plex on the site of the Krasnaya Presnya sta-dium. The decision was made at the end of 2008 despite the protests of local residents, for whom the stadium was the only sports facility in the district. However, the current situation reflects not only these protests but

also the fact that the federal government has not yet decided on the exact location of the Parliamentary buildings.

Suzuki abandons plan to build factory in Leningrad Province

Suzuki has abandoned a plan to build its own factory in Leningrad Province. The car man-ufacturer has not extended its lease on the 50-ha site on which the plant would be built. Representatives of Suzuki Auto MFG Rus – the Russian subsidiary of Suzuki – have not commented on the company’s future plans in Russia. However, the St. Petersburg author-ities believe that Suzuki might reconsider having a factory in the region again once the Russian car market has started to recover.

Chizevskoye Podvorie to be sold to VTBC-DB Real Estate PartnersThe VTBC-DB Real Estate Partners fund is to acquire Chizevskoye Podvorie – a ho-tel project in Nikolskaya Street in the cen-tre of Moscow. The project, developed by Korporatsia Alt, involves the construction of 44,200 m2 of property, consisting of a hotel and apartments. It is believed that the fund intends to pay €34m for the asset. Both par-ties have confirmed that the fund has insti-gated the due diligence process, which is due to be completed in September.

Eastfield Logistics suspends project in Krasnodar

Eastfield Logistics has suspended the con-struction of an A-class logistics complex in Krasnodar, principally because of potential difficulties in attracting more external in-vestment in the project and intense compe-tition with regard to high-end warehouses. The construction of 98,000 m2 of high qual-ity warehouses on a 20-ha site assumed in-vestment of €30m from Eastfield Logistics and was to have been completed at the end of 2009/beginning of 2010.

Civil engineering

Avtodor – first tenders in August 2009

By 2015 the state corporation Avtodor in-tends to attract and spend €22.4bn on build-ing and transforming federal motorways into toll roads. The project will be funded by federal subsidies and income from exist-ing toll roads. The first tenders for investors in road construction are to be concluded in August this year. During the first stage over 5,000 km of federal roads will be transferred to Avtodor.

Avtodor was established in July this year to develop and manage road and roadside infrastructure, along with the Federal Road Agency (Rosavtodor), in accordance with Transport Ministry plans. The company will receive between €1.1-2.2bn each year from the federal budget.

Pushkinskaya Square and Tverskaya Zastava to be rebuilt

The Moscow authorities plan to complete the reconstruction of Tverskaya Zastava Square and Pushkinskaya Square, which are includ-ed in the Bolshaya Leningradka project, by 2013. This project was started in 2006 and in-cludes the reconstruction of Tverskaya Street, Leningradsky Prospect, Leningradskoye Highway and three squares – Pushkinskaya, Triumphalnaya and Tverskoy Zastavy. The project’s aim is the development of a ma-jor thoroughfare connecting the cen-tre of Moscow and the Moscow Ring Road (MKAD), running from the Kremlin along Tverskaya Street, Leningradsky Prospect and the Leningradskoye Highway. It will have no traffic lights and will provide 17 traffic lanes, with double the current road capacity.

In 2010 traffic will be fully restored between Manezhnaya Square and the MKAD. Between 2012 and 2013 all reconstruction work will be completed close to the Bielorussky railway station and Pushkinskaya Square. All recon-struction work is being carried out in accord-ance with the original schedule.

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MinTrans in search for investor for a new terminal at the Lviv airportThe Ministry of Transport and Communications of Ukraine (MinTrans) announced the tender for construction of a new terminal at the “International Airport Lviv.” The auction will take place on 9 September and the winner will receive the ownership of the terminal as well as sign a contract for management of the airport. The

draft of the new terminal was designed by Tebodin Ukraine, with the value of the proj-ect estimated at €98.6m. The construction is scheduled to start by the end of September 2009 and be completed in October 2011.

Highest skyscraper in Ukraine to go up in Dnipropetrovsk

The highest skyscraper in Ukraine - the 190-metre multifunctional Brama complex - is to

be built in the heart of Dnipropetrovsk, ac-cording to Arendator. The total area of the fifty-storey building is to reach 227,000 m2. The facility will consist of five structures in-cluding office, residential and commercial as well as shopping and entertainment ar-eas. Currently the project is at the planning stage and is being prepared by the designer Dolnik & Co.

Residential construction declines by 32% in Q1 2009

In Q1 2009 the total volume of new resi-dential housing added to the existing stock in Ukraine amounted to 1.3 million m2. This equates to a decrease of 31.8% in re-lation to the same period a year ago when

Construction of toll road between St. Petersburg and Moscow to start next yearDuring the week which began on 27 July, the Russian Ministry of Transport was to have concluded a concession agreement on the construction of the initial section of the toll road between St. Petersburg and Moscow. The road will be built by as yet unidentified European companies. This initial section will cover the first 43 kilometres from the MKAD to Zelenograd. Construction is due to start next year and will create around 8,000 new jobs. This is the second concession agree-ment of this kind – the first pertained to the construction of an 18 kilometre section of the toll road between Moscow and Minsk.

