Valuation Report JSC ‘LSR GROUP’
PORTFOLIO OF 52 REAL ESTATE PROPERTIES IN RUSSIA
ST. PETERSBURG AND LENINGRAD REGION MOSCOW AND MOSCOW REGION YEKATERINBURG
Date of Report: 05.03.2015 Date of Valuation: 31.12.2014 Number of Report: 04.03.2015
PREPARED BY PREPARED ON BEHALF OF Colliers International Ltd. JSC ‘LSR GROUP’
TABLE OF CONTENTS
1. INSTRUCTIONS 4
2. BASES OF VALUATION 8
3. STATUS OF VALUER AND CONFLICTS OF INTEREST 8
4. DISCLOURES AND CONFLICTS OF INTEREST 8
5. COMPLIANCE WITH RICS VALUATION STANDARDS 8
6. ASSUMPTIONS AND SOURCES OF INFORMATION 9
7. CERTIFICATION 9
8. CURRENCY 10
9. VALUATION AND UNCERTAINTY 10
10. ANALYSIS OF INFORMATION CORRECTNESS AND ADEQUACY 10
APPENDIX 1. Assumptions And Definitions 16
APPENDIX 2. Valuation Methodology 22
APPENDIX 3. Property Description 30
1. Commercial Properties. Saint- Petersburg Existings Buildings 31
2. Land Plots For Residential Development. Saint- Petersburg Properties Held For Future Development 39
3. Residential Properties. Saint- Petersburg Properties In The Course Of Development Elite Class Residential 41
4. Commercial Properties. Saint- Petersburg Properties In The Course Of Development 85
5. Country houses. Saint- Petersburg Properties In The Course Of Development 95
6. Commercial Properties. Moscow Existings Buildings 97
7. Residential Properties. Moscow Properties In The Course Of Development Business Class Residential 101
8. Commercial Properties. Moscow Properties In The Course Of Development 122
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9. Residential Properties. Yekaterinburg Properties In The Course Of Development Mass Market Residential 124
APPENDIX 4. MARKET OVERVIEW 137 INVESTMENT CLIMATE 137 OFFICE MARKET OVERVIEW OF SAINT-PETERSBURG 143 ELITE RESIDENTIAL MARKET OVERVIEW OF SAINT- PETERSBURG 148 BUSINESS CLASS RESIDENTIAL MARKET OVERVIEW OF SAINT-PETERSBURG 152 OFFICE MARKET OVERVIEW. MOSCOW 157 REVIEW OF THE RESIDENTIAL PROPERTY MARKET OF MOSCOW, ‘NEW’ MOSCOW AND MOSCOW REGION 167 REVIEW OF THE ELITE RESIDENTIAL PROPERTY MARKET OF MOSCOW 167 REVIEW OF THE BUSINESS-CLASS RESIDENTIAL PPOPERTY MARKET OF MOSCOW 171 REVIEW OF THE ECONOMY-CLASS RESIDENTIAL PPOPERTY MARKET OF MOSCOW 175 REVIEW OF THE RESIDENTIAL PROPERTY MARKET OF ‘NEW’ MOSCOW 176 REVIEW OF THE RESIDENTIAL PPOPERTY MARKET OF MOSCOW REGION 180 REVIEW OF THE RESIDENTIAL PPOPERTY MARKET OF EKATERINBURG 183
P. 3 COLLIERS INTERNATIONAL
Prepared for: 05 March 2015 JSC ‘LSR Group’ For the attention of The Directors
JSC ‘LSR Group’
36, liter Б, 15H, Kazanskaya Street
St. Petersburg, 190031 Russia
Regarding the valuation of 52 real estate properties located in St. Petersburg, Leningrad Region, Moscow, Moscow Region, and Yekaterinburg, Russia
1. INSTRUCTIONS
In accordance with valuation agreement # 224/11-14 dated December 29, 2014 (hereinafter referred to as “Agreement”) between LSR Group Joint Stock Company (hereinafter referred to as “Client”) and Colliers International Ltd. (hereinafter referred to as “Company”), whereas all services, entrusted to the Company by the Client with the Agreement and appearing to be the subject of the Agreement, are rendered by employees of the Company (hereinafter referred to as “Appraiser”, “Appraisers”), Appraiser estimated the market value of 53 real estate properties located at St. Petersburg and the Leningrad Region, Moscow and the Moscow Region, Yekaterinburg, Russia (hereinafter referred to as – «Subject Properties», «Properties»).
The valuation date is 31 December 2015. The properties were inspected by the Appraisers in the period of January 20-24, 2015.
This valuation is prepared for the purpose of annual management reporting (annual statement) and can be used for no other purpose.
The properties that are the subject of this Valuation Report, each a “Property” and together the “Properties” are listed as follows:
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Presold / Breakdown of areas (unsold / unleased net area), sq m Net Net Estimat preleased Constru sellable / unsold / ed of net ction Site Gross leasable unleased comple Project sellable / N start Development Development Project Address Area, buildable area, excl. net area, tion completion, leasable Tenure o date strategy ha area, sq m car excl. car Residential Offices Retail Other Parking, lots date % areas, (month / parking, parking, (month excl. car year) sq m sq m / year) parking, %
Saint Petersburg & the Leningrad Region
Existing buildings
Commercial properties
1 Kazanskaya 36 Kazanskaya street, 36 0,25 7 434,00 4 764,40 4 764,40 completed 100% 0% Freehold Hold 2 Zolotaya Kazanskaya Kazanskaya street, 44 0,15 3 060,60 2 677,20 2 677,20 completed 100% 0% Freehold Hold Litera A, 39, Kirochnaya 3 Paradniy Quarter BC 11 9,57 3 806,30 2 558,60 2 558,60 completed 100% 0% Freehold Hold Street 4 Kazanskaya 60 Litera A, 18, Fonarny Line 2 212,80 2 027,46 2 027,46 completed 100% 0% Freehold Hold Total existing buildings 12 028 Properties held for future
development
Land plots for residential development
Ruch`I Tsvetnoy Gorod Piskarevskiy Avenue , 145 429,29 5 458 098 2 960 380 2 960 380 2 509 690 450 690 0 0 25 686 Jan-16 Dec-24 4% 0% Freehold Build and Sell 5
Total Properties held for future development 2 960 380
Properties in the course of
development
Elite class residential
6 Smolniy Park Smolnogo St., bld. 4, lit. A 8,65 169 642 99 807 37 020 26 511 10 508 0 0 693 Jun-10 Dec-16 80% 63% Leasehold Build and Sell -
Phase 1, bldgs. Б1 38 231 25 653 1 361 1 361 0 0 0 41 Jun-10 Jul-12 100% 95% Leasehold Sell
8,65 Phase 2, bldgs. Б2,5,6 - 40 032 24 503 6 151 5 139 1 012 0 0 123 Mar-12 Dec-14 100% 75% Leasehold Sell Phase 3, bldgs. Б8,9,10,12,13 - 49 844 22 740 4 011 4 011 0 0 0 415 Nov-12 Dec-15 76% 82% Leasehold Build and Sell Phase 4, bldgs. Б3,4,7,11,14 - 41 535 26 910 25 496 16 000 9 496 0 0 114 Nov-13 Dec-16 52% 5% Leasehold Build and Sell 7 Paradniy Quarter (residential) Paradnaya St., 1-3 9,57 118 925 64 906 816 762 54 0 0 258 Jul-10 Mar-14 100% 99% Federal ownership Sell Phase 3, bldgs 6,7 60 316 33 491 54 0 54 0 0 113 Jul-10 Oct-12 100% 100% Federal ownership Sell 9,57 Phase 3, bldgs. 4,5,8 58 609 31 415 762 762 0 0 0 145 Aug-11 Mar-14 100% 98% Federal ownership Sell 8 Radisheva 39 Radisheva St., 39 liter M 0,85 31 923 20 818 1 752 1 199 553 0 0 45 Feb-13 Aug-15 79% 92% Freehold Build and Sell 9 Verona Morskoy prospect, 29, lit. A 0,36 20 830 11 749 8 608 7 057 1 325 0 227 111 Jan-15 Aug-17 32% 27% Freehold Build and Sell 10 Kovenskiy 5 Kovenskiy lane, 5 0,39 12 324 5 871 174 174 0 0 0 6 Jun-11 Apr-13 100% 97% Leasehold Sell 11 Dom na Dvoryanskoy Kuybisheva street, 13 liter B 0,19 8 787 6 386 2 134 2 134 0 0 0 35 Feb-13 May-15 75% 67% Freehold Build and Sell 12 Russkiy Dom Korolenko St., 5, 5A 2,40 93 725 54 788 54 614 48 947 5 668 0 0 485 Mar-15 Jan-19 2% 0% Freehold Build and Sell
Business class residential
Litera Ж, 10, Medikov 13 Europa City 7,36 135 554 84 456 57 733 55 287 2 446 - 0 492 Mar-12 Nov-16 53% 32% Freehold Build and Sell Avenue, Petrogradsky District Phase 3 70 109 42 911 21 406 20 445 961 0 0 303 Mar-12 Nov-15 64% 50% Freehold Build and Sell
Phase 4 65 445 41 545 36 327 34 843 1 485 0 0 189 Apr-13 Nov-16 41% 13% Freehold Build and Sell P. 5 COLLIERS INTERNATIONAL
N Site Gross Net Net Constru Estimat Project Presold / Development Development Project Address Breakdown of areas (unsold / unleased net area), sq m Tenure o Area, buildable sellable / unsold / ction ed completion, preleased strategy 14 Tri Vetra 151, Savushkina Street, 3,05ha area,108 246sq m leasable53 850 unleased53 850 52 684 1 166 0 0 703 Julstart-13 compleDec-18 13%% of0% net Investment contract Build and Sell 15 Smolenskaya 14 14, Smolenskaya Street 0,69 34 352 area,23 090 excl. net23 area,090 22 440 650 0 0 251 Aprdate-15 Jantion-18 17% sellable0% / Freehold Build and Sell car excl. car (month / date leasable Mass market residential parking, parking, year) (month areas, sq m sq m / year) excl. car Doblesti Street, Quarter 28, 16 Yuzhnaya Aquatoriya 23,90 523 065 310 766 168 101 152 999 15 102 0 0 2 483 Nov-12 Dec-18 29% parking,46% Leasehold Build and Sell 28A % Phase 1 39 004 4 595 4 595 0 0 0 300 Feb-13 Dec-16 41% 88% Leasehold Build and Sell
Phase 2 62 877 1 702 1 580 122 0 0 600 Nov-12 Mar-16 66% 97% Leasehold Build and Sell
Phase 3 25 000 25 000 25 000 0 0 0 300 Feb-15 Dec-18 11% 0% Leasehold Build and Sell
Phase 4 23,90 56 548 49 169 46 339 2 830 0 0 331 Jul-14 Jan-18 15% 13% Leasehold Build and Sell
Phase 5 12 000 1 868 893 976 0 0 52 Jun-14 Jan-18 17% 84% Leasehold Build and Sell
Phase 6 83 830 83 830 72 655 11 175 0 0 600 Sep-14 Dec-18 13% 0% Leasehold Build and Sell
Phase 7 31 507 1 937 1 937 0 0 0 300 Jan-14 Dec-17 37% 94% Leasehold Build and Sell
17 Aurora 9A, Belysheva Street 15,00 415 033 256 071 933 469 464 0 0 0 Jul-11 Jun-14 100,0% 99,6% Leasehold Sell 18 Sophia 47, 55, 59, Yuzhnoe Highway 21,90 466 416 311 430 124 795 122 576 2 219 0 0 1 576 Mar-13 Dec-17 55% 60% Freehold Build and Sell 19 Kalina Park 12, Marshala Blukhera 34,45 544 700 335 917 240 780 239 053 1 728 0 0 1 176 Feb-12 Dec-18 43,5% 28% Freehold Build and Sell Litera D, 3, Moskovskoe 20 Viva 9,15 148 064 102 984 13 026 12 358 668 0 0 236 May-12 Jun-17 85% 87% Freehold Build and Sell Highway, 21 Kvartet 27, Dunaysky Avenue 6,17 155 863 109 570 18 284 18 284 0 0 0 504 Nov-12 Dec-16 47,5% 83% Freehold Build and Sell 22 Shuvalovskiy Parashutnaya Street 30,90 680 716 422 134 347 824 345 377 2 447 0 0 2 455 Jul-14 Dec-20 10% 18% Freehold Build and Sell 23 Novaya Okhta Murinskaya Road 104,74 1 241 545 794 577 469 220 458 657 10 564 0 0 5 772 Sep-12 Dec-18 38,6% 41% Freehold Build and Sell 24 Ruchyi-7 Piskarevskiy Avenue , 145 23,66 282 321 211 421 211 421 209 435 1 986 0 0 2 546 Feb-16 Dec-18 1% 0% Freehold Build and Sell 25 Zapovednaya 20,60 298 727 209 109 209 109 209 109 0 0 0 1 892 Sep-15 Jul-18 18,9% 0% Freehold Build and Sell 26 Aeroport Rzhevka 175,00 1 637 974 1 146 582 1 146 582 1 146 582 0 0 0 0 Jul-16 Oct-25 5% 0% Freehold Build and Sell 40-42, Oktyabrskaya 27 Oktyabrskaya Naberezhnaya 59,53 1 329 981 823 724 823 724 807 880 15 844 0 0 4 230 Feb-16 Dec-25 0,2% 0% Freehold Build and Sell Embankment Oktyabrskaya Naberezhnaya Rudas 31 701 793 431 231 431 231 420 837 10 394 0 0 2 475 Feb-16 Dec-25 0% 0% Freehold Build and Sell
Oktyabrskaya Naberezhnaya Barrikada 29 628 188 392 493 392 493 387 043 5 450 0 0 1 755 Feb-16 Oct-24 0% 0% Freehold Build and Sell
Commercial properties
28 Nevskiy 68 68, Nevsky Avenue 0,15 8 614 5 935 5 935 3 631 0 0 2 304 26 Dec-10 Dec-12 95% 0% Leasehold Sell 29 Nevskiy 1 1, Nevsky Avenue 0,25 9 709 7 181 7 181 5 071 0 0 2 109 21 Jan-16 Dec-18 21% 0% Freehold Build and Sell 30 Fontanka 3 0,19 8 772 5 316 5 316 4 619 0 0 697 45 Jul-15 Oct-16 48% 0% Leasehold Build and Sell 31 Paradniy Quarter, bldgs. 17, 18 1-3, Paradnaya Street 9,57 12 048 12 048 12 048 0 12 048 0 0 0 Oct-12 May-14 100% 0% Federal ownership Build and Sell 58-60, Kamenoostrovskiy 32 Kamenoostrovskaya Kollektsiya 0,83 7 866 7 866 7 866 0 7 866 0 0 0 Jan-15 Dec-16 18% 0% Leasehold Build and Sell Avenue
Country houses
33 Repino-Leninskoe 75,84 0 758 417 758 417 0 0 0 758 417 0 Feb-11 Dec-15 87% 0% Freehold Sell Leninskoye settlement, Phase 3 - Bolshoy Alakul 75,84 0 758 417 758 417 0 0 0 758 417 0 Feb-11 Dec-15 87% 0% Freehold Sell Leningrad Region Total Properties in the cource of development 4 810 352
Moscow & the Moscow Region
Existing buildings Commercial properties
34 Davydkovskaya Davydkovskaya Street, 16 1,1358 41 819,0 19 090 1 737 1 737 - - 6 completed 100% 100% Freehold Hold 35 Tverskoy Boulevard 16 16, Tverskoy Boulevard 0,14 4 844 2 651 2 651 completed 100% 100% Leasehold Hold Total existing properties 4 388
Properties in the course of
development
Business class residential
bld. 14, 21, 58 36 Leningradskoe shosse 58 1,77 80 202 36 880 36 880 26 046 10 834 0 0 664 Sep-15 Dec-17 19% 0% Freehold Build and Sell Leningradskoye Highway 37 Donskoy Olimp 19, Serpukhovsky Val Street 4,72 239 050 85 316 53 945 45 529 4 716 0 3 701 1 125 May-13 Dec-16 47% 37% Freehold Build and Sell 38 Grunvald Zarechye Settlement, the 4,10 58 331 27 260 2 755 1 104 593 0 1 058 113 Mar-05 Jan-11 99% 90% Freehold Build and Sell
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N Site Gross Net Net Constru Estimat Project Presold / Development Development Project Address Breakdown of areas (unsold / unleased net area), sq m Tenure o Area, buildable sellable / unsold / ction ed completion, preleased strategy Odintsovo District of the ha area, sq m leasable unleased start comple % of net Moscow Region area, excl. net area, date tion sellable / 39 ZiL 23, Avtozavodskaya Street 65,09 1 458 797 951car 753 excl.951 753 car 760 070 191 683 0 0 12 936 (monthJul-15 / Decdate-23 3% leasable0% Leasehold Build and Sell parking, parking, year) (month areas, Mass market residential sq m sq m / year) excl. car parking, 40 Vzlet 6, Proizvodstvennaya Street 39,62 1 000 000 470 459 470 459 344 132 126 327 0 0 5 500 Sep-15 Sep-21 3% 0%% Freehold/Leasehold Build and Sell Bachurino Village, the 41 iBitsa settlement of Sosenskoye, the 59,85 571 363 280 766 280 766 208 705 - 68 000 4 061 3 086 Mar-15 Nov-20 2% 0% Leasehold Build and Sell Novomoskovsky AD, Moscow Phase 1 41 255 26 477 26 477 26 152 325 Mar-15 Feb-17 Leasehold Build and Sell
Phase 2 171 573 68 884 68 884 67 583 1 301 1 598 Jan-16 Nov-17 Leasehold Build and Sell
Phase 3 59,85 120 295 65 654 65 654 64 408 1 246 Sep-17 Aug-19 Leasehold Build and Sell
Phase 4 138 241 51 751 51 751 50 563 1 189 1 488 Sep-18 Jun-20 Leasehold Build and Sell
Phase 5 100 000 68 000 68 000 - - 68 000 - - Jul-18 Nov-20 Leasehold Build and Sell
Near the Salkovo Village, the Ryazanovskoye Settlement, 42 Podolsk-Erino 97,80 900 720 358 800 358 800 303 600 6 900 48 300 0 4 112 Aug-16 Dec-22 0% 0% Freehold Build and Sell the Novomoskovsky AD, Moscow the Zapadny Microdistrict of 43 Novoe Domodedovo the Domodedovo, the 39,33 564 517 315 721 72 870 67 678 5 192 0 0 0 Aug-11 Dec-16 69% 77% Freehold/Leasehold Build and Sell Moscow Region near the Chernaya Village, the Pavlovo-Posadskoye 44 Novoe Nakhabino 15,30 70 503 40 840 3 955 3 141 130 0 683 - Oct-10 Dec-15 94% 90% Freehold Build and Sell Settlement, the Istra District of the Moscow Region near the Chernaya Village, the Pavlovo-Posadskoye 45 Nakhabino Yasnoe 29,05 182 967 143 066 107 573 104 247 3 326 0 0 300 Dec-12 Sep-16 47% 25% Freehold Build and Sell Settlement, the Istra District of the Moscow Region
Commercial properties
bld. 1, 2, 3, 9 46 Noviy Balchug 0,40 24 815 12 099 12 099 7 731 4 368 170 Apr-14 Jun-19 46% 0% Leasehold Build and Sell Sadovnicheskaya Street Total Properties in the cource of development 2 351 855
Yekaterinburg
Properties in the course of
development
Mass market residential
40-Letiya Komsomola Street, 47 Rassvetniy 9,83 253 829 181 449 145 722 145 722 0 0 0 0 Feb-14 Sep-19 11% 20% Freehold Build and Sell 2B 48 Khrustalniye Klyuchi Latviyskaya Street 11,02 293 131 217 043 204 425 203 247 1 178 0 0 1 269 Apr-14 Sep-19 0% 6% Leasehold Build and Sell 49 Michurinskiy Sukhodolskaya Street 46,92 224 090 216 109 171 770 171 200 570 0 0 297 Jan-13 Dec-17 25% 21% Freehold Build and Sell 50 Novgorodtsevoy Novgorodtsevoy Street, 25 0,88 19 940 12 490 2 919 2 547 110 170 92 0 Jan-14 Jul-15 68% 77% Freehold Build and Sell A quadrant formed by Rastochnaya, Kunarskaya, 51 Rastochnaya 0,54 13 922 9 325 9 325 9 325 0 0 0 50 Apr-15 Dec-16 12% 0% Freehold Build and Sell Kishinevskaya and Bilimbaevskaya Streets The quarter formed by 52 Flagman Repina, N.Vasil’eva and 3,39 111 748 70 000 70 000 64 626 5 374 0 0 653 Apr-15 Sep-18 6% 0% Freehold /Leasehold Build and Sell Zavodskaya Streets Total Properties in the cource of development 604 160
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Prepared for: JSC ‘LSR Group’ 2. BASES OF VALUATION
The Report has been prepared in conformity with the requirements of:
International Valuation Standards, Eight Edition;
RICS Valuation –Professional Standards (January 2014).
