MirLand, one of Russia's leading residential and commercial property developers, announces that its wholly-owned subsidiary Petra 8 LLC has entered into a loan agreement with SberBank of Russia for the provision of a line of credit of approximately US $41 million (approx. 30 million).
The purpose of the loan is to finance the construction of 510 apartments, comprising the first phase of MirLand's flagship Triumph Park mixed-use residential development in St. Petersburg.
The loan comprises approximately 70% of the cost of building the first phase of the project and will be provided to Petra in installments over the course of 16 months. The loan is secured by various mortgages, charges, pledges and other customary security interests for the benefit of the Bank and entered into by Petra and the Company. The loan is required to be repaid within three years.
MirLand has also launched a sales campaign for the first phase of Triumph Park which will offer high-quality, competitively priced housing in St. Petersburg's desirable residential market. The project, which is situated on a well located, 40 hectare site, represents one of the few large scale developments in the city to offer close proximity to major transport links.
Furthermore the development will be the first eco-residential complex in St. Petersburg built according to Western standards and will offer attractive features such as ecologically friendly construction materials, an energy efficient design, reduced CO2 emission, water purification filters and high speed eco-home lifts certified according to ISO 14001. The flexibility of the apartment mix in terms of both the range of unit sizes and the fit-out options is designed to appeal to a wide range of purchasers.
The total net sellable area of the first phase of the project is approximately 26,500 m² plus approximately 1,200 m² of retail space and two levels of underground parking providing 194 spaces. Completion of the development of the first phase is planned for Q2 2013.
On completion of the entire development, expected by 2019, Triumph Park will comprise 9,000 apartments, approximately 58,000 m² of retail space, 60,000 m² of offices and a variety of public amenities such as kindergartens, schools and parks.
The project will be marketed by Peterburgskaya Nedvizhimost, the leading agent in the St. Petersburg residential market.
Commenting on the loan and the launch of marketing of Triumph Park, MirLand's Chairman Nigel Wright said: "The provision of construction finance by Sberbank, a premier domestic bank in Russia, for our prestigious St. Petersburg development represents a significant step forward for the project. We are confident that, with their support, we will deliver premium returns for both parties.
"Since the start of the credit crunch three years ago, the availability of domestic bank finance for real estate development in Russia, as elsewhere, has been severely constrained, and we regard this commitment by Sberbank as a vote of confidence not only in this project, but also in the recovering Russian residential real estate market and MirLand's proven ability to deliver projects successfully".
Source: FTI Consulting