The developer of the project is Otkritie Real Estate. Dmitry Mints, managing director of the private equity division for Otkritie Financial, says the company was not interested in holding the property long. "Our main initiative was to develop and sell these properties," he tells GlobeSt.com.
KanAm will take ownership of the buildings when they are complete in mid-2009. Otkritie officials say in a statement that the actual sales price will be calculated with reference to actual leases signed. Jones Lang LaSalle and Knight Frank have been appointed co-leasing agents for the buildings, which are expected to be fully leased by completion.
The 11-story buildings, located next to the train station that links Moscow with the Domodedovo International Airport, were started more than a year ago. The JV was created "to pioneer foreign investment into the Russian domestic real estate market," according to the statement. "We remain very positive about the Russian market and continue to be very active with our investment and lending business there and across the CIS," says John Nacos, managing director of Deutsche Bank AG. "This transaction is further testament to the ongoing development of the real estate investment market in Russia and the broadening of the investor base there."
KanAm officials said in the statement that it is the right moment to enter "such a promising real estate market." Mints says one reason for Moscow's office market boom is the lack of other supply. "Russia is going to continue to grow and grow, even considering the credit crisis," he says. Vacancy rates hover at around 5% in the city.
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