In conformity with the Royal Institution of Chartered Surveyors Standards (RICS), Incorporating the IVSC International Valuation Standards the market value is defined as follows:
“the estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing seller in an arm’s length transaction, after proper marketing and where the parties had each acted knowledgeably, prudently and without compulsion” 3. STATUS OF VALUER AND CONFLICTS OF INTEREST
The properties have been valued by suitably qualified surveyors who fall within the requirements as to competence as set out in VS 1.5 and 1.6 of the RICS Valuation - Professional Standards (incorporating the International Valuation Standards) March 2012 (the ‘Red Book’) issued by the Royal Institution of Chartered Surveyors (the ‘RICS’) and who are valuers registered in accordance with the RICS Valuer Registration Scheme (‘VRS’). We confirm that we have undertaken the valuations acting as External Valuers, qualified for the purpose of this valuation. 4. DISCLOURES AND CONFLICTS OF INTEREST
We confirm that Colliers International complies with the requirements of independence and objectivity under VS 1.7 and that we have no conflict of interest in acting on the Company’s behalf in this matter.
We can confirm as follows:
Unless otherwise advised in this report, Colliers International has no other current or recent fee earning relationship with the borrower. 5. COMPLIANCE WITH RICS VALUATION STANDARDS
We confirm that the valuations have been made in accordance with the appropriate sections of the Valuation Standards (‘VS’) contained within the ‘Red Book’ prepared by the ‘RICS’. This is an internationally accepted basis of assessing the value of real estate.
СТР. 8 COLLIERS INTERNATIONAL
Prepared for: The International Valuation Standards Council (IVSC) publishes and periodically JSC ‘LSR Group’ reviews International Valuation Standards (IVS), which set out internationally accepted, high level valuation principles and definitions. These have been adopted and supplemented by the RICS, and are reflected in Red Book editions. Thus, the RICS considers that a valuation that is undertaken in accordance with the Red Book will also be compliant with IVS.
Colliers International is registered for regulation by RICS and operates a Complaints Handling Procedure, a copy of which is available upon request. As part of the RICS monitoring regime, any valuation may be subject to monitoring under the RICS’s conduct and disciplinary regulations. 6. ASSUMPTIONS AND SOURCES OF INFORMATION
An Assumption is stated in the glossary to the Red Book to be a ‘supposition taken to be true’ (‘Assumption’). Assumptions are facts, conditions or situations affecting the subject of, or approach to, a valuation that, by agreement, need not be verified by a valuer as part of the valuation process. In undertaking our valuations, we have made a number of Assumptions and have relied on certain sources of information. Where appropriate, the Company has confirmed that our Assumptions are correct so far as they are aware. In the event that any of these Assumptions prove to be inaccurate or incorrect then our valuation should be reviewed. 7. CERTIFICATION
We certify that, to the best of our knowledge and belief:
1. The statements of facts contained in this Report are true and correct.
2. The reported analysis, opinions and conclusions are limited only by the reported assumptions and limiting conditions, and presents our personal, unbiased professional analyses, opinions, and conclusions.
3. Neither the Company, nor the Appraiser has any present or prospective interest in the property, which is the subject of this Report, and we have no personal interest or bias with respect to the parties involved.
4. The Appraiser’s and/or the Company’s compensation is not contingent on an action or event resulting from the analyses, opinions, or conclusions in, or the use of, this Report.
5. The Appraiser’s and/or the Company’s compensation is not contingent upon the reporting of a predetermined value or direction in value that favors the cause of the Client, the amount of the value estimate, the attainment of a stipulated result, or the occurrence of a subsequent event.
СТР. 9 COLLIERS INTERNATIONAL
Prepared for: 6. The inspections of the Properties were made in the period of October, 20-24, JSC ‘LSR Group’ 2014. 8. CURRENCY
The properties have been valued in Rubles. 9. VALUATION AND UNCERTAINTY
The deteriorating economic situation in Russia in 2014 has caused a number of unexpected consequences in the real estate market. In particular:
- increased cost of debt financing in Roubles
- limited finance in foreign currencies
- reduced levels of liquidity of real estate
- transaction levels are affected
- falling demand to lease space
As a result of the reduced levels of liquidity and transaction activity, there is limited market evidence available as regards market rents and pricing.
The opinion of value as at the date of valuation is driven significantly by valuation sentiment, rather than as a result of direct evidence, meaning that there is generally less certainty in arriving at valuations around the date of valuation. 10. ANALYSIS OF INFORMATION CORRECTNESS AND ADEQUACY
According to the RICS Valuation – Professional Standards the Appraiser must perform an analysis of correctness and adequacy of information used in the valuation process.
Information is considered to be adequate if use of additional information results neither in significant changes in characteristics used in valuation of the property nor in significant changes in the total value of the property.
Information is considered to be correct if it represents the real facts and allows the user of the valuation report to make right conclusions about the characteristics used by the appraiser in the value analysis and determination of the total value of the Subject Property and to make reasonable decisions based on these conclusions.
The Client provided all the data required for estimation of the market value of the Subject Property. The information used by the Appraiser can be considered adequate and correct.
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Prepared for: The market value of the Properties as at 31 December 2014 can be reasonably JSC ‘LSR Group’ estimated at (rounded):
СТР. 11 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’
Market Value of No Development Project Address 100% ownership, RUB 2014
Saint Petersburg & the Leningrad Region
Existing buildings
Commercial properties
1 Kazanskaya 36 Kazanskaya street, 36 662 704 000 2 Zolotaya Kazanskaya Kazanskaya street, 44 286 171 000 3 Paradniy Quarter BC 11 Litera A, 39, Kirochnaya Street 463 569 000 4 Kazanskaya 60 Litera A, 18, Fonarny Line 207 165 000 1 619 609 000 Total existing buildings
Properties held for future development
Land plots for residential development
8 986 357 000 5 Ruch`I Tsvetnoy Gorod Piskarevskiy Avenue , 145
8 986 357 000 Total Properties held for future development
Properties in the course of development
Elite class residential
6 Smolniy Park Smolnogo St., bld. 4, lit. A 8 064 210 000 Phase 1, bldgs. Б1 - 404 158 000 Phase 2, bldgs. Б2,5,6 - 1 888 466 000 Phase 3, bldgs. Б8,9,10,12,13 - 2 674 238 000 Phase 4, bldgs. Б3,4,7,11,14 - 3 097 348 000 7 Paradniy Quarter (residential) Paradnaya St., 1-3 723 072 000 Phase 3, bldgs 6,7 263 927 000 Phase 3, bldgs. 4,5,8 459 145 000 8 Radisheva 39 Radisheva St., 39 liter M 1 215 999 000 9 Verona Morskoy prospect, 29, lit. A 2 160 830 000 10 Kovenskiy 5 Kovenskiy lane, 5 260 648 000 11 Dom na Dvoryanskoy Kuybisheva street, 13 liter B 393 535 000
12 Russkiy Dom Korolenko St., 5, 5A 1 094 501 000
Business class residential
Litera Ж, 10, Medikov Avenue, Petrogradsky 13 Europa City 4 900 424 000 District Phase 3 2 583 359 000 Phase 4 2 317 065 000
14 Tri Vetra 151, Savushkina Street, 804 185 000
15 Smolenskaya 14 14, Smolenskaya Street 561 054 000
Mass market residential
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Prepared for: JSC ‘LSR Group’
Market Value of No Development Project Address 100% ownership, RUB 2014 16 Yuzhnaya Aquatoriya Doblesti Street, Quarter 28, 28A 4 250 064 000 Phase 1 42 260 000 Phase 2 397 355 000 Phase 3 578 987 000 Phase 4 1 737 893 000 Phase 5 11 221 000 Phase 6 1 767 168 000 Phase 7 -284 820 000 17 Aurora 9A, Belysheva Street 127 308 000 18 Sophia 47, 55, 59, Yuzhnoe Highway 5 503 572 000 19 Kalina Park 12, Marshala Blukhera 10 601 142 000 20 Viva Litera D, 3, Moskovskoe Highway, 875 590 000 21 Kvartet 27, Dunaysky Avenue 322 233 000
22 Shuvalovskiy Parashutnaya Street 2 996 130 000
23 Novaya Okhta Murinskaya Road 6 180 207 000
24 Ruchyi-7 Piskarevskiy Avenue , 145 1 636 444 000
25 Zapovednaya 2 145 434 000
26 Aeroport Rzhevka 2 201 966 000
27 Oktyabrskaya Naberezhnaya 40-42, Oktyabrskaya Embankment 5 050 755 000 Oktyabrskaya Naberezhnaya Rudas 2 542 604 000 Oktyabrskaya Naberezhnaya Barrikada 2 508 151 000 Commercial properties
28 Nevskiy 68 68, Nevsky Avenue 3 139 400 000
29 Nevskiy 1 1, Nevsky Avenue 1 796 300 000
30 Fontanka 3 1 588 700 000 31 Paradniy Quarter, bldgs. 17, 18 1-3, Paradnaya Street 1 333 911 000 32 Kamenoostrovskaya Kollektsiya 58-60, Kamenoostrovskiy Avenue 157 800 000 Country houses
33 Repino-Leninskoe 216 800 000 Phase 3 - Bolshoy Alakul Leninskoye settlement, Leningrad Region 216 800 000 70 302 214 000 Total Properties in the cource of development
Moscow & the Moscow Region
Existing buildings
Commercial properties
34 Davydkovskaya Davydkovskaya Street, 16 315 246 000 35 Tverskoy Boulevard 16 16, Tverskoy Boulevard 1 229 986 000 1 545 232 000 Total existing properties
Properties in the course of development
СТР. 13 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’
Market Value of No Development Project Address 100% ownership, RUB 2014 Business class residential
36 Leningradskoe shosse 58 bld. 14, 21, 58 Leningradskoye Highway 1 703 687 000
37 Donskoy Olimp 19, Serpukhovsky Val Street 7 578 438 000 Zarechye Settlement, the Odintsovo District of 38 Grunvald 541 739 000 the Moscow Region 39 ZiL 23, Avtozavodskaya Street 19 528 755 000 Mass market residential
40 Vzlet 6, Proizvodstvennaya Street 6 981 849 000
Bachurino Village, the settlement of 41 iBitsa 4 991 658 000 Sosenskoye, the Novomoskovsky AD, Moscow Phase 1 470 734 350 Phase 2 1 224 662 789 Phase 3 1 167 240 570 Phase 4 920 067 841 Phase 5 1 208 952 452 Near the Salkovo Village, the Ryazanovskoye 42 Podolsk-Erino 1 368 665 000 Settlement, the Novomoskovsky AD, Moscow the Zapadny Microdistrict of the Domodedovo, 43 Novoe Domodedovo 603 241 000 the Moscow Region near the Chernaya Village, the Pavlovo- 44 Novoe Nakhabino Posadskoye Settlement, the Istra District of the 137 052 000 Moscow Region near the Chernaya Village, the Pavlovo- 45 Nakhabino Yasnoe Posadskoye Settlement, the Istra District of the 2 677 123 000 Moscow Region Commercial properties
1 900 880 000 46 Noviy Balchug bld. 1, 2, 3, 9 Sadovnicheskaya Street
48 013 087 000 Total Properties in the cource of development
Yekaterinburg Properties in the course of development
Mass market residential
47 Rassvetniy 40-Letiya Komsomola Street, 2B 993 413 000 48 Khrustalniye Klyuchi Latviyskaya Street 906 646 000 49 Michurinskiy Sukhodolskaya Street 2 222 765 000 50 Novgorodtsevoy Novgorodtsevoy Street, 25 18 821 000 A quadrant formed by Rastochnaya, 51 Rastochnaya Kunarskaya, Kishinevskaya and Bilimbaevskaya 106 132 000 Streets The quarter formed by Repina, N.Vasil’eva and 52 Flagman 436 902 000 Zavodskaya Streets Total Properties in the cource of development 4 684 679 000 GRAND TOTAL PORTFOLIO 135 151 178 000
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Prepared for: JSC ‘LSR Group’
Should you have any questions, please, contact us.
Regards,
Dmitry Romanov, MRICS Vladislav Semenov, MRICS
______Regional Director Director Valuation Department Valuation Department Moscow St Petersburg
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Prepared for: JSC ‘LSR Group’ APPENDIX 1. ASSUMPTIONS AND DEFINITIONS
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Prepared for: STANDARTS AND BASES OF VALUATION JSC ‘LSR Group’ The valuation has been prepared in accordance with one or more of the following standards:
The RICS Valuation – Professional Standards (Incorporating the International Valuation Standards) January 2014 prepared by the Royal Institution of Chartered Surveyors (RICS). Whereby the valuation has been prepared by a suitably qualified valuer, who fall within the requirements as to competence as set out in PS 2.3 of the Red Book.unless any variations have been specifically referred to under the heading “Special Remarks”
The International Valuation Standards 2013 issued by the International Valuation Standards Council (IVSC)
MARKET VALUE Where we have been instructed to value the property on the basis of Market Value, we have done so in accordance with VS 3.2 of the Professional Standards issued by The Royal Institution of Chartered Surveyors, which is defined as follows:
‘The estimated amount for which an asset or liability should exchange on the date of valuation between a willing buyer and a willing seller in an arm’s-length transaction after proper marketing and where the parties had each acted knowledgeably, prudently and without compulsion’.
The interpretative commentary on Market Value, as published in International Valuation Standards, has been applied.
FAIR VALUE Valuations based on Fair Value shall adopt one of the two definitions in accordance with VS 3.5 of the Professional Standards.
1. The definition adopted by International Valuation Standards Council (IVSC)
‘The estimated price for the transfer of an asset or liability between identified knowledgeable and willing parties that reflects the respective interests of those parties’. 2. The definition adopted by the International Accounting Standards Board (IASB)
‘The price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date’.
It is important to recognise that the two definitions of Fair Value are not the same. Valuations prepared for financial reporting purposes under IFRS require the adoption of the IASB definition and IFRS 13 will apply.
The guidance in IFRS 13 includes:
‘The objective of a fair value measurement is to estimate the price at which an orderly transaction to sell the asset or to transfer the liability would take place between market participants at the measurement date under current market conditions. A fair value measurement requires an entity to determine all the following:
(a) the particular asset or liability that is the subject of the measurement (consistently with its unit of account) P. 17 COLLIERS INTERNATIONAL
Prepared for: (b) for a non-financial asset, the valuation premise that is appropriate for the JSC ‘LSR Group’ measurement (consistently with its highest and best use)
(c) the valuation technique(s) appropriate for the measurement, considering the availability of data with which to develop inputs that represent the assumptions that market participants would use when pricing the asset or liability and the level of the fair value hierarchy within which the inputs are categorised.
The references in IFRS 13 to market participants and a sale make it clear that for most practical purposes, Fair Value is consistent with the concept of Market Value.
MARKET RENT Valuations based on Market Rent, as set out in VS 3.3 of the Professional Standards; adopt the definition as settled by the IVSC which is as follows:
‘The estimated amount for which a property would be leased on the valuation date between a willing lessor and a willing lessee on appropriate lease terms in an arm’s length transaction, after proper marketing and where the parties had each acted knowledgeably, prudently and without compulsion.’
Market Rent will vary significantly according to the terms of the assumed lease contract. The appropriate lease terms will normally reflect current practice in the market in which the property is situated, although for certain purposes unusual terms may need to be stipulated. Matters such as the duration of the lease, the frequency of rental changes, and the responsibilities of the parties for maintenance and outgoings, will all impact on Market Rent. In certain states, statutory factors may either restrict the terms that may be agreed, or influence the impact of terms in the contract. These need to be taken into account where appropriate. The principal lease terms that are assumed when providing Market Rent will be clearly stated in the report.
Market Rents are provided for the purpose described in this report and are not to be relied upon by any third party for any other purpose.
RENTAL ASSESSMENT Unless stated otherwise within the report, our valuation has been based upon the assumption that the rent is to be assessed upon the premises as existing at the date of our inspection.
PURCHASE AND SALE COSTS Where Purchase and/or Sale Costs have been allowed for within our opinion of value we have stated these within our report.
MEASUREMENTS We have not carried out a measured survey and have relied upon the areas supplied to us by the Client or their representatives. We have assumed that these areas are correct and have been measured in accordance with local market conditions.
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Prepared for: CONDITION JSC ‘LSR Group’ Unless otherwise stated within the report, we have not carried out a building survey, nor have we inspected the woodwork or other parts of the structures which are covered, unexposed or inaccessible and we are, therefore, unable to report that such parts of the properties are free from rot, beetle or other defects.
Where we have noticed items of disrepair during the course of our inspections, they have been reflected in our valuations, unless otherwise stated.
We have assumed that none of the materials commonly considered deleterious are included within the properties. These include, inter alia, the following:
High alumina cement concrete
Asbestos
Calcium chloride as a drying agent
Wood wool slabs on permanent shuttering
Polystyrene and polyurethane used as insulation in cladding
None of the services, drainage or service installations was tested and we are, therefore, unable to report upon their condition.
ENVIRONMENTAL MATTERS Unless otherwise stated within the report, we have not carried out soil, geological or other tests or surveys in order to ascertain the site conditions or other environmental conditions of the property. Unless stated to the contrary within the report, our valuation assumes that there are no unusual ground conditions, contamination, pollutants or any other substances that may be environmentally harmful.
FIXTURES AND FITTINGS In arriving at our opinions of value we have disregarded the value of all process related plant, machinery, fixtures and fittings and those items which are in the nature of tenants’ trade fittings and equipment. We have had regard to landlords’ fixtures such as lifts, escalators, central heating and air conditioning forming an integral part of the buildings.
Where the property is valued as an operational entity and includes the fixtures and fittings, it is assumed that these are not subject to any hire purchase or lease agreements or any other claim on title. No equipment or fixtures and fittings have been tested in respect of any electrical equipment regulations or gas safety regulations and we assume that where appropriate all such equipment meets the necessary local legislation. Unless otherwise specifically mentioned the valuation excludes any value attributable to plant and machinery.
TENURE, LETTINGS AND REPORTS ON TITLE AND/OR TENANCIES Unless otherwise stated, we have not inspected the title deeds, leases and related legal documents and, unless otherwise disclosed to us, we have assumed that there
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Prepared for: are no onerous or restrictive covenants in the titles or leases which would affect the JSC ‘LSR Group’ value.
Where we have not been supplied with leases, unless we have been advised to the contrary, we have assumed that all the leases are on a ‘full repairing and insuring basis’ i.e. (tenant’s responsible for costs) and that all rents are reviewed or adjusted, at the intervals notified to us, based on a market acceptable indexation provision, suitable for the property being valued.
We have assumed that no questions of doubt arise as to the interpretation of the provisions within the leases giving effect to the adjustment of rent.
We have disregarded any inter-company lettings and have arrived at our valuations of such accommodation on the basis of vacant possession.
If a lawyers’ report on title/tenancies or similar legal report has been provided to us, our valuation will have regard to the matters contained therein. In the event that a report on title/tenancies is to be prepared, we recommend that a copy is provided to us in order that we may consider whether any of the matters therein have an effect upon our opinion of value.
COVENANT STATUS OF THE TENANT/TENANTS In the case of properties that are let, our opinion of value is based on our assessment of the investment market’s perception of the covenant strength of the tenant(s). This has been arrived at in our capacity as valuers on the basis of information that is publically available. We are not accountants or financial experts and we have not undertaken a detailed investigation into the financial status of the tenants. We have, however, reviewed where possible third party commentary, on the principal tenants. Our valuations reflect the type of tenants actually in occupation or responsible for meeting lease commitments, or likely to be in occupation, and the market’s general perception of their creditworthiness.