Glavnaya Doroga signs concession contract for MKAD-M1 junctionThe Glavnaya Doroga consortium has signed a concession contract with the Transport Ministry pertaining to the construction of a junction of the MKAD and the M1 Moscow-Minsk motorway. The concession period is 30 years, and the project cost is €583m, of which €334 will be financed by the concessioner, and the remainder – by the Investment Fund of the Russian Federation.

Railway to connect Sochi and Adler airport by the end of 2011A new railway connecting Sochi and Adler airport will be put into operation in Q4 2011. The track is one of 218 objects due to be built in Sochi in preparation for the 2014 Olympic Games. It will be able to transfer 64,000 pas-sengers in each direction every day, with four pairs of trains running every 15 minutes.

So far €9.3m has been spent on the con-struction of four ramp supports, along with the concreting of 19,000 m2 of the western terminal of the railway station in Sochi and 200 metres of a temporary road. Crucial steps include the construction of concrete supports for the bridge over the river Khirota and the concreting of the foundation of the “Airport” railway station, which will have a passenger hall and a station platform – 135 metres long and 8 metres wide.

Italian companies to invest €100m in road infrastructure in UgraOn 22 July 2009 representatives of three Italian companies – C.O.M.INT srl, Brambati Group and N.P.M. Hospital – held negotiations with the authorities of the Khanty-Manisyisk Autonomous Okrug on a €100m investment in the construction of road infrastructure and a cardiology centre in the region.

The projects discussed included the con-struction of a two-level road junction in Ugra, a 94 km road between Surgut and Lyantor and the construction of a cardio-centre for the Regional Clinical Hospital. Both road construction projects require investment of around €38m. The amount invested could reach €100m, if the construction of the cardi-ology centre is taken into account.

It is possible that the region will offer other investment opportunities to the Italians.

Banks to manage government contracts

The Russian Prime Minister Vladimir Putin has authorized the VTB Bank as the sole ex-ecutor for managing government contracts for the reconstruction of the Bolshoy Theatre and the M-5 highway Ural. At the same time Gazprombank will become the sole executor of all government contracts for the construc-tion of 24 residential buildings in Balashikha, 75 in Podolsk and also buildings in the St. Petersburg suburb of Osinovaya Roshcha. All the government vendors must agree on contracts with these banks by no later than 1 July 2010.

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Ukraine

Russian Construction Review – Issue No. 16 (77)Tuesday, 4 August 2009

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1.9 million m2 were added, according to data from the State Statistics Committee of Ukraine (Ukrstat).

Overall, 12,287 of residential units with an average size of 103.3 m² were commissioned in January–March 2009. These include 2,950 one-room apartments (average size of 55.8 m²), 3,890 two-room apartments (73.4 m²), 3,039 three-room flats (106.8 m²) and 1,381 four-room apartments (161.0 m²). The aver-age cost of 1 m2 of the commissioned units (except for those financed by individuals) amounts to €405, compared to €350 in Q1 2008.

Construction of Mall of Ukraine postponed

The construction of the shopping and enter-tainment centre Mall of Ukraine, nearby Kyiv, planned for 2009 has been postponed for

11–14 months. This decision was caused by the financial difficulties of the project devel-oper, DEOL Partners Company. As a result the construction works will not commence sooner than in December 2010.

At present the company is investigating possibilities of raising a €74m loan package for the construction.

Once completed, the facility will house an Auchan hypermarket, which has al-ready signed the lease contract for the 18,000 m2, entertainment complex and bou-tiques gallery.

XXI Century in search for an investor

The Ukrainian property developer XXI Century has frozen all its projects and is looking for additional financing in an attempt to attract strategic partners to co-finance or

sell a share in its projects. The company con-siders collaboration with domestic or foreign developers, financial institutions and even private equities. The terms for attracting in-vestment include project financing and lend-ing, as well as the sale of shares in the projects. The company does not plan to begin building new facilities until 2010 and currently focus-es on restructuring its debts.

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Constructionchemicals market

in Poland 2009Development forecasts

for 2009-2011

Tuesday, 4 August 2009Russian Construction Review – Issue No. 16 (77)

9PMR

The Irkutsk authorities are planning to rebuild the historic cen-tre of the city for its 3�0th anniversary, which will be celebrated in the summer of 2011.

n A six-storey underground parking facility (taking up more than 10,000 m2) under Turgenevskaya Square, with room for 300 cars, will be launched by the end of November 2009, according to an Interfax report.

n

In brief

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C trucons tionsector in Belarus 2009

Russian Construction Review – Issue No. 16 (77)Tuesday, 4 August 2009

10 PMR

In the wake of the ongoing recessionary conditions on the global markets, the buoy-ancy of the Ukrainian economy has started to show signs of cooling. According to the Ministry of Economic Affairs, in H1 2008 the country’s real GDP grew by only 6.5% and, subsequently, in H2 2008 the effect of the glo-bal meltdown become more pronounced as many of the core industries in Ukraine, in-cluding construction and building materials, began to shrink. Furthermore, the Ministry believes that the country entered the slow-down cycle only in early November 2008, and that it is not, therefore, possible to estimate the degree and duration of any recovery.

