Kyiv Ploshchad has agreed with Vanke Group to purchase a project for the restoration of the Imperial Orphanage near Zaryadye Park.

Kyiv Ploshchad has agreed with Vanke Group to purchase a project for the restoration of the Imperial Orphanage near Zaryadye Park.


The Chinese Vanke Group has decided to finally get rid of its only project in Russia – the restoration of the former Imperial Orphanage near Zaryadye Park in the center of Moscow. As Kommersant learned, the group agreed to sell the asset, estimated at 30 billion rubles, to the Kyiv Ploshchad Group of Companies, founded by God Nisanov and Zarakh Iliev. Market participants explain the Chinese group’s withdrawal from the project by the decline in its attractiveness over two years of geopolitical crisis. In addition, Vanke had difficulties in its home market.

The fact that Kievskaya Ploshchad has agreed with Vanke Group to purchase the project for the restoration of the Imperial Orphanage near the Zaryadye Park near the Kremlin was reported to Kommersant by two sources in the real estate market. One of the consultants clarified that the deal is at the final stage. Kievskaya Ploshchad and Vanke did not respond to Kommersant’s request.

Kyiv Ploshchad was founded by God Nisanov and Zarakh Iliev and is one of the largest owners of commercial real estate in Russia. According to Forbes estimates, in 2023 the group’s rental income increased by 10% year-on-year, to $1.76 billion. The group owns, in particular, the Evropeisky shopping center, the Sadovod market, the Food City complex, and the Ukraina hotel “

The rights to restore the Imperial Orphanage are owned by Betskoy LLC, which bought it in 2017 for 10 billion rubles. There are 33 buildings up for auction, which previously housed the Missile Forces Academy. Six of these buildings are cultural heritage sites. After completion of the work, the total area of ​​the buildings should increase from the existing 113 thousand to 173.7 thousand square meters. m due to apartments, offices and a hotel with 100 rooms.

In 2018, Vanke bought 75% of Betskoy LLC. Another 25% belongs to the structures of Gennady Timchenko, Vedomosti previously reported, citing sources. But the Volga Group, which manages the businessman’s assets, always denied this.

Almost a year ago, the executive director of Betskoy LLC, Kirill Ilyichev, said that the company was considering the possibility of attracting partners to the project (see “Kommersant” dated May 2, 2023). Kommersant’s interlocutors in the industry named all major luxury housing developers, including MR Group, among potential interests. This company then confirmed to Kommersant its interest in the project.

Now the cost of the transaction can be estimated at 25–30 billion rubles, says partner Ricci | M&A Petr Vinogradov. At least another 70 billion rubles. will need to be invested in the implementation of the project, adds Stanislav Ivashkevich Managing Partner of Ivashkevich Hospitality. A year ago, Kirill Ilyichev estimated the total costs of the project at $1 billion (about 80 billion rubles at the exchange rate at that time). Mr. Ivashkevich estimates the payback of the project at 12 years. A Kommersant source in the industry explains such a long period of time by the complexity of the project: firstly, most of the buildings are architectural monuments, and secondly, due to the proximity to the Kremlin, there may be strict regulations for construction work.

However, Timur Ryvkin, director of the residential real estate and land development department at Nikoliers, believes that Kievskaya Ploshchad has experience in implementing such projects. In his opinion, Vanke Group’s exit from the project may be dictated both by the political instability of the last two years, which has led to a decrease in the attractiveness of the project, and by the company’s decision to concentrate on its home region. Against the backdrop of general problems in the Chinese real estate market, Vanke’s net profit decreased by 46% at the end of 2023, to $1.7 billion. In this regard, the group announced plans to reduce its debt by $14 billion in the next two years (see Kommersant Online, March 29).

Stanislav Ivashkevich believes that due to the large number of restrictions as a cultural heritage site, it is advisable to place only a large ultra-luxury hotel with 1 thousand rooms on the site of the Orphanage. The limited supply of such facilities at the Kremlin will allow the cost of living to be high – €600–700 per night, the expert says. But, according to Mr. Ivashkevich, finding a management company for such a hotel will not be easy: Russian operators do not work in this segment, and foreign companies, due to sanctions, are not ready to start new projects in the Russian Federation.

Daria Andrianova, Alexandra Mertsalova


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