If the covenant status of the tenant(s) is critical to the valuation we recommend that you make your own detailed enquiries as to the financial viability of the tenant(s) and if your conclusions differ from our own, provide us with a copy of the report in order that we may consider whether our valuation should be revised.
ARREARS We have assumed that all rents and other payments payable by virtue of the leases have been paid to date. If there is rent or other arrears, we recommend that we should be informed in order that we may consider whether our valuation should be revised.
TAXATION Whilst we have had regard to the general effects of taxation on value, we have not taken into account any liability for tax which may arise on a disposal, whether actual or notional, and neither have we made any deduction for any tax on capital gains, local consumer tax (VAT) or any other tax.
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Prepared for: MORTGAGES JSC ‘LSR Group’ We have disregarded the existence of any mortgages, debentures or other charges to which the property may be subject.
OPERATIONAL ENTITIES Where the property is valued as an operational entity and reference has been made to the trading history or trading potential of the property, reliance has been placed on information supplied to us. Should this information subsequently prove to be inaccurate or unreliable, the valuation reported could be adversely affected.
Our valuation does not make any allowance for goodwill.
LOCAL AUTHORITIES, STATUTORY UNDERTAKERS AND LEGAL SEARCHES We have not made any formal searches or enquiries in respect of the property and are therefore unable to accept any responsibility in this connection. However, we have where possible, made informal enquiries of the local planning authority in whose area the property is situated as to whether or not it is affected by planning proposals. Accordingly, we have had to rely upon information obtained verbally or via the internet.
We have assumed that all consents, licenses and permissions including, inter alia, fire certificates, enabling the property to be put to the uses ascertained at the date of our inspection have been obtained and that there are no outstanding works or conditions required by the lessor or statutory, local or other competent authorities.
DEFECTIVE PREMISES, HEALTH & SAFETY AND DISABILITY AT WORK Our valuations do not take account of any rights, obligations or liabilities, whether prospective or accrued, under any legislation relating to defective premises, health & safety or disability at work. Unless advised to the contrary, we have assumed that the property complies with and will continue to comply with, all relevant and current defective premises, health & safety and disability at work legislation.
INSURANCE In arriving at our valuation we have assumed that the property is capable of being insured by reputable insurers at reasonable market rates. If, for any reason, insurance would be difficult to obtain or would be subject to an abnormally high premium, it may have an effect on value.
LIABILITY Our valuation is confidential to the party to whom it is addressed for the stated purpose and no liability is accepted to any third party for the whole or any parts of its contents. Liability will not subsequently be extended to any other party save on the basis of written and agreed instructions which may incur an additional fee.
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Prepared for: JSC ‘LSR Group’ APPENDIX 2. VALUATION METHODOLOGY
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Prepared for: Market Value of a real estate property should be arrived at using only the JSC ‘LSR Group’ approach(es) whose application is reasonable and appropriate for the asset being valued.
The Properties comprise a huge number of residential development projects, a few numbers of commercial development projects, premises within completed residential developments and standing commercial assets mainly owner-occupied.
The development properties are in differing stages of development, some being close to completion and others being at the very early stages of the development process. When undertaking the valuation of development sites, there are generally two approaches which can be adopted, the approach selected being generally dependent upon the specific market and characteristics of the property concerned.
The first approach which can be adopted is referred to as the ‘sales comparable’ approach. Where this relates to development sites, the approach involves the analysis of comparable transactions which are generally reported on an area basis, to which adjustments can then be made to reflect differences in location, size, volume of proposed development etc. Adoption of the sales comparison approach necessitates the existence of detailed information on the various transactions available. Where such information is available, for example from a database held by a Land Registry, then this approach can be particularly useful and enables the accurate assessment of the value of properties comprising sites held for development.
Adopting the sales comparison approach for the valuation of development sites in Russia is particularly difficult as a result of the lack of transparency in the market and a general shortage of detailed comparable evidence. This situation can hinder the ability to accurately compare the sale of development sites, meaning that the approach is generally not capable of being adopted at present for those development assets which are relatively advanced in the development process. This current situation is likely to start to change as the property market matures and the availability and credibility of transactional evidence improves.
As a result of the above, we have not adopted this approach in arriving at our opinion of Market Value of the development properties, taking into account that the majority of development projects are reasonably advanced in terms of the overall development process which has to be undertaken by a developer. However, where we are aware of details of comparable transactions, we have had regard to them in arriving at our opinions and these are reflected within the Market Values adopted. However, given the relatively limited number of such transactions we have been required to adopt an alternative technique as the principal approach to valuation of development sites.
The second approach which can be adopted in valuing properties in the course of development is the residual approach to valuation. This approached has been applied by us using the Discounted Cash Flow (“DCF”) methodology which involves the calculation of the present value of all future costs and income to be incurred and generated by the development of the property. This cash flow is discounted at an appropriate rate and this in turn generates a present value of the cash flow, which is the sum available for the purchase of the site/project at the date of valuation.
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Prepared for: For standing commercial properties in St Petersburg (Kazanskaya 36, Zolotaya JSC ‘LSR Group’ Kazanskaya, Kazanskaya 60, Paradniy Quarter BC 11, Paradniy Quarter, bldgs. 17, 18) and in Moscow (Davydkovskaya, Tverskoy Boulevard 16) where our opinion of the highest and best use is sale with vacant possession on a capital value per sq m basis, we have applied the comparable approach.
For land sites held for future development and properties in the course of development, we, as recommended by Valuation Information Paper 12 ‘Valuation of Development Land’ published by the RICS, have used the residual method (the DCF technique).
A brief description of the comparable, income and residual approaches is provided below.
THE COMPARABLE APPROACH The sales comparison approach is based on an appraisal of the Market Value which is derived from information on recent transactions and offers. This information is analysed and the selected properties are compared with the Subject Properties. It is assumed that a prudent investor or buyer will not pay more for a certain property than it would cost to obtain a similar property of similar utility and characteristics. Therefore, the price for which the comparable property was sold should reflect the Market Value of the Subject Properties.
The main difficulties connected with using the comparative approach involve the Russian real estate market’s lack of transparency. In most cases, the real prices of the completed transactions involving comparable properties are unknown. Consequently, offer prices for the properties offered for sale have been used in this valuation.
When using the sales comparison method, comparable properties that were sold or put up for sale on the corresponding market are examined. Adjustments are then made for the differences between the Subject Properties and the comparable properties. The sale price of each comparable property is determined as if at the time of sale they had the same characteristics as the Subject Properties.
We have applied the following adjustments: adjustment for the negotiations, adjustment for the location, adjustment for the distance from metro station, adjustment for a difference in the property and comparable areas, adjustment for the parking.
The adjusted price allows the Valuer to come to logical conclusions on what the market price of the Subject Properties could possibly be.
THE INCOME APPROACH & DCF METODOLOGY The Income Approach is based on the assumption that the value of any property depends on the income this property is expected to generate to its owner. In other words, an investor purchases the property at a current price expecting to receive future incomes from its operation (e.g. from lease) and its further sale.
Two methods are applied for capitalization of future incomes: direct capitalization method and discounted cash flow method.
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Prepared for: Direct capitalization converts an annual income into the value of the real property by JSC ‘LSR Group’ the following formula: NOI V R ,
where V is the value;
NOI – future annual income generated by the Property;
R – capitalization rate.
Direct capitalization can be used when the income generated by the property is expected to be stable, i.e. it will not change in time given the best use of the Subject Property. In case the income is expected to change over the projection period the discounted cash flow method should be applied.
The DCF methodology
The DCF methodology reflects the market’s perception of a relationship between a property’s potential income and its Fair Value, a relationship expressed as a capitalisation rate or yield. This approach converts the anticipated benefits in terms of income (cash flow) or amenity to be derived from the ownership of the Property into a value indication through capitalisation. This approach is widely used when appraising either income-producing properties or properties capable of producing an income. We have valued the Property by means of capitalising the future cash flow produced by the building at the end of our assumed ten year holding period. These future cash flows (both rental and capital receipt from an assumed sale) have then been discounted back at a discount rate that reflects a typical investor’s overall target rate of return.
When applying this method, incomes (with regard to their changes) are to be projected for every year of the projection period. The discounted cash flow method can be applied to any cash flows and is universal. The following formula shows the current value of future benefits stemming from a real property:
T C (C k ) b NPV t T 1 t (1 k )t1 (1 k )T t1 d d , C where t is a cash flow for t period
where CT 1 is a cash flow for the post-projection period k d is the discount rate;
kT is the terminal capitalization rate
b is a fee for selling the building.
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Prepared for: Therefore, the discounted cash flow method is based on the property’s operation during JSC ‘LSR Group’ a certain future period, it means that the projection period, incomes and expenses, discount and capitalization rates should be determined.
This method requires the following steps:
Selection of a projection period;
Valuation of revenues from leasing the Property, i.e. GPI (Gross Potential Income) calculated on the assumption of full occupancy of the Property. This value less losses makes Effective Gross Income;
Analysis and calculation of Operating Expenses;
Operating Expenses are then deducted from effective gross income to obtain Net Operating Income;
Discount and capitalization rate derivation at the date of valuation.
For the purpose of the valuation the projected income from the Property is estimated based on the following indicators:
Gross Potential Income (GPI): is the total income that a real property can generate provided that 100% of leasable space is occupied (net of losses and expenses). It includes total rent payment, rent payment increase according to the agreement and any other incomes stemming from the property (e.g. parking, restaurants, conference rooms, placement of billboards, etc).
Rent loss: which could be observed due to vacancies, change of tenants and failure to pay rent. Usually such losses are expressed as a percentage of GPI and estimated for each local market. Estimating an occupancy rate the valuer must take into account changes of supply and demand for the projection period.
Effective Gross Income (EGI): is the expected total income from all operations adjusted for rent loss due to vacancy and failure to pay under the agreements (i.e. GPI less Rent loss).
Operating expenses: are periodical costs necessary to maintain the property and sustain the effective Gross Potential Income. Operating expenses can be divided into three categories: fixed expenses, variable expenses and replacement allowance.
Net operating income (NOI): is Effective Gross Income less Operating expenses.
Fixed expenses: are operating expenses that do not vary with occupancy. Real estate tax and insurance payments are usually considered as fixed expenses in appraisal practice in Russia.
Variable expenses: are Operating expenses that generally vary with the level of occupancy or the extent of services provided. There are many types of variable expenses. Categories include management charges, leasing fees, utilities (sewer, water, heat, gas, electricity), cleaning, maintenance and repair, grounds and parking area maintenance, security, marketing and promotion. P. 26 COLLIERS INTERNATIONAL
Prepared for: THE RESIDUAL APPROACH & DCF METODOLOGY JSC ‘LSR Group’ The residual value for properties (land sites held for development or projects in the course of development) is the NPV of all future income streams less the NPV of all future costs. The costs include all of the development costs outstanding as at the valuation date in respect of the property being valued and future incomes are assessed based on current returns for completed properties of a similar nature in the market adjusted to reflect the expected completion date for the particular development project and anticipated future trends in rents and/or sales prices.
One of the most commonly used methods within the residual approach for determining Market Value is the DCF method.
The main stages of the method:
Selection of a projection period;
Determination of the sales proceeds (income from sales) from the space to be developed on the subject land plots or profit determination (for commercial properties);
Determination of all development cost and/or operating expenses (for commercial properties);
Discounting of cash flows to their present value based on the concept of the time value of money and compounding of all the present values.
General assumptions for the Residual Approach In addition to the above general valuation methodology, we would point out the following specific assumptions and bases of valuation we have taken into account in arriving at our opinions of Market Value:
Pre Development
We understand that the development concepts and development volumes within the projects under development have been approved by the City Authorities in the majority of development properties considered in this Valuation Report. As a result, we have assumed that the subject properties will be developed in accordance with the approved planning and project documentation. In terms of the projects at the early development stages, which have not obtained full permission from the city authorities, we have analysed the data on the proposed development concepts provided to us by the Client and have formed our opinion on the possibility to adopt these concepts as the basis of the valuation taking into account the highest and best uses of the properties in question.
Development period
All development schedules have been verified against the market data and our knowledge of typical construction timetables in similar projects. In most cases we have applied the development schedules provided to us by the Client, but in those cases where the construction timetable was considered optimistic, we have adopted our adjusted schedules. P. 27 COLLIERS INTERNATIONAL
Prepared for: Phasing JSC ‘LSR Group’ All projects unless specifically stated otherwise, have been assumed to be constructed in one phase according to the time schedule provided by the Client. Where longer term projects have several phases, we have adopted the proposed phasing after having market tested the information supplied by the Client as reasonable and achievable.
Construction costs/ outstanding construction costs
Construction costs have been assessed in accordance with standard rates in the market that a third party developer would expect to incur in the course of development of each proposed scheme. All construction/ outstanding construction budgets have been provided to us by the Client, a seasoned developer, and double-checked by us based on the information provided to us on other similar valuation instructions. We have concluded that the construction/ outstanding construction budgets provided to us by the Client fall into the range of appropriate construction costs which we would expect a third party developer to pay in the present market.
We have assumed the 5% annual growth in construction costs reasonably allows for the potential increase in costs due to the sanctions.
Sales prices
Sales prices for flats and apartments, parking space and ground floor commercial space have been determined based on the analysis of comparable evidence and the recent sales data supplied by the Client.
The sales prices applied in our calculations are average weighted determined based on the adopted sales schedule for each Property and reflect price growth resulting from progress in construction.
5% annual growth has been applied in our calculations.
Sales schedules
In most cases we have adopted our own sales schedules for residential/ apartment development projects valued herein. In general, we, in line with the current market practice, have assumed that sales begin simultaneously with construction commencement (for mass-market and business-class projects) or well into the construction period (for the elite-class projects), intensify close to completion and terminate after completion, normally, at least a year after completion. Car parking has been assumed to sell at a slower pace than residential space. Commercial space has been assumed to sell toward the end of the construction period and after completion.
Sales agent’s fee
When selling residential and apartment, parking and supportive ground floor commercial space, it is a standard market practice to use a broker’s services. Taking into account the size of each Property, the total monetary amount of sales proceeds, we have determined sales agent’s fees at 3%. This amount includes marketing expenses.
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Prepared for: Income due from previous sales/ pre-sales JSC ‘LSR Group’ In many cases the Client is due payment instalments on residential sales/ pre-sales that took place before the valuation date. Where these sums are receivable after the valuation date, we have modelled them into the cash flow according to the schedule supplied by the Client, on the assumption that a third party purchaser of the Property will inherit the right at law to receive these sums after acquiring the Property.
VAT
The VAT rate has been taken at the current rate of 18%. Although in theory VAT in Russia is immediately recoverable from the state, in practice the situation is different. For commercial developments, the VAT paid on construction and other development costs is considered a VAT credit account in favour of the landowner. VAT on future rents can be retained and offset against the VAT account until it is zeroed out.
For the purchase of existing properties VAT is payable in respect of that part of the purchase price apportioned to building improvements. VAT is not payable in respect of the part (or whole) of the purchase price of that relates to the land plot (or land lease).
In our valuations, all costs associated with the development of residential space and parking space are subject to VAT and also that residential and parking sales (in the case parking is dedicated to purchasers of residential space) are not subject to VAT. Therefore, VAT on residential construction and materials are not reclaimed in our models.
Commercial premises in commercial developments and parking space dedicated for commercial uses are net of VAT.
Discounted Cash Flow
The rate used to discount future cash flows to their present value is determined by the level of profits (rate of return) expected by investors as a compensation for their investment risks.
Based on current market conditions, the forecast of economic development in general and the real estate market in particular, as well as taking into account the characteristics of the Property, we have been able to estimate an appropriate discount rate that reflects the perceived risk and required rate of return for the Properties.
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Prepared for: JSC ‘LSR Group’ APPENDIX 3. PROPERTY DESCRIPTION
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Prepared for: JSC ‘LSR Group’ 1. COMMERCIAL PROPERTIES. SAINT- PETERSBURG EXISTINGS BUILDINGS
1. Kazanskaya 36 Main characteristics Market Value: RUB 662,704,000 City: Saint-Petersburg Address: Liter A, B, 36, Kazanskaya St. Inspection date 14.01.2015 Property type: Office center Development stage Completed
Development strategy: Hold
% of completion: 100% % of presold: 0% Construction start: Completed Construction completion: Completed Site area: 0.2526 hectares
Gross buildable area: 7,434.0 sq m
Description: Status on the date of valuation: Class B office center
‘Kazanskaya 36’ office center with a total area of 7,434 sq. m is a 5, 6, 7, 8-storey building with historic facade combining B class office premises Proposed development scheme: and internal parking for 6 car spaces. Office accommodation is fully fitted out. In addition square courtyard is provided by 15 open-air car spaces.
