“Industrial” business style

The chief architect of Moscow, Sergey Kuznetsov participated in the The Moscow Times’ conference “Commercial Real Estate Current Legal and Investment Issues 2014.” One of its key themes were the prospects of developing of the capital’s industrial zones.

To get rid of “dead weight,” a business plan is needed

Vast areas of industrial enterprises for decades have been hanging on the city as a “dead weight”: tremendous job cuts compared with the Soviet period (about 10 times) has led to the use of this real estate and involvement in land turnover markedly worse. As Sergey Kuznetsov pointed out, it is important that the city administration approaches the reorganization of these areas from a business perspective. “This is a good signal that the authorities and businessmen speak the same language and the general task is seen equally,” said Kuznetsov.

Who works — is the one who doesn’t drive

As practice shows, the successful development of industrial zones is always associated with a particular ideology: large sites are difficult to develop without offering the city fully integrated solutions, the panelists noted. Kuznetsov stressed that for the development of urban fabric the mixed-use functionality of future areas is important. First, there must be a large percentage of jobs. It is important to remember that in the model city of the 20th century it was the major industrial areas in particular that attracted working people, and as Moscow continues to live on past trends of master plans, if you simply remove these enclaves serious imbalances will occur. “Actually, they are already occuring in the form of traffic jams,” added Kuznetsov. “People simply did not go to the center in such amounts as now, but the industrial zones ceased to be a magnet, and all the jobs have been concentrated in the center.”

Re-“magnetizing”

That is why in the development of real estate projects it is very important to learn to fulfill the requirements of the city to create a composite function, said the chief architect. Closer cooperation of the city and business (mainly western, emphasized Kuznetsov, as hotel operators are mainly foreign) could be advantageous — the search for corporations that would need a large number of offices, and for an accommodating approach towards planning.

“Housing is possible to build for an abstract buyer, he will still come, but a complicated function of hotels or offices in such a speculative approach is not working on the market now,” said the chief architect.

Sergey Kuznetsov mentioned the International Financial Center in Rublevo-Archangel as an example of a complex approach to designing — a project of integrated development, involving the construction of offices, housing, hotels, commercial and social infrastructure: “It is sensible when the developer requires a certain number of jobs and housing, and it is clear who will occupy them.”

Development of transport routes

Currently Moscow has determined a few priority projects for the development of industrial areas, related mainly to transport. This, for example, is the project for the comprehensive reconstruction of the Small Ring of Moscow’s railroad, on which a large number of industrial zones are strung, as well as the development of the transport artery of the Moscow River and, accordingly, industrial areas adjacent to it in the south-east.

Generally, the south-eastern sector of the capital, according to the chief architect, has considerable potential, but it is quite far behind because of the large percentage of industrial areas: ZIL, “Hammer and Sickle,” and the Karacharovsky mechanical plant form an impenetrable “plug” here and hinder the development of the region.

Particularly about industrial zones

The conversion of industrial zones, however, is not progressing as fast as would be liked — mainly because of the presence of numerous owners of the territories and problems of land consolidation. For example, it is easier with ZIL because there is a single operator with whom it is easy to come to an agreement, Kuznetsov explained. So it is not difficult to divide the territory into lots and to find an investor. Moreover, the first area is already being developed — it’s the Ice Palace. The chief architect evaluates it as “a very good quality sports facility and entire development project as a whole.”

But the south port area, on the contrary, is revealing in its challenges: there are a few large operators and a number of small ones, so now the success of the development of the whole territory depends on the ability to consolidate the owners under a single flag.

Also complicated is going to be the process of combining the owners of what is called the “ArtKvartal” (“Art District”) in the Kurskaya region, reckons Sergey Kuznetsov. In fact, this is also a ruined industrial zone from which it is intended to make a creative modern district, filled with design and architectural offices, art studios, galleries, movie studios, etc.

We are open to suggestions

In any case, today the city is ready to listen very closely to investors who have specific ideas for the development of territories, concluded Sergey Kuznetsov. Especially those who come with their substantive proposals, rather than just asking “let me build something, and then I will somehow sell it.”