The Ukrainian building materials industry accounted, on average, for 4.6% of national GDP.

Ministry of Economic Affairs statistics suggest that between 2002 and 2007 on the basis of current prices, the building materials industry grew at an average annual rate of 28.7%However, in the wake of the ongoing fi-nancial crisis, according to a study by Korrespondent the building materials industry in Ukraine shrank by 20.6% in 2008, reflecting an estimated loss of $2.7bn. This also explains the 40% year-on-year reduction in the sales of build-ing materials between May and August 2008 alone in comparison with the cor-responding period of the preceding year – according to the Ukrainian business resource portal www.bizukraine.com.

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In accordance with the Ukrainian classifica-tion, the building materials industry consists broadly of the following eight subdivisions:

cement roofing materials (soft and corrugated asbestos slates)granitewall materialspaints and varnishesceramic tilebricks (baked/ lime-sand)other building materials (including pre-fabricated reinforced concrete, metal structures, construction joinery goods, gypsum, ceramic tiles and glass).

Ukraine is almost a net importer of build-ing materials, primarily because of high energy costs and old manufacturing equip-ment, accompanied by outmoded technolo-gy, which create substantial opportunities for international companies.

Because of this, the import market for building materials in Ukraine is dominat-

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ed by high quality and competitively priced products from countries such as Germany, Italy, Austria, Spain, France, Norway, Sweden and Finland. In the recent past, manufactur-ers from the US have also been aggressively trying to exploit the market – although their share is still low because of the fierce compe-tition from their established European peers.

The estimated size of the building materials industry in Ukraine increased from $4.0bn in 2002 to $10.2bn in 2008, reflecting a CAGR of 17.1%. In the wake of the current econom-ic crisis the industry suffered a serious year-on-year decline of 20.6% in 2008.

The major factors which have, so far, been driving the building materials industry in Ukraine include:

accelerated demand for commercial property because of the increase in the number of domestic and overseas firms operating in the larger/industrialised cities in Ukraine an affluent class consisting of Ukrainian and Western business people putting pressure on demand for state-of-the-art residential and office premises – in-dicative of the lifestyles of the rich and famous in the West an increasing trend among the Ukrainian public toward renovating apartments and summer homesaccelerated demand for residential housing, and affordable housing in par-ticular, as a result of increases in the dis-posable income of the middle class in the countryincreased government spending on the development of infrastructure facilities and the implementation of a range of major domestic construction projects.

In terms of the competitive landscape, ac-

cording to the US Department of Commerce, the key players in the various subdivisions of the building materials industry in Russia include:

cement: UkrCement, Amrosivsky, Balaklevsky, Dniprodzerzhynsky,

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Market overview & statistics

Current status of Ukraine building materials marketThe Ukrainian economy is second only to Russia among the CIS countries in terms of size. After Ukraine left the Soviet Union in 1991, its economy recov-ered strongly in a very short period of time, with average annual GDP growth of almost 7% between 2000 and 2008. This clearly indicated that Ukraine had effectively carved a new identity for itself in the global order – one capable of creating a niche for its raw materials and finished goods on the international market – by opting for a “free market” system rather than the planned econo-my of the Soviet era. This, in turn, explains the country’s joining of the WTO in February 2008, which made it one of the first CIS nations to be closely integrat-ed with the global economy.

www.pmrpublications.come - estimateSource: Ukrainian Ministry of Economic Affairs, Ukrainian State Statistics Committee, PMR Publications, 2009

Estimated size of building material industry in Ukraine ($ bn), 2002-2008

4.0 4.8

9.3

2002 2003 2004

10.9

2005

12.0

2006

12.0

2007

10.2

2008e

Tuesday, 4 August 2009Russian Construction Review – Issue No. 16 (77)

11PMR

Ivano-Frankivsk, Kamyanets-Podilsky, Kramatorsk, Kryvorizhsky, Mykolaiv, Yenakyivo and Zdolbynovskyroofing materials: Hipron, Finprofil and Rautaruukki (based in Finland)granite: Ukrbudmaterialy, Khust Stone Processing, Minselkhozprod, Hoskomzhylkomunkhoz and Hoskomgeologywall materials: Vinisin, UkrBudMaterialy and DneproMainvarnishes and paints: Dnipropetrovsk Lakokrasochniy Zavod, Symykhimprom, Lakma, Nifar, Elaks, Raduga and Spektrceramic tiles: the Kharkiv Ceramic Tile Plant, the Lviv Ceramic Plant, the Kyiv Keramik Plant, Keram Perlit and the Agromat Production Company.

Kyiv and its suburbs constitute the most substantial market for the building material industry in Ukraine, followed by a number of upcoming centres of industrial excellence: Kharkiv, Dnipropetrovsk, Donetsk, Lviv, Odessa and Zaporizhzhya.