Total NLA 4,764.4 sq. m The office building liter B with a total area of 7,352.7 sq m, cadastral number 78:32:0001293:2677, is held freehold by CJSC ‘A Plyus Estate’ according to the Ownership certificate 78 AZ 359968 dated June 10, 2014. The heating central liter A premises with a total area of 36.6 sq m, cadastral number 78:1293:5:2:12, is held freehold by CJSC ‘A Plyus Estate’ according to the Ownership certificate 78 AZ 359971 dated June 10, 2014. The apartment with a total area of 44.7 sq m, cadastral number 78:32:0001293:2081, is held freehold by CJSC ‘A Plyus Estate’ according to the Tenure: Ownership certificate 78 AZ 359967 dated June 10, 2014 A land plot with a total area of 108.4 sq m, cadastral number: 78:32:0001293:2678 is held freehold by CJSC ‘A Plyus Estate’ according to the Ownership certificate 78 AZ 359969 dated June 10, 2014. A land plot with a total area of 2,418 sq m, cadastral number: 78:32:0001293:2679 is held freehold by CJSC ‘A Plyus Estate’ according to the Ownership certificate 78 AZ 359970 dated June 10, 2014. Encumbrances: Control zone of cultural subjects
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Prepared for: Location JSC ‘LSR Group’
The Property is located in the Admiraleysky district of Saint-Petersburg, at a short distance of 0.35 km from the Sadovaya subway station, 0.90 km from the Nevsky prospekt subway station and 1 km from the Admiralteyskaya subway station, 0.4 km from Voznesensky Ave. and 0.7 km from Nevsky Ave. The Property is approx. 1.6 km from the city centre (Dvortsovaya Square) and 18 km to Pulkovo Airport. The property is located in the historical center of the city. The office center is located in close proximity to the ‘golden triangle’ zone of St. Petersburg next to high quality business centers, hotels and cultural attractions. Isakievskay Cathedral, Mariinsky Palace, Astoria hotel, Angleterre hotel, Renaissance Baltic hotel and Four seasons hotel, White Nights Business Center (class A), SEC PIK, SEC Sennoy are located closed by the Property. Valuation inputs: Methodology: Sales Comparison Approach Special assumption(s): Not applicable Discount rate Not applicable Outstanding costs: - Market average weighted sales price Office building and heating central premises RUB 89,145 per sq m net of VAT
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Prepared for:
JSC ‘LSR Group’ 2. Zolotaya Kazanskaya Main characteristics Market Value: RUB 286,171,000 City: Saint-Petersburg Address: 44, Kazanskaya St. Inspection date 14.01.2015 Property type: Office center Development stage Completed
Development strategy: Hold
% of completion: 100% % of presold: 0% Construction start: Completed Construction completion: Completed Site area: 0.1475 hectares
Gross buildable area: 3,060.6 sq m
Description: Status on the date of valuation: Class B office center ‘Zolotaya Kazanskaya’ office center is a 4, 6-storey building with historic Proposed development scheme: facade combining B class office premises. Office accommodation is fully fitted out. Square courtyard is provided by 4 open-air car spaces. Total NLA: 2,677.2 sq. m A land plot with a total area of 1,475 sq m, cadastral number: 78:1293:2:33 is held leasehold by CJSC ‘Skanska Sankt-Peterburg Development’ according to the land lease agreement 11/ZD-00623 dated October 10, 1996 and expiring on July 10, 2045. Premises with a total area of 3,060.6 sq m are held freehold by CJSC ‘A Plyus Estate’ according to the Ownership certificates 78-АЗ 055289, 78-АЗ Tenure: 055287, 78-АЗ 055283, 78-АЗ 055408, 78-АЗ 055403, 78-АЗ 055401, 78- АЗ 055290, 78-АЗ 055288, 8-АЗ 055404, 78-АЗ 055285, 78-АЗ 055282, 78-АЗ 055284, 8-АЗ 055281, 78-АЗ 055411, 78-АЗ 055410, 78-АЗ 055409, 78-АЗ 055286, 8-АЗ 055402, 78-АЗ 055405, 78-АЗ 055496, 78-АЗ 055406, 78-АЗ 055721, 78-АЗ 055560, 78-АЗ 112236, 78-АЗ 055658, 78-АЗ 055297, 78-АЗ 112238, 78-АЗ 112237, 78-АЗ 055659, 78-АЗ 112235, 78- АЗ 055657, 78-АЗ 479049 dated September 14, 2013. Encumbrances: Control zone of cultural subjects
P. 33 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Admiraleysky district of Saint-Petersburg, at a short distance of 0.5 km from the Sadovaya subway station, 1 km from the Nevsky prospekt subway station and 1.1 km from the Admiralteyskaya subway station, 0.3 km from Voznesensky Ave. and 0.8 km from Nevsky Ave. The Property is approx. 1.7 km from the city centre (Dvortsovaya Square) and 18 km to Pulkovo Airport. The property is located in the historical center of the city. The office center is located in close proximity to the ‘golden triangle’ zone of St. Petersburg next to high quality business centers, hotels and cultural attractions. Isakievskay Cathedral, Marrinsky Palace, Astoria hotel, Angleterre hotel, Renaissance Baltic hotel and Four seasons hotel, White Nights Business Center (class A), SEC PIK, SEC Sennoy are located closed by the Property. Valuation inputs: Methodology: Sales Comparison Approach Special assumption(s): Not applicable Discount rate Not applicable Outstanding costs: - Market average weighted sales price Office premises RUB 93,502 per sq m net of VAT
P. 34 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 3. Paradniy Quarter BC 11 Main characteristics Market Value: RUB 463,569,000 City: Saint-Petersburg Address: Litera A, 39, Kirochanaya St. Inspection date 14.01.2015 Property type: Office center Development stage Completed
Development strategy: Hold
% of completion: 100% % of presold: 0% Construction start: Completed Construction completion: Completed Site area: Part of 9.57 ha
Gross buildable area: 3,806.3 sq m
Description: Status on the date of valuation: Class A office center Office center is a building with historic facade of 3 above ground and 1 underground floors. Office center combines A class office premises and Proposed development scheme: underground parking for 11 car spaces. Office accommodation is fully fitted out. Total NLA: 2,558.6 sq. m A land plot with a total area of 9.57 ha with cadastral number of 78:31:0001210:12 is held on termless right by the Federal State Government Agency ‘North Wes Territorial Administration of the Property Relations ‘Ministry of Defense of the Russian Federation’ Tenure: 25 premises 1H-25H with a total area of 3,806.3 sq m are held freehold by LLC ‘LSR Nedvizhimost Severo Zapad’ according to the Ownership certificates 78-АЖ 837255-837259, 78-АЖ 837380-837394 dated February 08, 2013. Encumbrances: -
P. 35 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Centralny district of Saint-Petersburg, at a short distance of 0.8 km from the Voskresenskaya Emb., 0.6 km from Suvorovsky Ave and at a distance of 0.6 km from Chernyshevskaya subway station. The Property is approx. 3.3 km from the city centre (Dvortsovaya Square) and 21 km to Pulkovo Airport. The property is located in the historical center of the city. The Property is located at a distance of 1.8 km from the "golden triangle" zone of St. Petersburg next to high quality business centers, hotels and cultural attractions. The Tavrichesky Garden, Saltikova Shedrina Garden, Suvorov Museum and a number of educational facilities are in close proximity to the Property. The Property is located at the quarter of new residential complex (Paradny Quarter) and high quality office buildings. Valuation inputs: Methodology: Sales Comparison Approach Special assumption(s): Not applicable Discount rate Not applicable Outstanding costs: - Market average weighted sales price Office premises RUB 121,790 per sq m net of VAT
P. 36 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 4. Kazanskaya 60 Main characteristics Market Value: RUB 207,165,000 City: Saint-Petersburg 60, Kazanskaya St. / Address: 18, Fonarny Lane Inspection date 14.01.2015 Property type: Office center Development stage Completed
Development strategy: Hold
% of completion: 100% % of presold: 0% Construction start: Completed Construction completion: Completed Land plot is not formed as the Site area: subject premises are located at the housing complex
Gross buildable area: 2,212.8 sq m
Description: Status on the date of valuation: Class B office center ‘Kazanskaya 60’ office center is a 4, 6-storey building with historic facade Proposed development scheme: combining B class office premises. Office accommodation is fully fitted out. Total NLA: 2,027.46 sq. m Land plot is not formed as the subject premises are located at the housing complex. Premises with a total area of 3,056.7 sq m are held freehold by CJSC ‘A Plyus Estate’ according to the Ownership certificates 78-АЖ 351209, 78- АЖ 351210, 78-АЖ 351361, 78-АЖ 351514, 78-АЖ 351515, 78-АЖ Tenure: 351516, 78-АЖ 518130,78-АЖ 417754, 78-АЖ 418336, 78-АЖ 518398, 78-АЖ 518971, 78-АЖ 580081, 78-АЖ 629149, 78-АЖ 750904, 78-АЖ 419033, 78-АЖ 419213, 78-АЖ 518130, 78 АЖ 518131, 78 АЖ 518132, 78-АЖ 630698, 78-АЖ 751253, 78-АЗ 113626, 78-АЗ 113628, 78-АЗ 304014. Encumbrances: Control zone of cultural subjects
P. 37 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Admiraleysky district of Saint-Petersburg, at a short distance of 0.9 km from the Sadovaya subway station, 1.4 km from the Nevsky prospekt subway station and 1.5 km from the Admiralteyskaya subway station, 0.1 km from Voznesensky Ave. and 1.2 km from Nevsky Ave. The Property is approx. 2.1 km from the city centre (Dvortsovaya Square) and 18 km to Pulkovo Airport. The property is located in the historical center of the city. The office center is located in close proximity to the ‘golden triangle’ zone of St. Petersburg next to high quality business centers, hotels and cultural attractions. Isakievskay Cathedral, Marrinsky Palace, Astoria hotel, Angleterre hotel, Renaissance Baltic hotel and Four seasons hotel, White Nights Business Center (class A), SEC PIK, SEC Sennoy are located closed by the Property. Valuation inputs: Methodology: Sales Comparison Approach Special assumption(s): Not applicable Discount rate Not applicable Outstanding costs: - Market average weighted sales price Office premises RUB 93,621 per sq m net of VAT
P. 38 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’ 2. LAND PLOTS FOR RESIDENTIAL DEVELOPMENT. SAINT-PETERSBURG PROPERTIES HELD FOR FUTURE DEVELOPMENT
5. Ruch`I Tsvetnoy Gorod Main characteristics Market Value: RUB 8,986,357,000 City: Saint-Petersburg Address: 145, Piskarevsky Ave. Inspection date 15.01.2015 Property type: Mass market residential complex Development stage: Initial concept & planning documents
Development strategy: Build and Sell
% of completion: 4% % of presold: 0% Construction start: 01.01.2016 Construction completion: 31.12.2024 Site area: 429.29 hectares Gross buildable area: 5,458,098 sq m Description: Status on the date of valuation: Land plots are free of any buildings and not fenced The future complex consists of residential buildings of different number of floors Proposed development scheme: with build-in commercial premises, multilevel aboveground ventilated parking and social facilities: 8 schools, 16 kindergarten, 4 clinic and 1 hospital NSA, sq m, as at the Total NSA, sq m, including: 2,960,380 valuation date, including: 2,960,380 Residential 2,509,690 Residential 2,509,690 Commercial 450,690 Commercial 450,690 Parking, car spaces/sq m 25,686 / 321,075 Parking, car spaces/sq m 25,686 A land plots (cadastral numbers: 78:11:5607:54, 78:11:5607:73, 78:11:5607:68, 78:11:5607:55, 78:11:5607:75, 78:11:5607:62, 78:11:5607:91, 78:11:5607:66, 78:11:5607:83, 78:11:5607:82, 78:11:5607:86, 78:11:5607:87, 78:11:5607:67, 78:11:5607:88, 78:11:5607:81, 78:11:5607:84, 78:11:5607:71, 78:11:5607:72) with a total area of 453,900 ha are held leasehold by LLC ‘GDSK’ according to the Ownership Certificates: 78 AD 236622 dated May 31, 2011; 78 AD 207472 dated May 31, 2011; 78 AЖ 235186 dated June 06, 2011; 78 AЖ 664909 Tenure: dated August 21, 2012; 78 AЖ 327799 dated September 13, 2011; 78 AЖ 664908 dated August 21, 2012; 78 AЖ 234437 dated May 31, 2011; 78 AЖ 234438 dated May 31, 2011; 78 AЖ 234434 dated June 01, 2011; 78 AЖ 234432 dated June 01, 2011; 78 AЖ 234623 dated June 01, 2011; 78 AЖ 327800 dated September 13, 2011; 78 AЖ 541671 dated June 01, 2011; 78 AЖ 327802 dated September 13, 2011; 78 AЖ 663894 dated August 01, 2012; 78 AЖ 663895 dated August 01, 2012. Encumbrances: -
P. 39 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Krasnogvardeysky district of Saint-Petersburg, at a distance of 1 km from Piskarevsky Ave., at a distance of 7 km from the Akademicheskaya Subway station, 2 km from Rustavely Ave., 1 km from KAD (Ring Road). The Property is approx. 13 km from the city centre (Dvortsovaya Square) and 36 km to Pulkovo Airport. The nearest existing social facilities are situated at a distance of 2 km from the Property. There are many hypermarkets (Lenta, K-RAUTA, O`Key) and automobile showrooms at a distance of 3-4 km from the Property. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate 30% Outstanding costs: RUB 156,035,066,198 inclusive of VAT Market average weighted sales price Residential RUB 60,000 per sq m Commercial RUB 80,000 per sq m Parking RUB 350,000 per car space
P. 40 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’ 3. RESIDENTIAL PROPERTIES. SAINT- PETERSBURG PROPERTIES IN THE COURSE OF DEVELOPMENT ELITE CLASS RESIDENTIAL
6. Smolniy Park Main characteristics Market Value: RUB 8,064,210,000 City: Saint-Petersburg Address: lit. A, bld. 4, Smolnogo St. Inspection date 14.01.2015 Property type: Elite residential complex Development stage Construction
Development strategy: Build and Sell
% of completion: 80% % of presold: 63% Construction start: 01.06.2010 Construction completion: 31.12.2016 Site area: 8.65 hectares
Gross buildable area: 169,642 sq m
Description: There are four phases of construction in the housing complex Smolniy Park. Status on the date of valuation: Construction of Phase 1 and Phase 2 are completed. Phase 3 and Phase 4 are under construction. Elite class residential complex of 8 above ground and 1-2 underground Proposed development scheme: floors, with commercial space and underground parking NSA, sq m, as at the Total NSA, sq m, including: 37 020 99,807 valuation date, including Residential 84,433 Residential 26 511 Commercial 15,244 Commercial 10 508 Other premises Other premises (storehouse) 130 0 (storehouse) Parking, car spaces/sq m 1,021/12,788 Parking, car spaces/sq m 693 A land plot with a total area of 8.65 ha with cadastral number of Tenure: 78:31:1030A:4 is held leasehold by Smolniy Quarter LLC according to land lease agreement in investment terms 20/ZK-02037 dated June 24, 2004 Liability of renovation of none-residential historical buildings which are Encumbrances: located at the land plot
P. 41 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Centralny district of Saint-Petersburg, at the frist line of the Smolnaya Emb., at a short distance of 0.8 km from Suvorovsky Ave and at a distance of 0.6 km from Chernyshevskaya subway station. The Property is approx. 5.5 km from the city centre (Dvortsovaya Square) and 21 km to Pulkovo Airport. The property is located in the historical center of the city. The housing complex is located in close proximity to the Government of St. Petersburg and the Government of Leningrad region, Garden of Smolny Cathedral.. The housing complex borders on the Smolny Cathedral and the ‘U Nevy’ mini-park. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Phase 1 – 15% Phase 2 – 15% Discount rate Phase 3 – 17% Phase 4 – 18% Outstanding costs: RUB 2,312,088,357 inclusive of VAT Market average weighted sales price Phase 1 – RUB 188,000 per sq m Phase 2 – RUB 280,000 per sq m Residential Phase 3 – RUB 250,000 per sq m Phase 4 – RUB 280,000 per sq m Phase 2 – RUB 136,000 per sq m Commercial Phase 4 – RUB 100,000 per sq m Parking RUB 2,000,000 per car space
P. 42 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 7. Paradniy Quarter (residential) Main characteristics Market Value: RUB 723,072,000 City: Saint-Petersburg Address: 1-3, Paradnaya St. Inspection date 14.01.2015 Property type: Elite residential complex Development stage Completed and partially sold
Development strategy: Sell
% of completion: 100% % of presold: 99% Construction start: 01.07.2010 Construction completion: 31.03.2014 Site area: 9.57 hectares
Gross buildable area: 118,925 sq m
Description: Construction of housing complex is completed. The majority of residential, Status on the date of valuation: build-in premises and car spaces are sold Proposed development Elite class residential complex of 7, 8 above ground and 1 underground floors, scheme: with commercial space and underground parking NSA, sq m, as at the Total NSA, sq m, including: 64,906 valuation date, including: 816 Residential 59,090 Residential 762 Commercial 5,816 Commercial 54 Parking, car spaces/sq m 841/12,705 Parking, car spaces/sq m 258 A land plot with a total area of 9.57 ha with cadastral number of 78:31:0001210:12 is held on termless right by the Federal State Government Tenure: Agency ‘North Wes Territorial Administration of the Property Relations ‘Ministry of Defense of the Russian Federation’ Liability of renovation of none-residential historical buildings which are located Encumbrances: at the land plot
P. 43 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Centralny district of Saint-Petersburg, a short distance of 0.8 km from the Voskresenskaya Emb., 0.6 km from Suvorovsky Ave and at a distance of 0.6 km from Chernyshevskaya subway station. The Property is approx. 3.3 km from the city centre (Dvortsovaya Square) and 21 km to Pulkovo Airport. The property is located in the historical center of the city. The housing complex is located at a distance of 1.8 km from the "golden triangle" zone of St. Petersburg next to high quality business centers, hotels and cultural attractions. The Tavrichesky Garden, Saltikova Shedrina Garden, Suvorov Museum and a number of educational facilities are in close proximity to the Property Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Discount rate 15% Outstanding costs: - Market average weighted sales price Residential RUB 288,000 per sq m Commercial RUB 145,000 per sq m Parking RUB 1,500,000 per car space
P. 44 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 8. Radisheva 39 Main characteristics Market Value: RUB 1,215,999,000 City: Saint-Petersburg Address: Liter M, Bld. 39, Radisheva St. Inspection date 14.01.2015 Property type: Elite residential building Development stage Construction
Development strategy: Build and Sell
% of completion: 79% % of presold: 92% Construction start: 01.02.2013 Construction completion: 31.08.2015 Site area: 0.85 hectares
Gross buildable area: 31,923 sq m
Description: Status on the date of valuation: The residential building is under construction Elite class residential building of 8 above ground and 1 underground Proposed development scheme: floors, with commercial space and underground parking NSA, sq m, as at the Total NSA, sq m, including: 20,818 valuation date, including: 1,752 Residential 18,821 Residential 1,199 Commercial 1,996 Commercial 553 Parking, car spaces/sq m 188/2,355 Parking, car spaces/sq m 45 A land plot with a total area of 8,500 sq m, cadastral number of 78:31:1210:14 is held freehold by JSC ‘Stroitelnaya Korporatsiya Tenure: Vozrozhdenie Sankt-Peterburga’, according to the Ownership Certificates 78-AB №114353, 78-AB №114354, 78-AB №114355, 78-AB №114356 dated August 31, 2006. Encumbrances: -
P. 45 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Centralny district of Saint-Petersburg, a short distance of 0.8 km from the Voskresenskaya Emb. and 0.8 km from Suvorovsky Ave and at a distance of 0.6 km from Chernyshevskaya subway station. The Property is approx. 3.5 km from the city centre (Dvortsovaya Square) and 21 km to Pulkovo Airport. The property is located in the historical center of the city. The residential building is located at a distance of 1.8 km from the "golden triangle" zone of St. Petersburg next to high quality business centers, hotels and cultural attractions. The residential building is located at the quarter of new residential complex (Paradny Quarter) and high quality office buildings. The Tavrichesky Garden, Saltikova Shedrina Garden, Suvorov Museum, Paradniy Quarter Elite residential complex and a number of educational facilities are in close proximity to the Property Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate 17% Outstanding costs: RUB 412,642,333 inclusive of VAT Market average weighted sales price Residential RUB 310,000 per sq m Commercial RUB 145,000 per sq m Parking RUB 1,300,000 per car space
P. 46 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 9. Verona Main characteristics Market Value: RUB 2,160,830,000 City: Saint-Petersburg Address: Liter A, Bld. 29, Morskoy Ave. Inspection date 14.01.2015 Property type: Elite residential building Development stage Design and permitting
Development strategy: Build and Sell
% of completion: 32% % of presold: 27% Construction start: 01.01.2015 Construction completion: 31.08.2017 Site area: 0.36 hectares
Gross buildable area: 20,830 sq m
Description: The property comprises a brown field land plot. The none-residential Status on the date of valuation: building located at the land plot is intended for demolition Elite class residential building consists of 7 above ground and 2 Proposed development scheme: underground floors, with commercial space and underground parking NSA, sq m, as at the Total NSA, sq m, including: 11,749 valuation date, including: 8,608 Residential 10,198 Residential 7,057 Commercial 1,325 Commercial 1,325 Other premises (storehouse) 227 Other premises (storehouse) 227 Parking, car spaces/sq m 111/1,388 Parking, car spaces/sq m 111 A land plot with a total area of 3,572 sq m, cadastral number of 78:7:3282:6 is held freehold by JSC ‘Stroitelnaya Korporatsiya Tenure: Vozrozhdenie Sankt-Peterburga’, according to the Ownership Certificate 78-AЖ №029869 dated November 18, 2010.
