Residential Complex "Pearl of Troyeshchyna"
Getting money back for unfinished housing is almost impossible.
Problematic construction projects, a trend dating back to the 2008 crisis, are resurfacing in Kyiv. The Ministry of Internal Affairs announced that it had halted construction on four residential complexes: "Pearl of Troyeshchyna," "Sosnovy Bor," "Shidna Brama," and "Mosaic." They explained that the construction was being carried out without permits on the seized land. This is why, they claimed, the construction equipment was seized pending the investigation.
The worst part is that people have already bought many apartments in these buildings under construction. The latest news left them in shock. “We bought a one-room apartment in September 2011, and were promised that the building would be completed in 2012. All the deadlines have since passed. But we were still hoping that we would somehow move in, and now construction has been banned… We can’t get our money back, and we don’t have our own place”; “So what now, demolish the building?! We sold our old apartment, invested in the construction, and are living in a rented apartment”; “We knew about the construction risks. But we didn’t have enough money for housing in other residential complexes, and this one was ok. The news is certainly unpleasant, but I still hope the building will be finished. The only questions are ‘when’ and ‘how much will we have to pay extra?’” investors write on forums. They were all swayed by the below-market price at the time—starting from 9 UAH/sq. m.
DOZENS OF OBJECTS
Experts confirm that the developer has dozens of properties across Kyiv. "They offered the lowest prices on the market. Often, you couldn't even build a proper property for that price. The proceeds from unfinished apartments were invested in subsequent projects. The disaster could surpass the Elita Center in scale," says real estate expert Serhiy Kostetskyi. The most recent project is a planned residential complex in Kadetskyi Hai. Late last year, a plot of land for it was attempted to be fenced off with the help of titushki. Local residents rebelled against the proposed development in the forest, and the Kyiv City State Administration supported them.
Residential complex "Skhidna Brama"
CONTINUES TO SELL
The most interesting thing is that apartments in all these residential complexes are still selling. Yevhen, an employee of the sales department at Skhidnaya Bramy, told us not to worry about the searches at their company: "It's the senior management at the top who decides who owes whom. That's why they're setting them on us. The prosecutor's office even came to search. But construction is ongoing, and the sales department is working." Currently, the residential complex is offering apartments in both the sections under construction and in the building that's still at foundation level. Prices start at 9,000 UAH/sq. m. The sales department at the Mosaic residential complex, whose construction has also supposedly been halted, also assured us that work is in full swing. Apartments are available for 11,000-12,000 UAH/sq. m. And in the section that has just begun construction (due in Q3 2016), prices start at 10,000 UAH/sq. m.
Residential complex "Mosaic"
"Of course, we'll finish construction, and people won't be left without apartments. This is a temporary setback," the sales department at Mosaic told us. Indeed, no one has stopped the construction: the websites of the Zhemchuzhina Troyeshchyna and Mosaic residential complexes are posting recent photos from the site. Residents of nearby buildings also confirm that construction is ongoing. "I don't know what equipment was confiscated, but the crane at Sosnovy Bor on Olevska Street is working at full speed," they write on social media. Lawyer Alexander Bosenko doesn't rule out the possibility that the developer and the authorities will reach an agreement: "Perhaps the company will change the name and the name of the property and continue selling apartments." Vesti tried calling the developer's office, but no one answered the phone all day.
How to buy an apartment from a reliable developer
To avoid being left with nothing, experts advise apartment buyers to research the developer's reputation and avoid being swayed by prices that are significantly below market value. "You need to research the developer's history: what projects they've built, and whether there have been any issues," advises Alexander Bosenko. Experts also recommend examining the land plot documents to determine its intended use. If the land is leased by the developer, the lease term should be for at least several years. It's best to buy apartments in buildings that are at least halfway completed. A lot of useful information can be found on forums where other potential construction investors interact; they often uncover interesting details about the developer.
Maxim Kukalo, Vesti
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