The building materials industry in Ukraine is characterised by the following:

the domination of the domestic landscape by the private sector

a monopoly by the larger conglomer-ates – i.e. one particular group/combine wielding greater control of the produc-tion facilities of a variety of building materials: e.g. Ukrbudmaterialy, which alone comprises about 150 enterprises manufacturing a host of building mate-rials such as wall materials, granite, dry building mixtures, glass and sanitary ware. Similarly, UkrCement has 12 lead-ing cement manufacturing firms in the country under its wingthe fact that imports almost outweigh domestic production and considerably exceed exports, thus clearly prompting a shortage of building materials in the country

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key items being exported from Ukraine including: cement, granite, wall materi-als and paint and varnisheskey building materials being imported into Ukraine including: insulated win-dows and doors, false ceilings, floor cov-ering, wall covering and other interior decorating materials, paints, plasters, cement mixtures, sealants, waterproof-ing materials, insulation materials, heating systems, piping and bathroom accessoriesthe entry of many foreign, particularly European, players, in recent years, with many of them gaining a strong foothold on the local market in their respective spheres of activity.

In addition, building material produc-ers/manufacturers from Austria, Belgium, Canada, Denmark, the US, the UK, Holland, Hungary, Ireland, Israel, Portugal, Spain, Slovakia, Sweden, Switzerland and Turkey have also established a foothold in Ukraine.

Several overseas companies from Germany, France, Italy, Finland and Austria have set up joint manufacturing ventures in the country – a trend which is likely to continue in terms of market entry strategy.

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Outlook

The market for building materials in Ukraine will remain extremely challenging in 2009 because of the following factors:

the majority of international compa-nies are cancelling their long term in-vestment programmes for the next few years, in order to clear stockpiles at their respective warehousesindustry experts and leading economists firmly believe that there will be a sub-stantial contraction of GDP and a de-cline in the currency, coupled with high inflation and extremely tight lending norms. This does not augur well for con-struction and associated industries, as a fall in property prices will eventually be offset by the high cost of borrowing.

However, despite the bleak outlook, the current downturn presents an ideal platform for international risk-taking players who are in pursuit of inorganic expansion, particu-larly in markets such as Russia, Ukraine and Kazakhstan. These are likely to be replete with opportunities arising from bankrupt-cies and M&As.

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www.pmrpublications.comSource: US Department of Commerce, PMR Publications, 2009

Leading international manufacturers of building materials in UkraineMajor Categories Manufacturers/ ProducersGermany

Plastic and metal panelsKnauf, Moller, Khipping, Plus Plan, Plusthc, Wahl GmbH, Alfa -Lacke,Wolfcraft, OWA, Weidner, Atex, Hufgard, Dollken, Volta, Decosa and

AlucobondMetal structures andproviders of technologies Raynaers, Plusthc, Khipping, Heroal, Neher and Plus PlanPaints Meffert AG, Paul Mittermayer Gmbh, Jobi, Dezowag, Lacufa and LoberInsulated windows anddoors Veka, Schuco International, Gealan and RaumplusWindows, doors, andfurniture fittings

Sanha, Siegenia, Hafele, DOM, HP Plus, FSB, GEZE, WinkHaus, WahlGmbH and Teckentrup

Roofing materials Creaton and A.B. AnddernachItalyDoors and windows Albertini, TRE-P, Garofoli, Dierre, Olibari, Valli&Valli, F usital and CameFinlandRoofing products RautaruukkiFranceWall covering, paints andflooring materials Alpa, Profitex, Barrisol, Acron and Berry Wood

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Russian Construction Review – Issue No. 16 (77)Tuesday, 4 August 2009

12 PMR

Basic economic and construction industry indicators

www.pmrpublications.comSource: Rosstat, 2009

Inflation in building materials in Russia (y-o-y), July 2008-July 2009

Jul/08 Aug/08 Sep/08 Oct/08 Nov/08 Dec/08 Jan/09 Feb/09 Mar/09 Apr/09 May/09 Jun/09

15.6%13.6% 12.4% 11.9% 11.7% 11.3% 10.7% 10.4% 9.9% 8.6% 7.2% 5.9% 4.9%

Jul/09

Co 9nstruction output and main macroeconomic indicators, 2005-200

www.pmrpublications.comeop – end of period

Source: Rosstat, CBR, PMR Publications, 2009

2006 2007 2008 Latest 2009RUB bn 2,350.8 3,293.3 4,528.1 Jun 348.0

€ bn 68.9 94.1 124.4 Jun 8.0Construction outputy-o-y 18.1% 18.2% 12.8% Jun -19.6%