Encumbrances: -
P. 47 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Petrogradsky district of Saint-Petersburg, at a short distance of 0.3 km from Krestovsky Ostrov subway station, at a distance of 0.3 km from Martynova Emb. The Property is approx. 5 km from the city centre (Dvortsovaya Square) and 24 km to Pulkovo Airport. The Property is located at the central part of Krestovsky Island, in an established residential neighbourhood built up with modern elite class residential complexes. The Property borders on the Fruktovy Garden The Central Park Kultury I Otdiha, Elagin palace, the Divo Ostrov entertainment park are in close proximity to the Property. The construction of the new Zenit football team stadium is underway in the western part of Krestovsky Island; renovation of the Dinamo stadium located within 0.3 km to the south of the Property is planned in the near future. The construction of West Speed Highway (ZSD) will improve transport accessibility of the Property in the near future. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate: 25% Outstanding costs: RUB 814,829,214 inclusive of VAT Market average weighted sales price Residential RUB 330,000 per sq m Commercial RUB 145,000 per sq m Parking RUB 2,300,000 per car space Storehouse RUB 85,000 per sq m
P. 48 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 10. Kovenskiy 5 Main characteristics Market Value: RUB 260,648,000 City: Saint-Petersburg Address: Bld. 5, Kovensky Lane Inspection date 14.01.2015 Property type: Elite residential complex Development stage Completed and partially sold
Development strategy: Sell
% of completion: 100% % of presold: 97% Construction start: 01.06.2011 Construction completion: 30.04.2013 Site area: 0.39 hectares
Gross buildable area: 12,324 sq m
Description: The property comprises a land plot with an elite residential and office buildings Status on the date of valuation: on it Elite class residential part consists of 5 above ground and 1 underground floors, Proposed development scheme: with commercial space and underground parking. Office building consists of 7 above ground and 1 underground floors. NSA, sq m, as at the Total NSA, sq m, including: 5,871 valuation date, including: 174 Residential 1,058 Residential 174 Commercial 4,813 Commercial 0 Parking, car spaces/sq m 42/726 Parking, car spaces/sq m 6
A land plot with a total area of 3,866 sq m, cadastral number of 78:1218:2 is Tenure: held freehold by JSC ‘Stroitelnaya Korporatsiya Vozrozhdenie Sankt- Peterburga’ as certified by land lease agreement 2F K5 dated July 27, 2010
Encumbrances: -
P. 49 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the central district of Saint-Petersburg, a short distance of 0.7 km from Mayakovskaya subway station and Nevsky Ave. The Property is approx. 2.5 km from the city centre (Dvortsovaya Square) and 20 km to Pulkovo Airport. The property is located in the historical center of the city. The housing complex is located at a distance of 1 km from the "golden triangle" zone of St. Petersburg next to high quality business centers, hotels and cultural attractions. The Madonna of Lurd Catholic Church, schools, kindergarten and other educational facilities are in close proximity to the Property. Shopping centers, restaurants, cafes, shops, museums and exhibition halls are located in surrounding of the Property. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate: 15% Outstanding costs: - Market average weighted sales price Residential RUB 250,000 per sq m Parking RUB 2,100,000 per car space
P. 50 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 11. Dom na Dvoryanskoy Main characteristics Market Value: RUB 393,535,000 City: Saint-Petersburg Address: Liter B, Bld. 13, Kuibysheva St. Inspection date 14.01.2015 Property type: Elite residential complex Development stage Construction
Development strategy: Build and Sell
% of completion: 75% % of presold: 67% Construction start: 01.02.2013 Construction completion: 30.05.2015 Site area: 0.1864 hectares
Gross buildable area: 8,787 sq m
Description: Status on the date of valuation: The housing complex is under construction Proposed development Elite class residential complex of 8 above ground and 1 underground floors, scheme: with commercial space and underground parking NSA, sq m, as at the Total NSA, sq m, including: 6,386 valuation date, including: 2,134 Residential 5,633 Residential 2,134 Commercial 753 Commercial Parking, car spaces/sq m 35/438 Parking, car spaces/sq m 35 A land plot with a total area of 1 864 sq m, cadastral number of 78:7:3008:11 is held freehold by JSC ‘Stroitelnaya Korporatsiya Vozrozhdenie Sankt- Tenure: Peterburga’, according to the Ownership Certificates 78-AГ №953380 dated March 05, 2009.
Encumbrances: -
P. 51 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Petrogradsky district of Saint-Petersburg, a short distance of 0.4 km from the Petrogradskaya Emb. and 0.4 km from Kamennoostrovsky Ave and at a distance of 0.8 km from Gorkovskaya subway station. The Property is approx. 2 km from the city centre (Dvortsovaya Square) and 21 km to Pulkovo Airport. The property is located in the historical center of the city. St. Petersburg`s most famous sights such as the Peter and Paul`s Fortress, St. Petersburg Mosque, museum of artillery, St. Petersburg`s zoo and planetarium, a music hall and several theaters are a convenient walking distance from the Property. There are also business centres, educational facilities, cafes, restaurants and shops close by. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Discount rate: 17% Outstanding costs: RUB 132,985,369 inclusive of VAT Market average weighted sales price Residential RUB 180,000 per sq m Commercial - Parking RUB 1,600,000 per car space
P. 52 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 12. Russkiy Dom Main characteristics Market Value: RUB 1,094,501,000 City: Saint-Petersburg Address: Liter 5A, Bld. 5, Korolenko St. Inspection date 14.01.2015 Property type: Elite residential complex Development stage Design and permitting
Development strategy: Build and Sell
% of completion: 2% % of presold: 0% Construction start: 01.03.2015 Construction completion: 01.01.2019 Site area: 2.4 hectares Gross buildable area: 93,725 sq m Description: Status on the date of valuation: Land plot is free of any buildings and fenced Proposed development Elite class residential complex of 5-9 above ground and 1 underground floors, scheme: with commercial space and underground parking NSA, sq m, as at the Total NSA, sq m, including: 54,788 valuation date, including: 54,614 Residential 49,120 Residential 48,947 Commercial 5,668 Commercial 5,668 Parking, car spaces/sq m 485 / 6,063 Parking, car spaces/sq m 485
A land plot with a total area of 24,027 sq m, cadastral number of Tenure: 78:31:0001279:2360 is held leashold by ‘LSR Nedvizhimost-C3’ LLC as certified by land lease agreement 5/AH dated February 12, 2013.
Encumbrances: -
P. 53 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the central district of Saint-Petersburg, a short distance of 0.8 km from Chernyshevskaya subway station, 1.3 km from Mayakovskaya subway station, 1.5 km from Gostiny Dvor subway station, of 0.1 km from Liteiny Ave. and 0.8 km from Nevsky Ave., the mainthoroughfare of Saint-Petersburg. The Property is approx. 2.2 km from the city centre (Dvortsovaya Square), 20 km to Pulkovo Airport and 1.3 km to Moskovsky railway station. The property is located in the historical center of the city. The housing complex is located at a distance of 0.6 km from the "golden triangle" zone of St. Petersburg next to high quality business centers, hotels and cultural attractions. The largest orthodox church in the city, Spaso-Preobrazhensky Cathedral, the Mikhailovsky Palace, Letny Garden, Marsovo Pole, Mikhailovsky Garden are situated in the walking distance to the Property. Shopping centers, restaurants, cafes, shops, museums and exhibition halls are located in surrounding of the Property. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Discount rate: 25% Outstanding costs: RUB 7,195,275,564 inclusive of VAT Market average weighted sales price Residential RUB 160,000 per sq m Commercial RUB 145,000 per sq m Parking RUB 1,800,000 per car space
P. 54 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’ 4. BUSINESS CLASS RESIDENTIAL
13. Europa City Main characteristics Market Value: RUB 4,900,424,000 City: Saint-Petersburg Address: lit. Ж, bld. 10, Medikov Ave. Inspection date 14.01.2015 Property type: Business class residential complex Development stage Construction
Development strategy: Build and Sell
% of completion: 53% % of presold: 32% Construction start: 01.03.2012 Construction completion: 30.11.2016 Site area: 7.36 hectares
Gross buildable area: 135,554 sq m
Description: There are four phases of construction in the housing complex Europa City. Status on the date of valuation: Construction of Phase 1 and Phase 2 are completed. Phase 3 and Phase 4 are under construction. Business class residential complex comprising 17 residential buildings of varied height (9 and 14 floors), some of which comprise ground floor Proposed development scheme: commercial space and underground parking. The project will include a kindergarten and offer fitted out residential space NSA, sq m, as at the Total NSA, sq m, including: 84,456 valuation date, including: 57,733 Residential 72,098 Residential 55,287 Commercial 12,358 Commercial 2,446 Parking, car spaces/sq m 492 / 6,150 Parking, car spaces/sq m 492 A land plot with a total area of 73.5765 ha with cadastral number of 78:3170:63 is held freehold by JSC ‘Stroitelnaya Korporatsiya Vozrozhdenie Tenure: Sankt-Peterburga’, according to the Ownership Certificates 78-AЖ №570124 dated June 26, 2012. Encumbrances: -
P. 55 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Petrogradsky district of Saint-Petersburg, a short distance of 0.3 km from the Aptekarskaya Emb. and 0.8 km from Kamennostrovsky Ave and at a distance of 1 km from Petrogradskaya subway station. The Property is approx. 5 km from the city centre (Dvortsovaya Square) and 20 km to Pulkovo Airport. The property is located in the historical center of the city. There are the Botanical Garden, business centres, educational facilities, cafes, restaurants and shops close by. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Phase 3 – 18% Discount rate: Phase 4 – 18% Outstanding costs: RUB 3,762,325,567 inclusive of VAT Market average weighted sales price Phase 3 – RUB 135,000 per sq m Residential Phase 4 – RUB 133,000 per sq m Phase 3 – RUB 174,000 per sq m Commercial Phase 4 – RUB 126,000 per sq m Parking RUB 1,200,000 per car space
P. 56 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 14. Tri Vetra Main characteristics Market Value: RUB 804,185,000 City: Saint-Petersburg Address: bld. 151, Savushkina St. Inspection date 14.01.2015 Property type: Business class residential complex Development stage: Design and permitting
Development strategy: Build and Sell
% of completion: 13% % of presold: 0% Construction start: 01.07.2013 Construction completion: 31.12.2018 Site area: 3.0488 hectares Gross buildable area: 108,246 sq m Description: Status on the date of valuation: Land plot is free of any buildings and fenced Proposed development Business class residential complex comprising of 3 residential buildings scheme: (13 floors) with commercial space and multilevel parking (8 and 9 floors) NSA, sq m, as at the Total NSA, sq m, including: 53,850 valuation date, including: 53,850 Residential 52,684 Residential 52,684 Commercial 1,166 Commercial 1,166 Parking, car spaces/sq m 703 / 8,788 Parking, car spaces/sq m 703
A land plot with a total area of 30,488 sq m is held lease hold by LLC ‘GDSK’ as Tenure: certified by land lease agreement 04/03-05/1 dated January 20, 2013 and Supplementary Agreement dated September 19, 2011
Encumbrances: -
P. 57 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Primorsky district of Saint-Petersburg, a short distance of 1.0 km from the West Speed Highway (ZSD) and 2 km from Primorskoe Ave. and 0.3 km from Savushkina St. and at a distance of 2.7 km from Staraya Derevnya subway station. The Property is approx. 10 km from the city centre (Dvortsovaya Square) and 30 km to Pulkovo Airport. The property is located the frontage line of the Finnish Gulf. There are the Park Tryohsotletiya Peterburga, beach, SEC Peterland, business class residential complex (Zolotaya Gavan), automobile dealerships, cafes, restaurants and shops close by the Property. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Discount rate: 25% Outstanding costs: RUB 5,239,125,501 inclusive of VAT Market average weighted sales price Residential RUB 130,000 per sq m Commercial RUB 100,000 per sq m Parking RUB 500,000 per car space
P. 58 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 15. Smolenskaya 14 Main characteristics Market Value: RUB 561,054,000 City: Saint-Petersburg Address: bld. 14, Smolenskaya St. Inspection date 14.01.2015 Business class residential Property type: complex Initial concept and planning Development stage: documents Development strategy: Build and Sell
% of completion: 17% % of presold: 0% Construction start: 01.04.2015 Construction completion: 31.01.2018 Site area: 0.69 hectares
Gross buildable area: 34,352 sq m
Description: Land plot comprised of three sites with a non-residential building planned Status on the date of valuation: for demolition Business class residential complex with build-in premises and Proposed development scheme: underground parking NSA, sq m, as at the Total NSA, sq m, including: 23,090 valuation date, including: 23,090 Residential 22,440 Residential 22,440 Commercial 650 Commercial 650 Parking, car spaces/sq m 251 Parking, car spaces/sq m 251 A land plot with a total area of 2,085 sq m, cadastral number 78:14:7519:23, is held freehold by LLC ‘GDSK’ as certified by the Ownership Certificate 78 АЖ 794378 dated December 13, 2012 A land plot with a total area of 2,785 sq m, cadastral number Tenure: 78:14:7519:1, is held freehold by LLC ‘GDSK’ as certified by the Ownership Certificate 78 АЖ 794379 dated December 13, 2012 A land plot with a total area of 2,001 sq m, cadastral number 78:14:7519:22, is held freehold by LLC ‘GDSK’ as certified by the Ownership Certificate 78 АЖ 794382 dated December 13, 2012 Encumbrances: -
P. 59 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Moskovsky district of Saint-Petersburg, at a short distance of 0.3 km from Moskovsky Ave., 0.7 km from the Obvodny Chanel Emb., at a distance of 0.5 km from Frunzenskaya subway station. The Property is approx. 4 km from the city centre (Dvortsovaya Square) and 15 km to Pulkovo Airport. The Property`s location is comprised of predominantly newly built high-rise residential uses. The Varshavsky Express SEC is closed by. The housing complex is located at a distance of 0.8 km from the historic area of Saint-Petersburg. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Discount rate: 30% Outstanding costs: RUB 1,540,820,569 inclusive of VAT Market average weighted sales price Residential RUB 110,000 per sq m Commercial RUB 100,000 per sq m Parking RUB 1,000,000 per car space
P. 60 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’ 5. MASS MARKET RESIDENTIAL
16. Yuzhnaya Aquatoriya Main characteristics Market Value: RUB 4,250,064,000 City: Saint-Petersburg Address: Quarter 28, 28A, Doblesti St. Inspection date 15.01.2015 Mass market residential Property type: complex Development stage: Construction
Development strategy: Build and Sell
% of completion: 29% % of presold: 46% Construction start: 01.11.2012 Construction completion: 31.12.2018 Site area: 23.9 hectares
Gross buildable area: 523,065 sq m
Description: There are 7 phases of construction in the housing complex Yuzhnaya Status on the date of valuation: Aquatoriya. Construction of Phase 1, 2 and 7 are under construction. The complex consists of several residential buildings of 7 – 25 floors with build-in commercial premise and parking. The residential buildings are to Proposed development scheme: be of reinforced concrete construction and provide fully fitted-out residential accommodation NSA, sq m, as at the Total NSA, sq m, including: 310,766 valuation date, including: 168,101 Residential 291,613 Residential 152,999 Commercial 19,153 Commercial 15,102 Parking, car spaces/sq m 2,506 / 33,575 Parking, car spaces/sq m 2,483
A land plots № 1-10, 13-14, 16-24 with a total area of 239,040 sq m are Tenure: held leasehold by LLC ‘GDSK’ according to the land lease agreement 08/ZDK-02441-02461 dated December 02, 2013.
Encumbrances: -
P. 61 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the southwestern part of the Krasnoselsky district of Saint-Petersburg, to the south-west of the intersection of Doblesti and Marshala Zkharova St, in close proximity to the Gulf of Finland. The Property is situated at a distance of 0.2 km from Leninsky Ave., 7.5 km from KAD (Ring Road) and 6-6.5 km from Prospekt Veteranov, Leninskiy Prospekt and Avtovo subway stations. The road system around the Property is under development, with additional highways planned for construction. The new subway station, Prospekt Geroev, is planned to be built by 2025 in close proximity to the Property. The Property is approx. 19 km from the city centre (Dvortsovaya Square) and 19 km to Pulkovo Airport. The Property`s location is comprised of predominantly newly built high-rise residential uses. The Zhemcuzhnaya Plaza SEC and Yuzhno-Primorsky Park are located at a distance of 5 km from the Property. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Phase 1, Phase 2, Phase 7 – 18% Discount rate: Phase 3, Phase 4, Phase 5, Phase 6 – 20% Outstanding costs: RUB 12,383,048,306 inclusive of VAT Market average weighted sales price Residential RUB 80,000 per sq m Commercial RUB 100,000 per sq m Parking RUB 430,000 per car space
P. 62 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 17. Aurora Main characteristics Market Value: RUB 127,308,000 City: Saint-Petersburg Address: 9A, Belysheva St. Inspection date 15.01.2015 Mass market residential Property type: complex Development stage: Completed and partially sold
Development strategy: Sell
% of completion: 100% % of presold: 99.6% Construction start: 01.07.2011 Construction completion: 30.06.2014 Site area: 15 hectares
Gross buildable area: 415,033 sq m
Description: Status on the date of valuation: Construction of the residential complex is completed. The residential complex with a total area of 415,033 sq m consisting of Proposed development scheme: 2 residential buildings (16 sections of 8 – 25 floors with build-in commercial space and above-ground parking. NSA, sq m, as at the Total NSA, sq m, including: 256,071 valuation date, including: 933 Residential 251,955 Residential 469 Commercial 4,117 Commercial 464 Parking, car spaces/sq m - Parking, car spaces/sq m -
A land plots with a total area of 150,000 sq m are held leasehold by LLC Tenure: ‘GDSK’ according to the land lease agreement 858 dated May 05, 2008.
