VEGAS LEX at PROESTATE-2019
On 18–20 September 2019, the VEGAS LEX law firm participated in the PROESTATE* international investment real estate forum. VEGAS LEX experts acted as speakers at the key conferences of the event and, in the midst of the forum, VEGAS LEX and RGMD held a business breakfast on the topic "Models of Implementation and Mechanisms of Financing of Real Estate Development Projects".
On 18 September 2019, Igor Chumachenko, VEGAS LEX’s Partner and Head of Real Estate, Land & Construction practice, spoke as an external expert at B2C-conference "What comes next? Forecasts of the real estate prices and liquidity", within the framework of which its participants discussed legislative innovations in the real estate market.
Igor Chumachenko drew attention to a wide range of issues that must be resolved due to introduction of an escrow account mechanism. Mr Chumachenko specifically noted: "First of all, it is necessary to proceed from the balance of interests of equity construction investors, on the one hand, and a real estate developer, on the other hand. For example, real estate developers raise the issue of possibility of step-by-step disclosure of escrow accounts similar to the practice established in western countries. Although the State Duma still stands against such disclosure, the Government (Ministry of Construction, Housing and Utilities), however, already works on it; thus, I believe that the mechanism will be ultimately tuned up".
Sergey Palamarchuk, Analytics Director of CIAN GROUP, Yuriy Barsukov, Head of the Marketing Board of Mosrealstroy, Elena Ivankina, President of FIABCI-RUSSIA, D.Sc. Economics, Professor, Head of Department for Property Management and Housing and Utility Sector of the Market Technologies Faculty of the IIM of RANEPA, and Irina Tumanova, Head of the Mortgage and Loans Department of NDV-Realty Supermarket, also took part in the discussion.
On 19 September 2019, within the framework of PROESTATE-2019, the VEGAS LEX law firm, with support from RGMD, held a business breakfast on the topic "Models of Implementation and Mechanisms of Financing of Real Estate Development Projects".
Alexander Garmaev, VEGAS LEX’s Head of Corporate projects group, continued the discussion and disclosed a model Investment Partnership Agreement (IPA) for implementation of real estate development projects in greater detail. Mr Garmaev spoke of specifics of IPA and presented two practicable structural models of an investment partnership both with and without portfolio companies. In his speech, the expert explained the difference of an investment partnership from a general partnership as well as outlined the advantages and disadvantages of IPA as compared to the tried-and-tested model of a joint venture in the form of a JSC/LLC.
Elena Podlesnykh, Director of CBRE’s Department for Investments and Capital Markets, provided the audience with statistics regarding the dynamics of changes in real estate investments for the latest few years, specifically, regarding the volume of investments, changes in the origin and structure of capital as well as investment distribution by regions and real property segments.
Anna Korol, Head of the Bank DOM.RF JSC’s Project Financing Corporate Sales, paid attention in her speech to the changeover to housing financing by means of escrow accounts. The expert explained how the loan interest rates decrease owing to the escrow mechanism and shared information on the status of project financing transactions.
James Corrigan, Managing Director of Sberbank Investments, spoke of the bank’s product line, including its new product "Project Bridge" for developers, and about advantages of cooperation, and shared a number of case studies.
Peter Barsukov, Director of the Finance Department of the Group of Companies "Ingrad", and Dmitry Sobolev, Chief Financial Officer of Century 21 City, also spoke at the event sharing their experience in housing construction by means of the project-financing instrument.
* PROESTATE — is the key event relating to real estate in the Central and Eastern Europe, which unites on its platform over 4,300 industry leaders from 30 countries. The forum has been held since 2007 and constitutes the platform where the main players of real estate market meet. http://www.proestate.pro/o-pro
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