GDPGDP at current prices € bn 780.5 942.5 1,144.4 Q1 194.5Real GDP change y-o-y 7.4% 8.1% 5.6% Q1 -9.8%GDP componentsHousehold consumption y-o-y 11.4% 13.7% 11.3% Q1 -3.2Gross fixed capital formation y-o-y 18.0% 21.1% 10.0% Q1 -16.3Gross value addedManufacturing y-o-y 7.3% 8.1% 1.2% Q1 -23.5%Construction y-o-y 11.8% 13.7% 13.2% Q1 -20.9%Real estate, renting, business activities y-o-y 10.2% 19.5% 10.8% Q1 -7.8%OutputIndustrial output y-o-y 3.9% 6.3% 2.1% Jun -12.1%Foreign tradeExports $ bn 303.9 355.2 471.6 May 22.7Imports $ bn 164.7 223.1 291.9 May 13.9Balance $ bn 139.2 132.1 179.7 May 8.8PricesCPI y-o-y, eop 9.0% 11.9% 13.3% Jun 11.9%PPI y-o-y, eop 10.4% 25.1% -7.0% Jun -9.4%Unemployment eop 6.9% 6.1% 7.7% Jun 8.3%SalariesGross monthly salaries € 315 378 473 Jun 434Real change in gross monthly salaries y-o-y 13.3% 17.2% 10.3% Jun -5.2%Investment

RUB bn 4,580 6,419 8,765 May 568.9Capital investment

y-o-y 13.7% 21.1% 9.8% May -23.1%$ bn 13.7 27.8 27.0 Q1 3.2

Foreign direct investmenty-o-y 4.6% 102.9% -2.8% Q1 -43.0%

Exchange rates€/RUB average 34.1 35.0 36.4 Jun 43.5$/RUB average 27.2 25.6 24.8 Jun 31.0

2007 2008 Jan-Jun 2009Types of building materials unit volume y-o-y index volume y-o-y index volume y-o-y indexCement million tons 59.9 9.4% 53.6 -10.6% 19.3 -28.6%Bricks billion standardised bricks 13.1 12.0% 13.4 2.2% 3.9 -40.7%Ceramic floor tiles million m2 68.9 7.1% 73.8 6.6% 28.8 -19.0%Ferroconcrete production million m3 28.9 13.2% 28.4 -2.3% 8.2 -44.5%Timber million m3 23.2 5.0% 22 -9.4% 9.2 -18.5%Construction glass million m2 71.2 29.1% 56.1 1.7% 41.7 61.1%Float glass million m2 115.8 0.5% 123 6.2% 58.8 -6.7%

Tuesday, 4 August 2009Russian Construction Review – Issue No. 16 (77)

13PMR

Construction output

www.pmrpublications.comNote: In the beginning of 2008 Rosstat revised data for 2006 and 2007Source: Rosstat, 2009

24.1 16.013.5

2 .1 8 23.420.8 19.4

14.512.9

25.8

13.6 14.1

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

30.3 30.027.0

20.5

1 .26

12.1

6.49.8

5.9 6.30.1

17.2

-16.8 2007 2008 2009-20.7 -20.2

-16.3

-21.9 -19.6

Source: Rosstat, 2009

Construction outputin Russia (RUB bn)in Jan-Jun, 2007-2009

Jan-Jun 2007 Jan-Jun 2008 Jan-Jun 2009

1,189.31,788.7 1,558.8

Source: Rosstat, 2009

Change in constructionoutput in Russia (y-o-y)in Jan-Jun, 2007-2009

25.5% 22.4%

-19.3%

Jan-Jun 2007 Jan-Jun 2008 Jan-Jun 2009

www.pmrpublications.com

particular

Value of construction work contracts signed Backlog of orders

Jul08

Aug08

Sep08

Oct08

Nov08

Dec08

346.2 342.2 329.3308.1 293.4

260.4299.7

338.8

2.0 1.9 1.81.5 1.5 1.4 1.3

3.6

Jan09

Feb09

342.0335.6

3.5

2.7

Mar09

Apr09

315.1

May09

2.4 2.3

288.3

Jun09

346.0

2.4

Jul09

Regional comparison of construction industry performance in CIS countries, 2007-2009

www.pmrpublications.comSource: Rosstat, State Statistics Committee of Ukraine, National Statistics Committee of Belarus, Statistics Agency of Kazakhstan, 2009

2007 2008 Latest 2009Russia

RUB bn 3,293.0 4,528.0 Jan-Jun 1,558.8Construction outputy-o-y change 18.2% 12.8% Jan-Jun -19.3%

‘000 m2

60,350.0 63,762.0 Jan-Jun 21,600Residential constructiony-o-y change 19.4% 4.5% Jan-Jun -0.3%

UkraineUAH bn 53.7 64.4 Jan-Jun 14.9Construction output

y-o-y change 15.6% -16.0% Jan-Jun -54.9%‘000 m

210,244.0 10,496.0 Jan-Mar 1,295Residential construction

y-o-y change 18.7% 2.5% Jan-Mar -33.8%Belarus

BYR bn 10,600.0 15,473.0 Jan-Jun 9,188.5Construction outputy-o-y change 16.4% 22.2% Jan-Jun 22.8%

‘000 m2

4,665.0 5,141.0 Jan-Jun 3,097.8Residential constructiony-o-y change 14.1% 10.2% Jan-Jun 14.2%

KazakhstanKZT bn 1,566.0 1,783.0 Jan-Jun 664.6Construction output

y-o-y change 5.7% 1.8% Jan-Jun -10.9%‘000 m

26,679.0 6,832.0 Jan-Jun 2,960Residential construction

y-o-y change 7.0% 2.3% Jan-Jun 3.1%

Russian Construction Review – Issue No. 16 (77)Tuesday, 4 August 2009

14 PMR

Construction output in federal subjects of Russian Federation, 2008-2009January-December 2008 January-June 2009