Encumbrances: -
P. 63 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Nevsky district of Saint-Petersburg, at a distance of 1.6 km from the Prospect Bolshevikov Subway station, 0.7 km from Dalnevostochniy Ave., 7.5 km from KAD (Ring Road). The Property is approx. 9 km from the city centre (Dvortsovaya Square) and 22 km to Pulkovo Airport. The Property`s location is comprised of predominantly newly built high-rise residential uses. The London mall SEC, K-RAUTA, Karusel are closed by. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Discount rate: 15% Outstanding costs: - Market average weighted sales price Residential RUB 110,000 per sq m Commercial RUB 100,000 per sq m Parking -
P. 64 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 18. Sophia Main characteristics Market Value: RUB 5,503,572,000 City: Saint-Petersburg Address: 47, 55, 59 Yuzhnoe Highway Inspection date 15.01.2015 Mass market residential Property type: complex Development stage: Construction
Development strategy: Build and Sell
% of completion: 55% % of presold: 60% Construction start: 01.03.2013 Construction completion: 31.12.2017 Site area: 21.9 hectares
Gross buildable area: 466,416 sq m
Description: Status on the date of valuation: The land plot is in course of development. The residential complex with a total area of 466,416 sq m consisting of several residential buildings of 20-25 floors with build-in commercial space and multilevel aboveground ventilated parking. The residential Proposed development scheme: buildings are to be of reinforced concrete construction and provide fully fitted-out residential accommodation. When construction is completed the grounds will be landscaped to create an attractive park for residents. NSA, sq m, as at the Total NSA, sq m, including: 311,430 valuation date, including: 124,795 Residential 306,029 Residential 122,576 Commercial 5,401 Commercial 2,219 Parking, car spaces/sq m 1,698 / 21,225 Parking, car spaces/sq m 1,576 A land plots with a total area of 21.9 ha (cadastral numbers 78:13:7420:64, 78:13:7420:60, 78:13:5125:21, 78:13:7420:58, 78:13:7420:67, 78:13:7420:66, 78:13:7420:69, 78:13:7420:70, 78:13:7420:61, 78:13:7420:68, 78:13:7420:57, 78:13:7420:71, 78:13:7420:52, 78:13:7420:53, 78:13:7420:54, 78:13:7420:56, 78:13:7420:88, 78:13:7420:87, 78:13:7420:80, 78:13:7420:79, 78:13:7420:84, 78:13:7420:83, 78:13:7420:828, 78:13:7420:57, 78:13:7420:85) is held freehold by LLC ‘Nauchno-proizvodstvennoe obyedinenie Keramika in accordance with the following ownership certificates 78 АЖ 545686 dated March 17, 2012; 78 АЖ 545687 dated March 17, 2012; 78 АЖ 599698 dated June 25, 2012; 78 АЖ 447353 Tenure: dated December 30, 2011; 78 АЖ 545689 dated March 17, 2012; 78 АЖ 545690 dated March 17, 2012; 78 АЖ 545691 dated March 17, 2012; 78 АЖ 447354 dated December 30, 2011, 78 АЖ 545905 dated March 17, 2012; 78 АЖ 545685 dated March 17, 2012; 78 АЖ 393443 dated November 17, 2011; 78 АЖ 393444 dated November 17, 2011; 78 АЖ 393445 dated November 17, 2011; 78 АЖ 393447 dated November 17, 2011; 78 АЖ 599707 dated June 27, 2012; 78 АЖ 691710 dated September 04, 2012; 78 АЖ 599702 dated June 27, 2012; 78 АЖ 599701 dated June 27, 2012; 78 АЖ 691708 dated September 04, 2012; 78 АЖ 699705 dated June 27, 2012; 78 АЖ 699704 dated June 27, 2012; 78 АЖ 575705 dated March 17, 2012; 78 АЖ 691706 dated September 04, 2012. Encumbrances: - P. 65 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Frunzensky district of Saint-Petersburg, at a distance of 2.3 km from the Mezhdunarodnaya Subway station, 0.3 km from Buharestskaya St, 6 km from KAD (Ring Road). The Prospekt Slavy subway station within a short walking distance from the Property is planned for completion to 2017. The Property is approx. 14 km from the city centre (Dvortsovaya Square) and 14 km to Pulkovo Airport. The Park Internaciolistov is closed by. The surrounding buildings to the west. North and south (beyond the green zones) are mostly mass market residential with accompanying amentities. Two modern retail schemes (the Yuzhny Polus retail center and the Lenta hypermarket) are situated at a distance of 0.5 km from the Property. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Discount rate: 18% Outstanding costs: RUB 8,231,066,935 inclusive of VAT Market average weighted sales price Residential RUB 90,000 per sq m Commercial RUB 120,000 per sq m Parking RUB 500,000 per car space
P. 66 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 19. Kalina Park Main characteristics Market Value: RUB 10,601,142,000 City: Saint-Petersburg Address: 12, Marshala Bluhera St. Inspection date 15.01.2015 Property type: Mass market residential complex Development stage: Construction
Development strategy: Build and Sell
% of completion: 43,5% % of presold: 28% Construction start: 01.02.2012 Construction completion: 31.12.2018 Site area: 34.45 hectares
Gross buildable area: 544,700 sq m
Description: Status on the date of valuation: The land plot is in course of development. The residential complex with a total area of 544,700 sq m consisting of several residential buildings of 9 – 25 floors with build-in commercial space and Proposed development multilevel aboveground ventilated parking. The residential buildings are to be or scheme: reinforced concrete construction and provide fully fitted-out residential accommodation. NSA, sq m, as at the Total NSA, sq m, including: 335,917 valuation date, including: 240,780 Residential 331,196 Residential 239,053 Commercial 4,721 Commercial 1,728 Parking, car spaces/sq m 1,476 / 18,450 Parking, car spaces/sq m 1,176 A land plots with a total area of 34.45 ha (cadastral numbers 78:10:0005125:18, 78:10:0005125:27 78:10:0005125:47, 78:10:0005125:26, 78:10:0005125:25, 78:10:0005125:45, 78:10:0005125:41, 78:10:0005125:40, 78:10:0005125:28, 78:10:0005125:20, 78:10:0005125:21, 78:10:0005125:68, 78:10:0005125:70, 78:10:0005125:69, 78:10:0005125:67) is held freehold by LLC ‘GDSK’ in accordance with the following ownership certificates: Tenure: 78 АЖ 160248 dated March 15, 2011; 78 АЖ 160250 dated March 15, 2011; 78 АЖ 160246 dated March 15, 2011; 78 АЖ 228181 dated April 22, 2011; 78 АЖ 228179 dated April 22, 2011; 78 АЖ 228178 dated April 22, 2011; 78 АЖ 228182 dated April 22, 2011; 78 АЖ 467065 dated December 12, 2011; 78 АЖ 467064 dated December 12, 2011; 78 АЖ 467905 dated January 24, 2012; АЖ 620112 dated June 06, 2012; 78 АЖ 620113 dated May 26, 2012; 78 АЖ 620111 dated June 04, 2012; 78 АЖ 620110 dated June 04, 2012. Encumbrances: -
P. 67 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Kalininsky district of Saint-Petersburg, at a distance of 1.2 km from the Lesnaya Subway station, 0.1 km from Kushelevsakaya Road and Marshala Bluhera Ave., 8 km from KAD (Ring Road). The Property is approx. 8 km from the city centre (Dvortsovaya Square) and 27 km to Pulkovo Airport. The Property`s location is comprised of predominantly newly built high-rise residential uses. The immediate environs comprise an established residential area with social amenities. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Discount rate: 18% Outstanding costs: RUB 9,374,574,489 inclusive of VAT Market average weighted sales price Residential RUB 90,000 per sq m Commercial RUB 120,000 per sq m Parking RUB 420,000 per car space
P. 68 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 20. Viva Main characteristics Market Value: RUB 875,590,000 City: Saint-Petersburg Litera D, 3, Moskovskoe Address: Highway Inspection date 15.01.2015 Mass market residential Property type: complex Development stage: Construction
Development strategy: Build and Sell % of completion: 85% % of presold: 87% Construction start: 01.05.2012 Construction completion: 31.06.2017 Site area: 9.15 hectares
Gross buildable area: 148,064 sq m
Description: Status on the date of valuation: The land plot is in course of development. The residential complex with a total area of 148,064 sq m consisting of several residential buildings of 18 – 25 floors with build-in commercial Proposed development scheme: space and multilevel aboveground ventilated parking. The residential buildings are to be or reinforced concrete construction and provide fully fitted-out residential accommodation. NSA, sq m, as at the Total NSA, sq m, including: 102,984 valuation date, including: 13,026 Residential 101,930 Residential 12,358 Commercial 1,054 Commercial 668 Parking, car spaces/sq m 580 / 7,250 Parking, car spaces/sq m 236 A land plot with a total area of 80,001 sq m (cadastral number 78:14:76861:6) and land plot with a total area of 11,500 sq m (cadastral Tenure: number 78:14:76861:7) are held freehold by LLC ‘GDSK’ according to the following ownership certificates: 78 АЖ 137100 dated January 21, 2011; 78 АЖ 137107 dated January 21, 2011. Encumbrances: -
P. 69 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Moskovsky district of Saint-Petersburg, at a distance of 0.9 km from the Zvezdnaya Subway station, 1.5 km from Moskovsky Ave., 0.8 km from Pulkovskoe Highway, 2 km from KAD (Ring Road). The Property is approx. 12.5 km from the city centre (Dvortsovaya Square) and 8 km to Pulkovo Airport. The Property`s location is comprised of predominantly newly built high-rise residential uses. The immediate environs comprise an established residential area with social amenities. The Pulkovsky Park, a large green area with a pond, is located at a distance of 0.1 km from the Property. Within walking distance (1-1.5 km) of the Property is a large retail park with hypermarkets (Lenta, O`Key, METRO Cash&Carry, Karusel, Castorama and Pulkovo-3) and entertainment zone. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Discount rate: 17% Outstanding costs: RUB 992,780,806 inclusive of VAT Market average weighted sales price Residential RUB 105,000 per sq m Commercial RUB 120,000 per sq m Parking RUB 440,000 per car space
P. 70 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 21. Kvartet Main characteristics Market Value: RUB 322,233,000 City: Saint-Petersburg Address: 27, Dunaysky Ave Inspection date 15.01.2015 Mass market residential Property type: complex Development stage: Construction
Development strategy: Build and Sell
% of completion: 47.5% % of presold: 83% Construction start: 01.11.2012 Construction completion: 31.12.2016 Site area: 6.17 hectares
Gross buildable area: 155,863 sq m
Description: Status on the date of valuation: The land plot is in course of development. The residential complex with a total area of 155,863 sq m consisting of 4 residential buildings of 25 floors with build-in commercial space and Proposed development scheme: multilevel aboveground ventilated parking. The residential buildings are to be or reinforced concrete construction and provide fully fitted-out residential accommodation. NSA, sq m, as at the Total NSA, sq m, including: 109,570 valuation date, including: 18,284 Residential 108,450 Residential 18,284 Commercial 1,121 Commercial Parking, car spaces/sq m 583 / 7,288 Parking, car spaces/sq m 504 A land plots with a total area of 6.17 ha (cadastral numbers: 78:14:769203:70, 78:14:769203:72, 78:14:769203:69, 78:14:769203:75, 78:14:769203:74, 78:14:769203:71, 78:14:769203:73) is held freehold by LLC ‘GDSK’ according to the following ownership certificates: 78 АЖ Tenure: 543542 dated March 03, 2012; 78 АЖ 543548 dated March 03, 2012; 78 АЖ 543544 dated March 03, 2012; 78 АЖ 543546 dated March 03, 2012; 78 АЖ 543543 dated March 03, 2012; 78 АЖ 543547 dated March 03, 2012; 78 АЖ 543550 dated March 03, 2012. Encumbrances: -
P. 71 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Moskovsky district of Saint-Petersburg, at a distance of 0,2 km from the Kupchino Subway station and Vitebsky Ave., 1.5 km from Moskovskoe Highway, 2 km from KAD (Ring Road). The Property is approx. 15 km from the city centre (Dvortsovaya Square) and 10 km to Pulkovo Airport. The Property`s location is comprised of predominantly newly built high-rise residential uses. The immediate environs comprise an established residential area with social amenities. The Pulkovsky Park, a large green area with a pond, is located at a distance of 2.5 km from the Property. The Property benefits from the well-developed business, retail and social infrastructure in the zones of Kupchino and Zvezdnaya subway station. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Discount rate: 17% Outstanding costs: RUB 2,540,206,254 inclusive of VAT Market average weighted sales price Residential RUB 85,000 per sq m Commercial RUB 120,000 per sq m Parking RUB 450,000 per car space
P. 72 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 22. Shuvalovsky Main characteristics Market Value: RUB 2,996,130,000 City: Saint-Petersburg Parashutanya St (land plot Address: 404,405,406, 407, 408, 409,410,411,412 Prigorodny) Inspection date 15.01.2015 Mass market residential Property type: complex Development stage: Construction
Development strategy: Build and Sell % of completion: 10% % of presold: 18% Construction start: 01.07.2014 Construction completion: 31.12.2020 Site area: 30.9 hectares
Gross buildable area: 680,716 sq m
Description: Status on the date of valuation: The land plot is in course of development. The residential complex with a total area of 680,716 sq m consisting of several residential buildings of 16-25 floors with build-in commercial Proposed development scheme: space in the build-in premises and multilevel aboveground ventilated parking. The residential buildings are to be or reinforced concrete construction and provide fully fitted-out residential accommodation. NSA, sq m, as at the Total NSA, sq m, including: 422,134 valuation date, including: 347,824 Residential 418,901 Residential 345,377 Commercial 3,233 Commercial 2,447 Parking, car spaces/sq m 2,506 / 31,325 Parking, car spaces/sq m 2,455 A land plots with a total area of 309,448 sq m (land plot 404,405,406, 407, 408, 409,410,411,412) is held freehold by LLC ‘LSR Nedvizhimost Tenure: Severo-Zapad’ according to the following ownership certificates: 78 AZ 419547 dated June 16, 2014; 78 AZ 419545 dated June 16, 2014; 78 AZ 481971 dated August 28, 2014; 78 AZ 481973 dated August 28, 2014 Encumbrances: -
P. 73 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Primorsky district of Saint-Petersburg, at the first line of Parashutnaya St., at a distance of 5.2 km from the Udelnaya Subway station, 4.2 km from the Komendantsky Prospekt Subway station, 6 km from KAD (Ring Road). Two subway stations located close to the Property, Kamenka and Shuvalovsky Prospect, are planned to be completed in 2025. The Property is approx. 13 km from the city centre (Dvortsovaya Square) and 32 km to Pulkovo Airport. The Property`s location is comprised of predominantly newly built high-rise residential uses. The immediate environs comprise an established residential area with social amenities. The Novoorlovsky Forest and the Shuvalovsky Karyer Lake are located at a distance of 2-3 km from the Property. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Discount rate: 20% Outstanding costs: RUB 25,765,517,673 inclusive of VAT Market average weighted sales price Residential RUB 80,000 per sq m Commercial RUB 110,000 per sq m Parking RUB 375,000 per car space
P. 74 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 23. Novaya Okhta Main characteristics Market Value: RUB 6,180,207,000 City: Saint-Petersburg Address: Murinskaya road Inspection date 15.01.2015 Property type: Mass market residential complex Development stage: Construction
Development strategy: Build and Sell
% of completion: 38.6% % of presold: 41% Construction start: 01.09.2012 Construction completion: 31.12.2018 Site area: 104.74 hectares
Gross buildable area: 1,241,545 sq m
Description: Status on the date of valuation: The land plot is in course of development. The residential complex consists of several residential buildings of different number of floors with commercial premises and multilevel Proposed development scheme: aboveground ventilated parking and social facilities: 3 schools, 5 kindergartens and 2 clinics. NSA, sq m, as at the Total NSA, sq m, including: 794,577 valuation date, including: 469,220 Residential 775,316 Residential 458,657 Commercial 19,261 Commercial 10,564 Parking, car spaces/sq m 5,943 / 74,288 Parking, car spaces/sq m 5,772 A land plots with a total area of 104.74 ha (cadastral numbers: 78:11:0005608:1149; 78:11:0005608:1150; 78:11:0005608:1146; 78:11:5608:68; 78:11:5609:13; 78:11:5609:14; 78:11:5609:15; Tenure: 78:11:0005608:66) is held freehold by LLC ‘GDSK’ according to the following ownership certificates: 78 AZ 234735 dated June 1, 2011; 78 AZ 664904 dated August 21, 2012; 78 AZ 664903 dated August 21, 2014; 78 AZ 664905 dated August 21, 2012; 78 AZ 234439 dated May 31, 2011 Encumbrances: -
P. 75 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Krasnogvardeysky district of Saint-Petersburg, at the first line of Murinskaya Road, at a distance of 2 km from the Grazhdansky Prospekt and Devyatkino Subway station, 1 km from Rustavely Ave, 2 km frpm Piskarevsky Ave., 1 km from KAD (Ring Road). The Property is approx. 15 km from the city centre (Dvortsovaya Square) and 40 km to Pulkovo Airport. The Property`s location is comprised of predominantly newly built high-rise residential uses. Surrounding of the Property is in progress of development; the nearest social facilities are situated at a distance of 2 km from the Property. There are many hypermarkets (Lenta, K-RAUTA, O`Key) and automobile showrooms at a distance of 2- 3 km from the Property. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate: 18% Outstanding costs: RUB 27,301,960,121 inclusive of VAT Market average weighted sales price Residential RUB 65,000 per sq m Commercial RUB 80,000 per sq m Parking RUB 375,000 per car space
P. 76 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 24. Ruchyi-7 Main characteristics Market Value: RUB 1,636,444,000 City: Saint-Petersburg Address: 145, Piskarevsky Ave Inspection date 15.01.2015 Mass market residential Property type: complex Initial concept & planning Development stage: documents Development strategy: Build and Sell % of completion: 1% % of presold: 0% Construction start: 01.02.2016 Construction completion: 31.12.2018 Site area: 23,66 hectares
Gross buildable area: 282,321 sq m
Description: Land plot comprised of three sites with a non-residential building planned Status on the date of valuation: for demolition The residential complex consists of several residential buildings of different number of floors with commercial premises and multilevel Proposed development scheme: aboveground ventilated parking and social facilities: 3 schools, 5 kindergartens and 2 clinics. NSA, sq m, as at the Total NSA, sq m, including: 211,421 valuation date, including: 211,421 Residential 209,435 Residential 209,435 Commercial 1,986 Commercial 1,986 Parking, car spaces/sq m 2,546 Parking, car spaces/sq m 2,546 A land plot with a total area of 23.66 ha (cadastral numbers: 78:11:5606:98; 78:11:5606:99; 78:11:5606:105; 78:11:5606:104; 78:11:5606:106) is held freehold by LLC ‘GDSK’ according to the Tenure: following ownership certificates: 78 AЖ 206715 dated April 26, 2011; 78 AЖ 206714 dated April 26, 2011; 78 AЖ 206874 dated April 27, 2011; AЖ 206872 dated April 26, 2011; AЖ 206875 dated April 27, 2011. Encumbrances: -
P. 77 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Krasnogvardeysky district of Saint-Petersburg, at a distance of 0.2 km from Piskarevsky Ave., at a distance of 5 km from the Akademicheskaya Subway station, 1 km from Rustavely Ave., 1 km from KAD (Ring Road). The Property is approx. 13 km from the city centre (Dvortsovaya Square) and 36 km to Pulkovo Airport. Surrounding of the Property is in progress of development; the nearest social facilities are situated at a distance of 2 km from the Property. There are many hypermarkets (Lenta, K-RAUTA, O`Key) and automobile showrooms at a distance of 2-3 km from the Property. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Discount rate: 25% Outstanding costs: RUB 11,324,567,714 inclusive of VAT Market average weighted sales price Residential RUB 65,000 per sq m Commercial RUB 80,000 per sq m Parking RUB 375,000 per car space
P. 78 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 25. Zapovednaya Main characteristics Market Value: RUB 2,145,434,000 City: Saint-Petersburg Address: 51b, Zapovednaya St. Inspection date 15.01.2015 Mass market residential Property type: complex Initial concept & planning Development stage: documents Development strategy: Build and Sell % of completion: 18.9% % of presold: 0% Construction start: 01.09.2015
Construction completion: 01.07.2018 Site area: 20.6 hectares Gross buildable area: 298,727 sq m Description: Status on the date of valuation: Land plot is free from buildings and other improvements, not fenced. The residential complex with a total area of 298,727 sq m consists of Proposed development scheme: several residential buildings of different number of floors with multilevel aboveground ventilated parking. NSA, sq m, as at the Total NSA, sq m, including: 209,109 valuation date, including: 209,109 Residential 209,109 Residential 209,109 Commercial - Commercial - Parking, car spaces/sq m 1,892 / 23,650 Parking, car spaces/sq m 1,892 A land plot with a total area of 206,190 sq m, cadastral numbers: 78:34:0004270:93, is held freehold by LLC ‘LSR Nedvizhimost Severo Tenure: Zapad’ according to the following ownership certificates: 78 AЗ 418115 dated June 04, 2014 Encumbrances: -
P. 79 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Primorsky district of Saint-Petersburg, in the entersection between Suzdalsky Ave. a nd Zapovednaya St., at a distance of 7 km from the Prospekt Prosveshenya Subway station, 3.5 km from the Vyborgskoe Highway, 3 km from the Parashutnaya St., 7 km from KAD (Ring Road). Two subway stations located close to the Property, Kamenka and Shuvalovsky Prospect, are planned to be completed in 2025. The Property is approx. 19 km from the city centre (Dvortsovaya Square) and 37 km to Pulkovo Airport. The Novoorlovsky Forest and the Orlovsky Karyer Lake are located at a distance of 1-2 km from the Property. Surrounding of the Property is poor developed; the nearest social facilities are situated at a distance of 2 km from the Property. There are many hypermarkets (Lenta, K-RAUTA, O`Key) and automobile showrooms at a distance of 4-5 km from the Property. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Discount rate: 27% Outstanding costs: RUB 10,990,537,500 inclusive of VAT Market average weighted sales price Residential RUB 70,000 per sq m Commercial RUB 80,000 per sq m Parking RUB 375,000 per car space
P. 80 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 26. Aeroport Rzhevka Main characteristics Market Value: RUB 2,201,966,000 City: Leningrad region Airport Rzhevka, Vsevolozhsk Address: district Inspection date 15.01.2015 Mass market residential Property type: complex Initial concept & planning Development stage: documents Development strategy: Build and Sell % of completion: 5% % of presold: 0% Construction start: 01.07.2016 Construction completion: 31.10.2025 Site area: 175 hectares
Gross buildable area: 1,637,974 sq m
Description:
Status on the date of valuation: Land plot with a non-residential building planned for demolition
The residential complex with a total area of 1,637,974 sq m consists of several residential buildings of different number of floors with multilevel Proposed development scheme: aboveground ventilated parking and accompanying commercial and social infrastructure NSA, sq m, as at the Total NSA, sq m, including: 1,146,582 valuation date, including: 1,146,582 Residential 1,146,582 Residential 1,146,582 Commercial - Commercial - Parking, car spaces/sq m - Parking, car spaces/sq m - A land plot with a total area of 1,663,174 sq m, cadastral number: 47:07:13-02-195:0019, is held freehold by LLC ‘LSR Nedvizhimost Severo Zapad’ according to the following ownership certificates: 78 AЗ 380711 dated April 21, 2014 Tenure: A land plot with a total area of 90,229.29 sq m, cadastral number: 47:07:13-02-195:0029, is held freehold by LLC ‘LSR Nedvizhimost Severo Zapad’ according to the following ownership certificates: 78 AЗ 380712 dated April 21, 2014 Encumbrances: -
P. 81 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Vsevolozhsky district of the Leningrad region, at a distance of 8 km from Saint- Petersburg, 4 km from the Ryabovskoe Highway, 4 km from KAD (Ring Road), 12 km from the Ladozhskaya Subway station. The Property is approx. 20 km from the city centre (Dvortsovaya Square) and 40 km to Pulkovo Airport. The Property is embosomed in forest (green area). Surrounding of the Property is poor developed; the nearest social facilities are situated in Saint-Petersburg, at a distance of 7-8 km from the Property. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate: 30% Outstanding costs: RUB 51,466,464,966 inclusive of VAT Market average weighted sales price Residential RUB 55,000 per sq m Commercial - Parking -
P. 82 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 27. Oktyabrskaya Naberezhnaya Main characteristics Market Value: RUB 5,050,755,000 City: Saint-Petersburg Address: 40-42, the Oktyabrskaya Emb. Inspection date 15.01.2015 Property type: Mass market residential complex Development stage: Design and permitting
Development strategy: Build and Sell
% of completion: 0.2% % of presold: 0% Construction start: 01.02.2016 Construction completion: 31.12.2025 Site area: 59,53 hectares
Gross buildable area: 1,329,981 sq m
Description: The land plots are occupied with factories which in the near future will be Status on the date of valuation: relocated. Land plot consists of two sites (Rudas and Barrikada) with a non- residential buildings planned for demolition. The residential complex consists of 8 phases. The residential buildings are to Proposed development scheme: be of reinforced concrete construction and provide fully fitted-out residential accommodation. NSA, sq m, as at the Total NSA, sq m, including: 823,724 valuation date, including: 823,724 Residential 807,880 Residential 807,880 Commercial 15,844 Commercial 15,844 Parking, car spaces/sq m 4,230 / 52,875 Parking, car spaces/sq m 4,230 Land plots with area of 71,829 sq m, 5,650 sq m, 138,268 sq m, 18,276 sq m (cadastral numbers: 78:12:6331Б:648, 78:12:6331Б:649, 78:12:6331Б:650, 78:12:6331Б:651, 78:12:0633102:4179) is held freehold by JSC ‘LSR-Bazovie’ Land plot with a total area of 76,193 sq m, cadastral number 78:12:0633102:4179, is held freehold by LLC ‘Aerok SPb’ according to the Ownership certificates Land plots with area of 37,422 sq m, 1,786 sq m, 3105sq m, 7,735 sq m, 2,643 Tenure: sq m (cadastral numbers: 78:12:6333:24, 78:12:6333:22, 78:12:6333:8, 78:12:6333:10, 78:12:6333:14) is held freehold by LLC ‘LSR-Nedvizhimost- Severo Zapad’ according to the Ownership certificates Land plot with a total area of 204,710 sq m, cadastral number 78:12:0006333:18, is held freehold by LLC ‘Oktyabrskaya 42’ Land plot with a total area of 27,712 sq m, cadastral number 78:12:0006333:5, is held freehold by LLC ‘Cementny elevator’ Encumbrances: -
P. 83 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Nevsky district of Saint-Petersburg, in the intersection between the Oktyabrskaya Emb. and Dalnevostochny Ave., at a distance of 2 km from Ulitsa Dybenko Subway station, 2 km from Bolshevikov Ave., 7 km from KAD (Ring Road). The Property is approx. 10 km from the city centre (Dvortsovaya Square) and 24 km to Pulkovo Airport. The nearest social facilities are situated at a distance of 2 km from the Property. There are big retail zone (London Mall SEC, Castorama, Karusel, Leroy Merlin) and automobile showrooms at a distance of 1-2 km from the Property. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Discount rate: 30% Outstanding costs: RUB 51,613,358,381 inclusive of VAT Market average weighted sales price Residential RUB 85,000 per sq m Commercial RUB 100,000 per sq m Parking RUB 400,000 per car space
P. 84 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’ 6. COMMERCIAL PROPERTIES. SAINT- PETERSBURG PROPERTIES IN THE COURSE OF DEVELOPMENT
28. Nevskiy 68 Main characteristics Market Value: RUB 3,139,400,000 City: Saint-Petersburg Address: 68, Nevsky Ave. Inspection date 14.01.2015 Property type: Apartment complex Development stage Completed
Development strategy: Sell
% of completion: 95% % of presold: 0% Construction start: 10.12.2010 Construction completion: 31.12.2012 Site area: 0.1539 hectares
Gross buildable area: 8,614.1 sq m
Description: Status on the date of valuation: The project is in final stage. The property is in the market. The non-residential building consists of 7 above ground floors with apartments and build-in retail premises and underground parking for Proposed development scheme: 26 cars. The non-residential building is to be of reinforced concrete construction and provide fully fitted-out apartment accommodation. NSA, sq m, as at the Total NSA, sq m, including: 5,935 valuation date, including: 5,935 Residential 3,631 Residential 3,631 Retail 2,304 Commercial 2,304 Parking, car spaces 26 Parking, car spaces/sq m 26 The land plot with a total area of 1,530 sq m, cadastral number of 78:1283:21, is held leasehold by LLC ‘AvtoKombalt’ according to the lease agreement dated July 14, 2010. The land plot with a total area of 635 sq m, cadastral number of Tenure: 78:1283:1017, is held leasehold by LLC ‘AvtoKombalt’ according to the lease agreement 0003/ZK-006137 dated October 19, 2010. Investment Contract 10-(1) 006020 dated August 12, 2005 and Supplementary agreement dated July 13, 2010. Encumbrances: Control zone of cultural subjects.
