Commencement of preparations for construction of residential and business complex in Block 65 - PSP Farman negotiates with potential strategic partners

Construction of a residential-business complex in New Belgrade's Block 65, in which over 170 million euros will be invested by Serbian-Russian company PSP Farman, will commence in January or February 2011, PSP Farman CEO Branislav Grujic announced for eKapija. According to the words of Grujic, the company received the permit for preparation works few days ago. The first out of five phases will include the works on completion of the residential part of the complex, which will comprise a total of 514 residential units. According to the investor's plans, the whole complex should be finished in 2013, which will primarily depend on the pace of recovery of the real estate market in Serbia.

The price of a square meter of apartments in the complex at the corner of Omladinskih Brigada Street and the future route of Inner Ring Road will amount to less than 1,850 euros in the starting phase of procurement, instead of the announced 2,000 euros, Grujic said.

- We are doing our best to maximally optimize the price, which is now made possible thanks to the increase in the Euro exchange rate and the fact that some expenses have remained in dinars and these changes enable us to form the price of EUR 1,850-1,890 EUR for the procurement in the starting phase. The new center of New Belgrade will also have a pedestrian zone with squares and a shopping mall.

According to the architectural solution designed by Fletcher Priest studio from London, the future complex, spanning 152,437 square meters, will also include a business section with 100 outlets and suites at a total surface of 37,058 square meters. Residential facilities will be situated on the side of the block opposite to Omladinskih Brigada Street, while the complex will be dominated by a 39-floor business tower 146 meters high.

- The city authorities have not adopted the study on high-rise buildings yet, which is another reason why the project is running a bit late. It's been over a year since the work on that study began and we have not received the response yet.

(Branislav Grujic)

According to the words of eKapija's interlocutor, the first phase of works will enable employment of about 700 people and minimum 100 people are expected to get jobs in a new company that will be formed to serve the future complex.

PSP Farman interested in strategic partnership

Branislav Grujic said that PSP Farman was interested in entering into a strategic partnership in the project implementation and that it had already negotiated with potential investors.

- We are already negotiating with strategic partners and we are open for different options of investing. So far, we have not established a cooperation with anyone, but even if don't find a company that is willing to become a co-investor, we will resume implementation of the project - Grujic said without explaining the details of potential recapitalization.

The interlocutor of eKapija added that it was most likely that two banks would be included in the project financing.

3,000 people work on projects in Russia

PSP Farman, the company specialized in planning, constructing and equipping buildings, successfully operates in the market of Russia for several years now. According to the words of Grujic, the company has already provided projects for the whole next year.

- The market of Russia is still recovering and it has made an optimistic progress in the last quarter of the year. PSP Farman has already concluded deals for the whole year 2011 and we expect to achieve even better results than this year. We have recently started construction of our large residential complex at over 300,000 square meters on the outskirts of Moscow. Construction of a five-star Intercontinental hotel in Tverska is close to end and we are also working on a 65-floor tower in the center of Moscow, in the vicinity of the Olympic stadium, which will be a part of Radisson Group. Also, we have begun building another residential and business facility in the center of Moscow. In addition, we are intensively working on development of a joint project with Galenika and Russian Farminex for a new pharmaceutical factory in the Kalush region.

The Protocol of intentions between Serbian Galenika, Russian Farminex and PSP Farman on the construction of a pharmaceutical factory was signed in October 2010 and the works are planned to commence in April or May 2011 and end in 2013.

Grujic said that the projects PSP Farman was working on in Russia were worth up to 250 million euros each.

- PSP Farman also develops a young software company in Belgrade that makes software for the management of building projects and we expect to sign an agreement on the management of highly valuable projects in the market of North Africa by the end of the year.

PSP Farman, which employs 2,500 people in Russia and 350 in Serbia, is owned by Arkady Blank (50%) and Branislav Grujic (50%).

T.S.