RUB million Change (%, year-on-year) RUB million Change (%, year-on-year)Russian Federation, total 4,528,144.7 12.8 1,558,839.3 -19.3Central Federal District 1,211,169.5 0.9 428,561.1 -18.1Belgorod Province 40,393.4 16.0 10,628.8 -33.8Bryansk Province 11,861.5 13.6 4,026.4 -10.0Vladimir Province 20,527.7 2.0 8,392.8 -15.5Voronezh Province 30,800.6 8.5 9.601.9 -9.6Ivanovsk Province 12,064.7 2.0 3,618.0 21.6Kaluga Province 23,497.3 25.1 8,441.4 -12.7Kostroma Province 6,645.0 -21.9 1,274.2 -47.8Kursk Province 16,409.4 11.4 8,149.7 -9.0Lipetsk Province 24,431.5 0.0 9,512.1 -7.6Moscow Province 260,745.8 0.6 91,637.7 -22.1Oryol Province 11,293.5 -2.5 2,758.6 -45.2Ryazan Province 24,596.0 -16.4 4,409.0 -61.4Smolensk Province 15,704.4 22.1 5,709.8 -11.0Tambov Province 16,551.3 15.2 5,390.5 0.6Tver Province 22,317.9 39.4 9,442.4 -0.1Tula Province 22,021.0 0.5 11,387.1 28.7Yaroslavl Province 30,142.7 0.1 13,587.9 6.1City of Moscow 621,165.8 -1.8 220,592.7 -18.6Northwestern Federal District 621,651.4 -0.5 233,939.8 -20.0Republic of Karelia 10,267.0 24.0 2,846.0 -31.4Komi Republic 41,053.6 -0.2 21,191.9 18.2Arkhangelsk Province 37,140.7 -21.0 8,894.1 -50.6Including Nenetsia Autonomous District 12,657.0 -56.9 3,454.2 -52.9

Vologod Province 33,910.8 -27.8 12,077.0 -23.4Kaliningrad Province 24,525.1 34.9 7,571.3 -4.8Leningrad Province 73,866.8 1.8 37,972.3 -10.4Murmansk Province 15,730.4 11.1 3,833.2 -39.0Novgorod Province 12,874.7 11.8 4,375.1 0.8Pskov Province 9,166.0 3.9 2,758.8 -17.1City of St. Petersburg 363,116.3 2.0 132,420.2 -23.1Southern Federal District 478,162.8 12.3 150,020.8 -9.1Adygea Republic 6,425.0 -21.2 1,726.3 14.3Dagestan Republic 45,666.8 29.7 12,631.0 18.2Ingushetia Republic 3,528.4 -39.6 1,108.4 -27.4Kabardino-Balkaria Republic 6,193.7 13.4 1,946.7 -8.8Kalmykia Republic 2,563.5 14.0 681.8 0.9Karachay-Cherkessia Republic 5,910.4 1.3 1,487.9 -48.1North Ossetia-Alania Republic 11,399.4 0.3 2,707.0 1.2Chechen Republic 27,970.4 3.3 1,658.1 -1.0Krasnodar Territory 182,311.4 15.6 65,799.9 -4.2Stavropol Territory 28,329.4 14.3 9,142.3 -7.9Astrakhan Province 27,864.1 23.2 7,354.1 -26.0Volgograd Province 49,586.6 12.9 15,793.0 -14.9Rostov Province 80,413.8 6.3 27,984.5 -18.3Volga Federal District 689,031.7 11.5 223,610.7 -26.6Bashkortostan Republic 101,406.9 4.4 29,465.3 -25.4Mari El Republic 8,847.0 2.5 2,776.2 -33.1Mordovia Republic 14,825.4 5.1 4,382.8 -17.2Tatarstan Republic 143,443.3 11.3 67,061.4 -3.5Udmurtia Republic 22,357.1 -3.5 5,790.0 -33.1Chuvashia Republic 32,891.2 -5.7 7,695.3 -41.6Perm Territory 52,697.8 -1.8 21,937.7 -17.6Kirov Province 12,598.4 1.3 3,135.4 -44.6Nizhny Novgorod Province 114,045.5 57.5 29,970.5 -45.0Orenburg Province 34,507.1 16.3 9,561.8 -37.7Penza Province 32,418.6 18.5 9,026.0 -36.5Samara Province 54,778.9 -2.9 15,277.6 -27.8Saratov Province 40,716.7 5.4 10,693.3 -34.4Ulyanovsk Province 23,497.5 13.5 6,837.5 -35.5Urals Federal District 635,313.3 15.2 223,712.1 -17.6Kurgan Province 9,125.3 20.6 3,793.3 -3.4Sverdlovsk Province 112,934.7 1.1 32,258.4 -31.2Tyumen Province 441,530.6 20.6 169,118.4 -11.4Including:Khanty-Mansi Autonomous District (Yugra) 177,748.8 11.6 68,410.3 -23.1Yamal-Nenets Autonomous District 186,036.9 34.3 78,990.2 8.8