P. 85 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the central district of Saint-Petersburg, at the frontage line of Nevsky Ave., a short distance of 0.7 km from Mayakovskaya, Gostiny Dvor, Dostoevskaya subway stations. The Property is approx. 2.0 km from the city centre (Dvortsovaya Square) and 20 km to Pulkovo Airport. The property is located in the historical center of the city. The housing complex is located in close proximity to the "golden triangle" zone of St. Petersburg next to high quality business centers, hotels and cultural attractions. Shopping centers, restaurants, cafes, shops, museums and exhibition halls are located in surrounding of the Property. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Discount rate: 15% Outstanding costs: RUB 135,035,000 inclusive of VAT Market average weighted sales price Apartments RUB 650,000 per sq m Retail RUB 550,000 per sq m Car spaces RUB 3,000,000 per sq m
P. 86 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 29. Nevskiy 1 Main characteristics Market Value: RUB 1,796,300,000 City: Saint-Petersburg Address: 1, Nevsky Ave. Inspection date 14.01.2015 Property type: Apartment complex Initial concept and planning Development stage documents
Development strategy: Build and Sell % of completion: 21% % of presold: 0% Construction start: 01.01.2016 Construction completion: 31.12.2018 Site area: 0.2503 ha
Gross buildable area: 9,709 sq m
Description: Status on the date of valuation: Current use of the Property is office building with build-in retail premises. After renovation building will comprise apartments, build-in premises Proposed development scheme: retail premises and parking for 21 cars. NSA, sq m, as at the Total NSA, sq m, including: 7,181 valuation date, including: 7,181 Residential 5,071 Residential 5,071 Other 2,109 Other 2,109 Parking, car spaces 21 Parking, car spaces/sq m 21 The land plot with a total area of 2,503 sq m, cadastral number of 78:31:0001095:1453, is held freehold by JSC ‘Stroitelnaya Korporatsia Vozrozhdenie Sankt-Peterburga’ according to the Ownership certificate78-AE 470048 dated August 05, 2014 in share of 2,374/2,503. Tenure: The land plot with a total area of 2,503 sq m, cadastral number of 78:31:0001095:1453, is held freehold by LLC ‘Nevinvest’ according to the Ownership certificate78-AE 470047 dated August 05, 2014 in share of 2,374/2,503. Encumbrances: Control zone of cultural subjects.
P. 87 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the central district of Saint-Petersburg, at the frontage line of Nevsky Ave., a short distance of 0.7 km from Adiralteyskaya subway station. The Property is approx. 0.1 km from the city centre (Dvortsovaya Square) and 18 km to Pulkovo Airport. The Property has excellent view characteristics (the Heritage, Admiralteystvo, Aleksandrovsky Garden and the Dvortsovaya Square). The property is located in the historical center of the city. The housing complex is located in close proximity to the "golden triangle" zone of St. Petersburg next to high quality business centers, hotels and cultural attractions. Dvortsovaya Square, the Heritage, Isaakievsky Cathedral, Aleksandrovsky Garden are closed by the Property. Office centers, restaurants, cafes, shops, museums and exhibition halls are located in surrounding of the Property. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Discount rate: 20% Outstanding costs: RUB 1,449,982,292 inclusive of VAT Market average weighted sales price Apartments RUB 800,000 per sq m Retail RUB 450,000 per sq m Car spaces RUB 3,000,000 per sq m
P. 88 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 30. Fontanka 3 Main characteristics Market Value: RUB 1,588,700,000 City: Saint-Petersburg Address: 3, The Fontanka River Emb. Inspection date 14.01.2015 Property type: Apartment complex Development stage Design and permitting
Development strategy: Build and Sell
% of completion: 48% % of presold: 0% Construction start: 01.07.2015 Construction completion: 31.10.2016 Site area: 0.1871 ha
Gross buildable area: 8,772 sq m
Description: Status on the date of valuation: Current use of the Property is none-residential building. After renovation building will comprise apartments, build-in premises Proposed development scheme: retail premises and parking for 45 cars. NSA, sq m, as at the Total NSA, sq m, including: 5,316 valuation date, including: 5,316 Residential 4,619 Residential 4,619 Other 697 Other 697 Parking, car spaces 45 Parking, car spaces 45 The land plot with a total area of 1 871 sq m, cadastral number of 78:31:1188:8, is held leasehold by SPb GUP Electrotrans according to the Investment Contract dated May 11, 2010. The land plot with a total area of 35 sq m, cadastral number of 78:31:0001188:115, is held leasehold by SPb GUP Electrotrans Tenure: according to the land lease agreement 03/ZK-08022 dated December 13, 2013 (for temporary use). The land plot with a total area of 390 sq m, cadastral number of 78:31:0001188:116, is held leasehold by SPb GUP Electrotrans according to the land lease agreement 03/ZK-08023 dated December 13, 2013 (for temporary use). Control zone of cultural subjects; construction of Distribution Transformer Encumbrances: Substation
P. 89 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the central district of Saint-Petersburg, at the frontage line of the Fontanka River Emb., a short distance of 0.7 km from Gostiny Dvor subway stations, at a distance of 0.4 km from Nevsky Ave. The Property is approx. 2.0 km from the city centre (Dvortsovaya Square) and 20 km to Pulkovo Airport. The property is located in the historical center of the city. The housing complex is located at the "golden triangle" zone of St. Petersburg next to high quality business centers, hotels and cultural attractions. Letny Garden, Mikhailovsky Garden, Mikhailovsky Opera Theater, Russian Museum are closed by the Property. Office centers, restaurants, cafes, shops, museums and exhibition halls are located in surrounding of the Property. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Discount rate: 30% Outstanding costs: RUB 851,887,000 inclusive of VAT Market average weighted sales price Apartments RUB 500,000 per sq m Retail RUB 250,000 per sq m Car spaces RUB 3,000,000 per sq m
P. 90 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 31. Paradniy Quarter, bldgs. 17, 18 Main characteristics Market Value: RUB 1,333,911,000 City: Saint-Petersburg 1-3, Paradnaya St./ Address: 14, Vilensky Lane Inspection date 14.01.2015 Property type: Office center Development stage Completed
Development strategy: Sell % of completion: 100% % of presold: 0% Construction start: 01.10.2006 Construction completion: 01.05.2014 Site area: Part of 9.57 ha
Gross buildable area: 12,047.8 sq m
Description: Status on the date of valuation: Class A office center Office center is a building with historic facade of 4 above ground and 1 underground floors. Office center combines A class office premises and Proposed development scheme: underground parking for 60 car spaces. Office premises are in shall&core. NSA, sq m, as at the Total NSA, sq m 12,047.8 valuation date 12,047.8 sq m Office - Office - Other - Other - Parking, car spaces - Parking, car spaces - A land plot with a total area of 9.57 ha with cadastral number of 78:31:0001210:12 is held on termless right by the Federal State Government Agency ‘North Wes Territorial Administration of the Property Tenure: Relations ‘Ministry of Defense of the Russian Federation’ Office building with a total area of 12,047.8 sq m are held freehold by JSC ‘Stroitelnaya Korporatsia Sankt-Peterburga’ according to the Ownership certificates 78-АZ 558886 dated October 07, 2014. Encumbrances: -
P. 91 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Centralny district of Saint-Petersburg, a short distance of 0.8 km from the Voskresenskaya Emb. and 0.6 km from Suvorovsky Ave. and at a distance of 0.6 km from Chernyshevskaya subway station. The Property is approx. 3.3 km from the city centre (Dvortsovaya Square) and 21 km to Pulkovo Airport. The property is located in the historical center of the city. The housing complex is located ata distance of 1.8 km from the "golden triangle" zone of Saint-Petersburg next to high quality business centers, hotels and cultural attractions. The Tavrichesky Garden, Saltikova Shedrina Garden, Suvorov Museum and a number of educational facilities are in close proximity to the Property. The Property is located at the quarter of new residential complex (Paradny Quarter) and high quality office buildings. Valuation inputs: Methodology: Sales Comparison Approach Special assumption(s): Not applicable Discount rate 15% Outstanding costs: - Market average weighted sales price Office premises RUB 110,718 per sq m net of VAT
P. 92 COLLIERS INTERNATIONAL
Prepared for:
JSC ‘LSR Group’ 32. Kamennoostrovskaya Kollektsiya Main characteristics Market Value: RUB 157,800,000 City: Saint-Petersburg Address: 58-60, Kamennoostrovsky Ave. Inspection date 14.01.2015 Property type: Office building and apart-hotel Development stage Design and permitting
Development strategy: Build and Sell
% of completion: 18% % of presold: 0% Construction start: 01.01.2015 Construction completion: 01.12.2016 Site area: 0.8294 hectares Gross buildable area: 7,866 sq m Description: Status on the date of valuation: The none-residential building is not used. The Property comprises a land plot with buildings of historical and cultural Proposed development scheme: value which are planned to be redeveloped into high-quality business centers with apart-hotel NSA, sq m, as at the Total NSA, sq m, including: 7,866 valuation date, including: 7,866 Office 7,866 Office 7,866 Parking, car spaces/sq m 0 Parking, car spaces/sq m 0 The land plot with a total area of 8,294 sq m, cadastral number 78:7:3207A:12 is held leasehold by LLC ‘Sankt-Peterburgsky gumanitarny delovoy tsentr UNA’ according to the lease agreement Tenure: 15/ZK-0001516 dated July 08,2009. Investment agreement 15-1001515 fir renovation of the existing buildings dated July 08, 2009 and an order 260 dated September 13, 2001 for proplongation of the investment agreement until November 25, 2012. Encumbrances: Control zone of cultural subjects
P. 93 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Petrogradsky district of Saint-Petersburg, at the frontage line of Kamennosotrovsky Ave., a short distance of 0.5 km from the Pesochnaya Emb. and 0.8 km from Petrogradskaya subway station. The Property is approx. 5 km from the city centre (Dvortsovaya Square) and 25 km to Pulkovo Airport. The property is located in the historical center of the city. The Property is located next to high quality business centers, residential complexes and cultural attractions. The Lopuhinsky Garden, Vyazemsky Garden, Kamenny Island are in close proximity to the Property. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Discount rate: 20% Outstanding costs: RUB 998,347,269 inclusive of VAT Market average weighted sales price Office building RUB 170,000 per sq m
P. 94 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’ 7. COUNTRY HOUSES. SAINT- PETERSBURG PROPERTIES IN THE COURSE OF DEVELOPMENT
33. Repino-Leninskoe: Phase 3 – Bolshoy Alakul Main characteristics
Market Value: RUB 216,800,000 City: Leningrad region Land plot #1, 2, 10-12, Alakul village, Leninskoe settlement, Address: Pervomaiskoe municipal district, Viborgsky district, Leningrad region Inspection date 16.01.2015 Land plot for country house Property type: development Development stage Design and permitting Development strategy: Sell % of completion: 87% % of presold: 0% Construction start: 01.02.2011 Construction completion: 31.12.2015 Site area: 75.8417 ha
Gross buildable area: -
Description: Status on the date of valuation: Land plots are on the market. Land plots are free from the buildings. The Property consists of several land plots with a total area of 75.8417 ha (0.236 ha, 0.0916 ha, 46.407 ha, 12.77 ha, 3.77 ha, 12.57 ha). Proposed development scheme: Land plots are intended for sale for future country house development. According to the Client`s data land plots are supplied with design and permitting. Total Net Sellable Area, sq m 758,417 A land plots #1 (part 1, 2, 3) with a total area of 467,346 sq m, cadastral numbers 47:01:1706001:3763, 47:01:1706001:3764, 47:01:1706001:3765, are held freehold by LLC ‘Osobnyak’ according to the Ownership certificate 47 AV 073735 dated January 01, 2011. A land plot #2 with a total area of 127,715 sq m, cadastral number 47:01:17-06-001:0878, is held freehold by LLC ‘Osobnyak’ according to Tenure: the Ownership certificate 47 AV 007372 dated January 01, 2011. A land plot #11 with a total area of 37,674 sq m, cadastral number 47:01:17-06-001:0160, is held freehold by LLC ‘Osobnyak’ according to the Ownership certificate 47 AV 007369 dated January 21, 2011. A land plot #11 with a total area of 125,685 sq m, cadastral number 47:01:17-06-001:0162, is held freehold by LLC ‘Osobnyak’ according to the Ownership certificate 47 AV 007370 dated January 021, 2011. Encumbrances: - P. 95 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Viborgsky district of Leningrad region, at a distance of 3 km from the border with Saint Petersburg. The land plots have good transport accessibility in view of location at a distance of 0.2-1.5 km from Scandinavia Highway (A-181), 5 km from the West High-Speed Diameter (ZSD), 5 km from Zelenogorskoe Ave., 5.5 km from Repino railway station. The Property is situated at a distance 10 km from Sestroretsk town (Kurortny district of Saint Petersburg) and 32 km from residential block of Primorsky district of Saint Petersburg. The nearest subway stations (Komendantsky Prospekt and Propspekt Prosveshnia) are situated at a distance of 30 km from the Property. The Property is approx. 40 km from the city centre (Dvortsovaya Square) and 60 km to Pulkovo Airport. Proximity to Finnish Gulf (7 km) and Kurortny district (3 km) defines commercial attractiveness of out of town residential development. The Property is surrounded be new construction country side settlements (Park way, Repinskaya usadba, Novy mir, Akhmatovo). Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): Not applicable Discount rate: 15% Outstanding costs: RUB 64,374,979 inclusive of VAT Market average weighted sales price For other development RUB 500 per sq m
P. 96 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’ 8. COMMERCIAL PROPERTIES. MOSCOW EXISTINGS BUILDINGS
34. Davydkovskaya Street, 16 Main characteristics Market Value: RUB 315,246,000 City: Moscow Address: 16, Davydkovskaya Street Inspection date 14.01.2015 Property type: Commercial and parking space Development stage Completed
Development strategy: Hold % of completion: 100% % of presold: 91% Site area: 1.1358 hectares Gross buildable area: 41,819 sq m Description: The subject is the basement and ground floor commercial space of Status on the date of valuation: 1,737.2 sq m and underground parking space (6 car spaces) situated in a business class high-rise residential building. A business class high-rise residential complex and underground floors, Proposed development scheme: with commercial space and underground parking NSA, sq m, as at the valuation Total NSA, sq m, including: 19,090 date, including: 1,737 Residential 17,353 Residential 0 Offices 1,737 Offices 1,737 Parking, car spaces 130 Parking, car spaces 6 Commercial spaces with a total area of 1,737.2 sq m is held freehold by A Plus Estate CJSC in accordance with the Certificates of state registration of freehold: title 77-AР 619732 dated July 25, 2014 for space with a total area of 3.7 sq m; title 77-AР 619733 dated July 25, 2014 for space with a total area of 406.1 sq m; Tenure: title 77-AР 619734 dated July 25, 2014 for space with a total area of 342.2 sq m; title 77-AР 619735 dated July 25, 2014 for space with a total area of 273.3 sq m; title 77-AР 619736 dated July 25, 2014 for space with a total area of 308.4 sq m; title 77-AР 619737 dated July 25, 2014 for space with a total area of 403.5 sq m Encumbrances: no
P. 97 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’ Location
The Property is located in the Davydkovo District in the Western AD of Moscow, within 1 km from Kutuzovsky Avenue and 2 km from Slavyansky Boulevard metro station. The Property is located in close proximity to the the park and the river Setun. The immediate environment of the Property includes residential buildings, and a lot of variable amenities such as Perekryostok, Sportmaster, M-Video stores; the Mozhaisky retail centre and the luxury shopping centre Four Seasons, the Vereiskaya Plaza BC and etc. Valuation inputs: Methodology: Sales Comparison Approach and DCF method Special assumption(s): not applicable Discount rate 14% Market average weighted sales price Commercial RUB 186,000 per sq m Parking RUB 2,425,000 per car space
P. 98 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’
35. Tverskoy Boulevard, 16 Main characteristics Market Value: RUB 1,229,986,000 City: Moscow Address: 16, Tverskoy Boulevard Inspection date 14.01.2015 Property type: Office building Development stage Completed
Development strategy: Hold % of completion: 100% % of presold: 0%
Site area: 0.14 hectares Gross buildable area: 4,903.8 sq m Gross buildable area 4,844 sq m (LSR Groupe part): Description: The Property comprises an office building of four above ground and two Status on the date of valuation: underground floors extending to a total area of 4,903.8 sq m and 30 underground parking slots Proposed development scheme: An office building and 30 underground parking slots NSA, sq m, as at the valuation Total NSA, sq m, including: 4,844 4,844 date, including: Offices 2,651 2,651 Parking, car spaces/sq m 30 Parking, car spaces/sq m 30 The landplot (cadastral number 77:01:0106:90:74) is held on a long- term lease according to Land lease agreement M-01-039326 dated Tenure: December 14, 2012 expiring on October 24, 2061; The subject building is held co-freehold by MTO Arkhproyekt OJSC and the City of Moscow with a 98.7% and a 1.3% stake respectively. Encumbrances: no Location
P. 99 COLLIERS INTERNATIONAL
Prepared for: The Property is is located on the Boulevard Ring in the Central AD of Moscow in close proximity to the metro JSC ‘LSR Group’ stations: Pushkinskaya, Tverskaya and Chekhovskaya. Private and public transport access is easy and convenient due to the situation a short distance from Tverskaya Street. The building was constructed in the first half of the 19 century and completely renovated in 2004-2005, preserving the facade and historic cast-iron stairs. The immediate environment of the Property includes residential buildings as well as mansions of the XIX and XX centuries, office and street retail uses, as well as by social and cultural amenities Valuation inputs: Methodology: Sales Comparison Approach Special assumption(s): not applicable Discount rate not applicable Market rent rates Commercial RUB 253,920 per sq m net of VAT Parking -
