To build up everything: is the sea knee-deep in Kyivmiskbud?

To build up everything: is the sea knee-deep in Kyivmiskbud?

The construction business in Ukraine is one of the “dirtiest”: an imperfect corruption system creates many opportunities for breaking the law.

As a result - deceived investors, long-term construction projects, failure to fulfill obligations, construction in inappropriate places...

Officials and law enforcement officers just shrug their shoulders, explaining that they can do nothing. Although all they are required to do is comply with the law.

In addition, square meters in our country are expensive, there are no cheap loans for the population, and the coveted housing remains an unrealizable dream for many Ukrainians.

High-profile scandals related to construction often erupt. Recently, in Kyiv, the Azov civilian corps blocked the entrance to the building of the well-known Kyivmiskbud company because of clashes at a construction site in the Svyatoshyn district that had occurred earlier. According to the activists, the construction is illegal. In response, the company’s management went on strike, calling the incident a raider seizure of the construction site.

At the same time, Kyivmiskbud is known for scandalous buildings not only in Kyiv.

Apartments disguised as hotels

The Kyivmiskbud website has one very interesting project - hotel-type apartments being built in Odesa at 13 Velykyi Fontan, which is actually on the coast.

The developer claims that the buildings are located "in the heart of the city’s coastal zone". The cost of the apartments under construction starts at UAH 29.7 million per square metre, which is just over a thousand US dollars. The advertisement states that a hotel complex is being built on the coastal slopes, but it offers to buy 1,2,3-bed apartments with bedrooms, cosy living rooms, dining areas, bathrooms and kitchens, i.e. flats. A total of 257 apartments are planned to be sold.

In addition, the developer promises a whole range of services: a concierge, internet, parking for 130 cars, a gym, a swimming pool, and a playground. In fact, Kyivmiskbud sells apartments practically on the Black Sea coast (by law, it is forbidden to build housing here), calling the residential building a residential hotel, where the room is sold for permanent use and by the square metre.

So far, the developer has already built three huge multi-storey concrete boxes on the Odesa slopes, cutting down dozens of trees.

Kyivmiskbud also offers to buy parking spaces in the apart-hotel at a cost of UAH 479,250, and non-residential premises at UAH 43,200 per square metre. A 10% discount is promised for 100% payment. The buildings are scheduled to be commissioned on 31 December 2016.

Thus, the cost of a one-bedroom apartment of 58 square metres is just over UAH 2 million, a two-bedroom apartment is UAH 1.85 million, and a three-bedroom apartment will cost almost UAH 3 million.

Who allowed the Kyiv developer to build elite housing in the coastal zone, directly bypassing Ukrainian legislation?

"Kyivmiskbud" or "Kometa-M"?

But Kyivmiskbud not only sells apartments in a residential building under the guise of a hotel. Officially, according to the documents, the developer at the 13th station of Bolshoy Fontan is not a Kyiv company at all, but another enterprise, namely Kometa-M LLC, registered in Odesa in a residential area of the city.

Thus, on March 20, 2007, by decision of the executive committee, following the decision taken at the session of the Odesa City Council, the company “Kometa-M” received a lease on a land plot at the 13th station of Velykyi Fontan with an area of 1.35 hectares for the construction of a 120-bed hotel with a sports, health and cultural and entertainment complex.

The lease term was 3 years and ended in 2009. In return, the city received a fee of 5% of the standard monetary value of the land plot – at that time, just over 126 thousand hryvnia per year (the hryvnia exchange rate in 2007 was about 5 hryvnia per dollar, so Kometa-M paid approximately 25 thousand dollars per year for the 1.35 hectare plot).

Subsequently, after the change of power, the decision to lease the land plot was cancelled by the city council deputies. But in 2013 , the mayor’s office settled with the company , allowing Kometa-M to design and build a hotel on the coastal slopes, although the lease agreement had already expired by that time. The rent for the huge land plot in the elite district of Odesa also remains an open question.

Then the conflict between the city authorities and the enterprise flared up again, then died down: for example, in the summer of 2013, Odesa officials, after an inspection, stated that Kometa-M was carrying out construction work without title documents, violating the law. The decision on the lease was again cancelled in 2014. But Kometa-M did not stop construction, moreover, it filed a lawsuit against the Odesa City Hall and won.

Ultimately, last year it became known that the Odesa company would continue construction on the slopes of the 13th Fountain, since it had won all the court cases, and the Odesa City Council deputies overturned the decision to ban construction, guided by the court decision.

Thus, a company whose legal address leads to an ordinary Odesa apartment received the “green light” to build three elite residential buildings on the coast.

Who is hidden behind the chain of offshore companies?

The State Register of Entrepreneurs reveals that the founder of Kometa-M is the Belizean offshore company Lonard Global LTD. In fact, the ultimate beneficiary of the company is hidden.

This offshore is connected with a number of other enterprises registered in Kyiv. All of them lead to other offshore companies registered in Cyprus, Belize, and the Virgin Islands.

An audit of one of them, LLC Dekoplus, shows that the head of the company since 2014 has been a certain Yuriy Nahornyi, a regional who previously headed the Kremenchug district state administration. He is also involved in several enterprises.

It is noteworthy that the current president of the Kyivmiskbud company, Ihor Kushnir, was a deputy of the Kremenchuk City Council, received higher education in this city, and worked in Kremenchuk for some oil company in the late 90s.

This LLC has already ceased its activities, having folded in 2012. The founders of the company, which was engaged in the retail and wholesale sale of fuel, included a number of companies, including the Kyiv company “Infox”, which belonged to the Yanukovych-era official Mykola Zlochevskyi.

On the other hand, it is obvious that Kometa-M and other affiliated companies are more of a smokescreen. Behind Kometa-M stands PAO Kyivmiskbud, the beneficiary of which is the territorial community of Kyiv. Although it is obvious that this enterprise, which has built up Kyiv and other cities in Ukraine, is clearly not controlled by ordinary Kyiv residents.

Olena Zihulska, for “No corruption!”