Chelyabinsk Province 71,722.8 8.1 18,541.9 -37.8Siberian Federal District 395,055.9 1.1 118,948.2 -31.9Altai Republic 4,378.2 0.3 1,230.5 -32.0Buryatia Republic 10,570.2 5.7 3,795.6 4.6Tyva Republic 1,027.1 -6.9 429.6 23.3Khakassia Republic 7,240.7 -13.6 1,408.9 -33.1Altai Territory 23,907.8 -4.9 6,707.5 -37.7Zabaykalsky Territory 27,154.6 34.8 7,710.8 -22.2Krasnoyarsk Territory 61,188.4 4.9 22,518.2 -24.6Irkutsk Province 41,562.4 -29.7 14,099.9 -38.0Kemerovo Province 79,178.1 12.0 26,287.1 -23.0Novosibirsk Province 49,222.8 8.0 10,258.4 -52.8Omsk Province 50,817.8 5.2 11,280.9 -44.9Tomsk Province 38,807.8 -1.6 13,220.8 -22.6

Tuesday, 4 August 2009Russian Construction Review – Issue No. 16 (77)

1�PMR

www.pmrpublications.comSource: Rosstat, 2009

Flats completed in Russia (millions of m of spaceand y-o-y index), Jun 2007-Jun 2009

2

Flats completed Y-o-y index

Mar/09

Jun/07

Jul/0

7Au

g/07

Sep/07

Oct/07

Nov

/07

Dec

/07

Jan/08

Feb/08

Mar/08

Apr/0

8

May

/08

Jun/08

Jul/0

8Au

g/08

Sep/08

Oct/08

Nov

/08

Dec

/08

Jan/09

Feb/09

Apr/0

9

May

/09

0

5

10

15

20

-20%-10%0%10%20%30%40%50%

Jun/09

Homes completed, number and total floor space, 2005-2009

www.pmrpublications.comSource: Rosstat, 2009

2005 2006 2007 2008 Jan-Jun 2009Number of homes completed thousands 515 605 714 766 233.9Change y-o-y 8.0% 17.4% 18.0% 7.2% -2.7%Total floor space of homes completed million m2 43.6 50.6 60.4 63.8Change y-o-y 6.3% 16.1% 19.4% 4.5%

21.6-0.3%

In 2009, all types

of investors completed

new homes,

in January

new homes.

June

-June

55 9

233 9

, 00

, 00

www.pmrpublications.comSource: Rosstat, 2009

January-December 2008 January-June 2009RUB million Change (%, year-on-year) RUB million Change (%, year-on-year)

Far Eastern Federal District 247,636.2 -7.1 95,267.3 -15.5Sakha Republic (Yakutia) 49,924.0 8.0 23,541.5 11.9Kamchatka Territory 30,846.1 19.3 7,350.1 96.1Primorsky Territory 9,736.2 23.3 15,117.0 24.0Khabarovsk Territory 33,534.0 23.1 13,779.9 -27.3Amur Province 37,647.9 0.7 10,898.6 -13.5Magadan Province 5,288.1 26.9 1,846.6 -26.7Sakhalin Province 74,792.1 -32.2 20,771.2 -47.0Jewish Autonomous Province 4,042.0 -22.3 1,596.4 -3.8Chukotka Autonomous District 1,825.7 -19.8 366.0 -54.5

Housing construction

Total floor space of housing units completed in federal subjects of Russian Federation, 2008-2009January-December 2008 January-June 2009

Floor space (‘000 m2) Change (%, year-on-year) Floor space (‘000 m

2) Change (%, year-on-year)

Russian Federation, total 63,761.6 4.5 21,578.4 -0.3Central Federal District 19,052.2 -4.2 6,540.4 9.9Belgorod Province 1,112.6 4.6 362.6 -2.8Bryansk Province 318.3 6.6 114.3 16.8Vladimir Province 419.3 11.5 192.0 16.5Voronezh Province 1,118.5 14.8 318.6 18.9Ivanovsk Province 168.7 18.8 81.3 30.1Kaluga Province 628.6 37.2 142.7 -18.5Kostroma Province 138.0 -1.7 64.4 13.4Kursk Province 436.5 16.1 186.8 6.7Lipetsk Province 721.9 2.4 216.7 24.1Moscow Province 7,781.2 -0.3 2,584.5 18.5Oryol Province 326.7 5.4 84.6 -39.4Ryazan Province 502.7 10.1 279.3 6.9Smolensk Province 344.9 14.9 145.4 0.4Tambov Province 560.3 11.7 197.6 4.6Tver Province 343.8 -1.9 184.1 91.6Tula Province 417.2 29.5 72.5 0.3Yaroslavl Province 433.0 3.0 119.0 -25.1City of Moscow 3,279.9 -32.0 1,194.1 2.8

Russian Construction Review – Issue No. 16 (77)Tuesday, 4 August 2009

16 PMR

www.pmrpublications.comSource: Rosstat, 2009

January-December 2008 January-June 2009Floor space (‘000 m

2) Change (%, year-on-year) Floor space (‘000 m

2) Change (%, year-on-year)

Northwestern Federal District 6,505.7 15.0 2,055.9 -0.5Republic of Karelia 152.5 16.1 64.7 -3.5Komi Republic 184.4 -6.2 30.1 -15.6Arkhangelsk Province 304.6 17.3 55.6 -27.4Including Nenetsia Autonomous District 46.5 26.9 6.3 -68.4

Vologod Province 526.9 7.8 179.1 18.3Kaliningrad Province 800.1 6.3 282.4 -18.6Leningrad Province 908.0 7.6 522.8 21.4Murmansk Province 7.5 -40.9 11.9 250.0Novgorod Province 259.0 26.6 52.6 -43.5Pskov Province 151.2 15.1 78.1 90.1City of St. Petersburg 3,211.6 21.8 778.5 -5.2Southern Federal District 9,787.9 4.4 3,836.3 -4.0Adygea Republic 82.0 19.3 52.0 110.4Dagestan Republic 908.3 13.5 319.6 28.7Ingushetia Republic 59.2 80.7 14.5 23.7Kabardino-Balkaria Republic 245.2 3.4 79.1 1.5Kalmykia Republic 59.1 -23.9 31.4 41.4Karachay-Cherkessia Republic 94.5 1.6 36.9 -8.4North Ossetia-Alania Republic 196.9 12.1 95.3 0.0Chechen Republic 55.0 21.5 35.0 61.8Krasnodar Terr itory 3,837.1 3.6 1,435.3 -12.9Stavropol Territory 1,038.1 9.8 507.1 -0.9Astrakhan Province 382.5 -47.3 202.0 12.1Volgograd Province 821.7 7.8 237.3 -8.5Rostov Province 2,008.4 17.8 790.9 -7.6Volga Federal District 13,547.1 10.2 4,688.7 1.9Bashkortostan Republic 2,351.6 26.6 780.9 -3.8Mari El Republic 299.7 5.6 124.4 8.5Mordovia Republic 284.1 17.0 78.8 8.2Tatarstan Republic 2,222.4 8.9 1,132.5 1.2Udmurtia Republic 485.0 0.4 144.8 -24.5Chuvashia Republic 980.9 -2.4 238.4 4.9Perm Ter ritory 836.8 -5.4 252.1 -16.6Kirov Province 422.6 12.5 135.6 15.2Nizhny Novgorod Province 1,353.3 26.2 609.7 23.8Orenburg Province 778.2 3.4 286.9 0.3Penza Province 602.2 8.5 191.4 22.4Samara Province 1,315.9 2.2 240.0 -5.3Saratov Province 1,107.6 8.4 288.8 1.5Ulyanovsk Province 506.7 18.0 184.4 6.7Urals Federal District 6,162.3 10.2 1,825.5 -3.6Kurgan Province 282.1 45.0 118.0 5.5Sverdlovsk Province 1,704.3 2.7 484.7 -0.1Tyumen Province 2,166.1 4.8 756.2 -0.1including:Khanty-Mansi Autonomous District (Yugra) 848.1 -2.8 221.8 3.6Yamal-Nenets Autonomous District 225.2 -11.2 16.9 -47.8

Chelyabinsk Province 2,009.7 20.1 466.6 -13.7Siberian Federal District 7,060.3 2.1 2,207.1 -17.6Altai Republic 58.3 12.6 16.0 -33.3Buryatia Republic 312.2 15.4 87.7 -13.8Tyva Republic 44.7 34.9 8.6 68.5Khakassia Republic 190.4 16.7 59.0 -17.2Altai Territory 631.9 5.6 290.2 4.8Zabaykalsky Territory 255.0 9.5 129.0 103.6Krasnoyarsk Territory 1,094.1 -5.6 242.3 -10.2Irkutsk Province 476.2 -17.2 158.3 6.2Kemerovo Province 1,067.3 5.6 504.6 2.7Novosibirsk Province 1,391.0 9.1 355.9 -24.1Omsk Province 1,016.4 -7.9 167.8 -68.5Tomsk Province 523.1 18.1 187.7 -16.3Far Eastern Federal District 1,371.7 5.5 422.5 -4.6Sakha Republic (Yakutia) 280.2 -12.5 22.6 -37.6Kamchatka Territory 184.7 9.3 17.1 70.6Primorsky Territory 63.4 200.0 147.1 0.5Khabarovsk Territory 344.8 -6.0 118.8 0.2Amur Province 301.9 13.6 16.7 -55.5Magadan Province 15.0 1.7 1.5 -76.9Sakhalin Province 146.2 38.4 75.0 9.9Jewish Autonomous Province 34.3 14.4 23.6 31.0Chukotka Autonomous District 1.1 -82.9 - -

Tuesday, 4 August 2009Russian Construction Review – Issue No. 16 (77)

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Russian Construction Review – Issue No. 16 (77)Tuesday, 4 August 2009

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