P. 100 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’ 9. RESIDENTIAL PROPERTIES. MOSCOW PROPERTIES IN THE COURSE OF DEVELOPMENT BUSINESS CLASS RESIDENTIAL
36.Leningradskoye Shosse 58 Main characteristics Market Value: RUB 1,703,687,000 City: Moscow bld. 14, 21, 58 Leningradskoye Address: Highway Inspection date 15.01.2015 Business class residential Property type: complex Development stage Initial concept & planning docs
Development strategy: Build and Sell
% of completion: 19% % of presold: 0% Construction start: 01.09.2015 Construction completion: 01.12.2017 Site area: 1.7656 hectares
Gross buildable area: 80,202 sq m
Description: The subject site is of irregular shape, with administrative and industrial Status on the date of valuation: buildings intended for demolition A business class high-rise residential complex of 40 above ground and 4 Proposed development scheme: underground floors, with commercial space and underground parking NSA, sq m, as at the Total NSA, sq m, including: 36,880 valuation date, including: 36,880 Residential 26,046 Residential 26,046 Commercial 10,834 Commercial 10,834 Parking, car spaces//sq Parking, car spaces/sq m 664 664 m The site with a total area of 1.7656 hectares (cadastral number: 77:09:0001020:2503) is held freehold by LSR Nedvizhimost-M CJSC in Tenure: accordance with the Certificate of state registration of freehold title 77-AР 655837 dated June 11, 2014. Construction and renovation is banned at the part of the subject site ( Encumbrances: 0.96 hectares) (former cadastral number:77:09:0001020:71)
P. 101 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Northern AD of Moscow, a short 0.3 km distance from Leningraskoye Highway (second row of buildings) and Vodny Stadion metro station (approx. 0.5 km). The Property is approx. 12 km from the city centre and 15 km to Sheremetyevo Airport. Besides Leningraskoye Highway, another main transport artery of the district - Golovinskoye Highway – is a short distance from the Property. The Property is situated on the territory of the Scientific and Research Institute of Machinery Manufacturing, which is intended to be redeveloped with residential and social amenity uses in the future. To the north the Property borders a new residential area, to the south - two retail centres, one of which is a large retail centres trading in children’s goods, to the east - the former industrial area to be built up with residential uses, and to the west - Leningradskoye Highway and the recreational area of the Moskva River port. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate 25.0% Outstanding costs: RUB 4,084,346,268 inclusive of VAT Market average weighted sales price Residential RUB 183,000 per sq m Commercial RUB 160,000 per sq m Parking RUB 1,350,000 per car space
P. 102 COLLIERS INTERNATIONAL
Prepared for: 37. JSC ‘LSR Group’ Donskoy Olymp Main characteristics
Market Value: RUB 7,578,438,000 As is City: Moscow Address: 19 Serpukhovsky Val Street Inspection date Business class residential Property type: complex Development stage Construction
Development strategy: Build and Sell
The project % of completion: 47% % of presold: 37% Construction start: 01.05.2013 Construction completion: 01.12.2016 Site area: 4.72 hectares
Gross buildable area: 239,050 sq m
Description: The subject site is of irregular shape, fenced, with foundation works in Status on the date of valuation: progress A business class residential complex of four buildings comprising from 3 Proposed development scheme: to 18 above ground floors and a multi-level underground parking, with commercial space and a three-store commercial building. NSA, sq m, as at the Total NSA, sq m, including: 85,316 53,945 valuation date, including: Residential 75,542 Residential 45,529 Commercial 6,073 Commercial 4,716 Other 3,701 Other 3,701 Parking, car spaces//sq Parking, car spaces/sq m 1,300 1,125 m Investment contract 15-03/2011-MK9 dated April 6, 2011 between LSR Nedvizhimost-M CJSC (Developer) and Coalco-Development Moscow LLC (Investor). A land plot with a total area of 4.72 ha (cadastral number: 77:05:0001011:8) is held leasehold by LSR Nedvizhimost-M CJSC as Tenure: certified by Land lease agreement KДМ 01-09/2013 dated September 4, 2013 between LSR Nedvizhimost-M CJSC (Tenant) and Coalco- Development Moscow LLC (Landlord) and expiring on October 29,2017. The share of LSR Nedvizhimost-M CJSC in the project constitutes 71.45%. Encumbrances: n/a
P. 103 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in one of the central and prestigious districts of Moscow - Danilovsky District of the Southern Administrative District. Situated within 1 km from the Third Transport Ring and Shabolovskaya and Tulskaya metro stations, the Property benefits from good transport accessibility. The Property is situated in a long-established, quiet and ecologically friendly residential neighbourhood with accompanying amenities. Donskoy Monastery and several industrial micro-zones are in close proximity to the site. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate 20.0% Outstanding costs: RUB 6,831,228,259 inclusive of VAT Market average weighted sales price Residential RUB 247,000 per sq m Commercial RUB 210,000 per sq m Other RUB 75,000 per sq m Parking RUB 1,800,000 per car space
P. 104 COLLIERS INTERNATIONAL
Prepared for: 38. JSC ‘LSR Group’ Grunvald Main characteristics Market Value: RUB 541,739,000 City: Moscow Region the Zarechye Settlement, the Address: Odintsovo District of the Moscow Region Inspection date Property type: Business class residential complex Development stage Completed and partly sold
Development Build and Sell strategy: % of completion: 99% % of presold: 90% Construction start: 01.03.2005 Construction 01.01.2011 completion: Site area: 4.1 hectares Gross buildable 58,331 area:
Description: Status on the date of valuation: The subject site completed A business-class residential complex comprising 13 high-rise Proposed development scheme: buildings of 6-7 floors and a commercial and amenity centre with a fitness and welfare centre. NSA, sq m, as at the Total NSA, sq m, including: 27,260 2,755 valuation date, including: Residential 25,011 Residential 1,104 Commercial 744 Commercial 593 Other 1,505 Other 1,058 Parking, car spaces//sq Parking, car spaces/sq m 270 113 m
The land plot with a total area of 4.1 hectares (50:20:002 02 Tenure: 02:0114) is held co-freehold by flat and commercial premises owners, including LSR Nedvizhimost-M CJSC.
Water protection zone of the Setun River (approx. 7,647 sq m); gas Encumbrances: piping protection zone (approx. 6,007 sq m)
P. 105 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Moscow Region, within 1.5 km to the MKAD and 0.4 km to the Zarechye settlement and is linked with Moscow via Skolkovskoye Highway It also has a convenient access via the MKAD, thorough the Zarechye settlement. There are also several public transport routes - buses and mini-buses – commuting between the Property and Kievskaya and Park Pobedy metro stations with an average travel time of 15-20 minutes. The Property’s location in the western, ecologically friendly green zone built up with elite-class cottage settlements, close to the Skolkovo School of Business, retail amenities (the OK and Metro C&C stores) and varied educational amenities (kindergartens, the Sokrat private school and the Rosinka boarding school). Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate 15.0% Outstanding costs: RUB 24,837,228 inclusive of VAT Market average weighted sales price Residential RUB 200,000 per sq m Commercial RUB 120,000 per sq m Parking RUB 1,700,000 per car space Other RUB 70,000 per sq m
P. 106 COLLIERS INTERNATIONAL
Prepared for: 39. JSC ‘LSR Group’ ZIL Main characteristics As is Market Value: RUB 19,528,755,000 City: Moscow Address: 23, Avtozavodskaya Street Inspection date Business class residential Property type: complex Development stage Initial concept & planning docs
Development Build and Sell strategy: The project % of completion: 3% % of presold: 0% Construction start: 01.07.2015 Construction 01.12.2023 completion: Site area: 65.087 hectares
Gross buildable 1,458,797 sq m area:
Description: The subject site is of irregular shape, with administrative and Status on the date of valuation: industrial buildings intended for demolition A business class high-rise residential complex of 6-12 floors, with Proposed development scheme: commercial space and underground parking NSA, sq m, as at the Total NSA, sq m, including: 951,753 951,753 valuation date, including: Residential 760,070 Residential 760,070 Commercial 191,683 Commercial 191,683 Parking, car spaces//sq Parking, car spaces/sq m 12,936 12,936 m The site with a total area of 65.087 hectares is held leasehold by PROMOBJECT CJSC in accordance with the following Land lease agreements: A land plot with a total area of 22,907 sq m (cadastral number 77:05:0002004:3252) is held leasehold by PROMOBJECT CJSC according to Land lease agreement М-05-045473 dated October 7,2014 and expiring on August 18,2063; A land plot with a total area of 6,500 sq m (cadastral number 77:05:0002004:3247) is held leasehold by PROMOBJECT CJSC according to Land lease agreement М-05-045499 dated October 15,2014 and expiring on August 18,2063; Tenure: A land plot with a total area of 17,072 sq m (cadastral number 77:05:0002004:3246) is held leasehold by PROMOBJECT CJSC according to Land lease agreement М-05-045500 dated October 15,2014 and expiring on August 18,2063; A land plot with a total area of 14,738 sq m (cadastral number 77:05:0002004:3235) is held leasehold by PROMOBJECT CJSC according to Land lease agreement М-05-045501 dated October 15,2014 and expiring on August 18,2063; A land plot with a total area of 8,927 sq m (cadastral number 77:05:0002004:3253) is held leasehold by PROMOBJECT CJSC according to Land lease agreement М-05-045502 dated October 15,2014 and expiring on P. 107 COLLIERS INTERNATIONAL
Prepared for: August 18,2063; JSC ‘LSR Group’ A land plot with a total area of 16,682 sq m (cadastral number 77:05:0002004:3251) is held leasehold by PROMOBJECT CJSC according to Land lease agreement М-05-045503 dated October 15,2014 and expiring on August 18,2063; A land plot with a total area of 17,071 sq m (cadastral number 77:05:0002004:3234) is held leasehold by PROMOBJECT CJSC according to Land lease agreement М-05-045504 dated October 15,2014 and expiring on August 18,2063; A land plot with a total area of 4,808 sq m (cadastral number 77:05:0002004:3249) is held leasehold by PROMOBJECT CJSC according to Land lease agreement М-05-045505 dated October 15,2014 and expiring on August 18,2063; A land plot with a total area of 31,420 sq m (cadastral numbers 77:05:0002004:3227, 77:05:0002004:3241 and 77:05:0002004:3242) is held leasehold by PROMOBJECT CJSC according to Land lease agreement М-05-045506 dated October 15,2014 and expiring on August 18,2063; A land plot with a total area of 30,741 sq m (cadastral number 77:05:0002004:3226) is held leasehold by PROMOBJECT CJSC according to Land lease agreement М-05-045536 dated October 23,2014 and expiring on August 18,2063; A land plot with a total area of 51,529 sq m (cadastral numbers 77:05:0002004:3223, 77:05:0002004:3224 and 77:05:0002004:3225) is held leasehold by PROMOBJECT CJSC according to Land lease agreement М-05-045537 dated October 23,2014 and expiring on August 18,2063; A land plot with a total area of 54,587 sq m (cadastral numbers 77:05:0002004:3222, 77:05:0002004:3258 and 77:05:0002004:3218) is held leasehold by PROMOBJECT CJSC according to Land lease agreement М-05-045538 dated October 23,2014 and expiring on August 18,2063; A land plot with a total area of 31,353 sq m (cadastral numbers 77:05:0002004:3236, 77:05:0002004:3237 and 77:05:0002004:3238) is held leasehold by PROMOBJECT CJSC according to Land lease agreement М-05-045541 dated October 23,2014 and expiring on August 18,2063; A land plot with a total area of 48,363 sq m (cadastral numbers 77:05:0002004:3228 and 77:05:0002004:3233) is held leasehold by PROMOBJECT CJSC according to Land lease agreement М-05-045544 dated October 23,2014 and expiring on August 18,2063; A land plot with a total area of 16,628 sq m (cadastral number 77:05:0002004:3244) is held leasehold by PROMOBJECT CJSC according to Land lease agreement М-05-045546 dated October 23,2014 and expiring on August 18,2063; A land plot with a total area of 16,177 sq m (cadastral number 77:05:0002004:3245) is held leasehold by PROMOBJECT CJSC according to Land lease agreement М-05-045547 dated October 23,2014 and expiring on August 18,2063; A land plot with a total area of 13,142 sq m (cadastral number 77:05:0002004:3239) is held leasehold by PROMOBJECT CJSC according to Land lease agreement М-05-045549 dated October 23,2014 and expiring on August 18,2063; A land plot with a total area of 96,233 sq m (cadastral numbers 77:05:0002004:3220, 77:05:0002004:3221, 77:05:0002004:3240, 77:05:0002004:3243, P. 108 COLLIERS INTERNATIONAL
Prepared for: 77:05:0002004:3248, 77:05:0002004:3254, JSC ‘LSR Group’ 77:05:0002004:3256 and 77:05:0002004:3257) is held leasehold by PROMOBJECT CJSC according to Land lease agreement М-05-045552 dated October 23,2014 and expiring on August 18,2063; A land plot with a total area of 9,947 sq m (cadastral number 77:05:0002005:3019) is held leasehold by PROMOBJECT CJSC according to Land lease agreement М-05-044956 dated May 30,2014 and expiring on April 25,2063; A land plot with a total area of 19,913 sq m (cadastral number 77:05:0002005:3018) is held leasehold by PROMOBJECT CJSC according to Land lease agreement М-05-044955 dated May 30,2014 and expiring on April 25,2063. Encumbrances: n/a Location
The Property is located in the Southern AD of Moscow, on Avtozavodskaya Street, a 0.7-1.2 km distance from Avtozavodskaya metro station. The Property is situated on the north part of former territory of the AMO ZIL plant, which is intended to be redeveloped with residential and social amenity uses in the future. To the north the Property borders the Third Transport Ring (TTK), to the east and south - the Moscow Little Ring Railway (a ring-shaped railway which encircles the center of Moscow) and to the west - the channel of the Moskva River. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate 30.0% Outstanding costs: RUB 136,800,281,561 inclusive of VAT Market average weighted sales price Residential RUB 210,000 per sq m Commercial RUB 180,000 per sq m Parking RUB 1,350,000 per car space
P. 109 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’ 10. MASS MARKET RESIDENTIAL
40. Vzlet Main characteristics Market Value: RUB 6,981,849,000 City: Moscow 6, Proizvodstvennaya Street, Address: the Western AD Inspection date Mass-market residential Property type: complex Development stage Design and permitting
Development Build and Sell strategy: % of completion: 3% % of presold: 0% Construction start: 01.09.2015 Construction 01.09.2021 completion: Site area: 39.6182 hectares Gross buildable 1,000,000 sq m area:
Description: The subject site is of irregular shape, with administrative and Status on the date of valuation: industrial buildings intended for demolition A comfort-class residential complex of high-rise buildings of up to Proposed development scheme: 25 floors with social amenities and a retail centre. The project is intended to be developed over five phases. NSA, sq m, as at the Total NSA, sq m, including: 470,459 470,459 valuation date, including: Residential 344,132 Residential 344,132 Commercial 126,327 Commercial 126,327 Parking, car spaces//sq Parking, car spaces/sq m 5,500 5,500 m A land plot with a total area of 360,221 sq m (cadastral number 77:07:0015007:27) is held leasehold by LSR Nedvizhimost-M CJSC according to Land lease agreement М-07-800207c dated February 5, 2009 and expiring on May 20,2057; A land plot with a total area of 36,167 sq m (cadastral number Tenure: 77:07:0015006:102) is held freehold by LSR Nedvizhimost-M CJSC in accordance with the Certificate of state registration of freehold title 77-AР 701352 dated October 10, 2014. The share of LSR Nedvizhimost-M CJSC in the project constitutes 85.5%. Encumbrances: n/a
P. 110 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’ Location
The Property is located in the Western administrative district of Moscow, on Proizvodstvennaya Street. A metro station - Solntsevo – is planned to be constructed within a short walking distance of the Property in the end of 2017.The Property is situated on former territory of the NPO Vzlet plant, which is intended to be redeveloped with residential and social amenity uses in the future.To the north of the Property borders is Aviatorov Street, to the east and west are industrial territoties and to the south is an electric engine house of Solntsevo metro station under construction. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate 25% Outstanding costs: RUB 39,540,446,019 inclusive of VAT Market average weighted sales price Residential RUB 135,000 per sq m Commercial RUB 105,000 per sq m Parking RUB 750,000 per car space
P. 111 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’
41. iBitsa Main characteristics Market Value: RUB 4,991,658,000 As is City: Moscow Bachurino Village, the Address: settlement of Sosenskoye, the Novomoskovsky AD Inspection date Mass-market residential Property type: complex Development stage Design and permitting
Development Build and Sell strategy: % of completion: 2% The project % of presold: 0% Construction start: 01.03.2015
Construction 30.11.2020 completion:
Site area: 59.85 hectares
Gross buildable 571,363 sq m area:
Description: The site is of irregular shape, is partly wooded, with the Bitsa River Status on the date of valuation: in the north of the Property running from the west to the east. A comfort-class residential complex of high-rise buildings of 6-9 Proposed development scheme: floors with social amenities and a retail and office centre. The project is intended to be developed over five phases. NSA, sq m, as at the Total NSA, sq m, including: 280,766 280,766 valuation date, including: Residential 208,705 Residential 208,705 Other 4,061 Other 4,061 Commercial 68,000 Commercial 68,000 Parking, car spaces 3,086 Parking, car spaces 3,086 The land plot with a total area of 59.85 hectares is held by Verkros LLC on a long-term leasehold (49 years) as certified by Land lease agreement 13022-Z dated July 22, 2004. Tenure: Investment contract 1-11/2010-ИНП dated November 18, 2010 between LSR Nedvizhimost-M CJSC (Developer), Verkros LLC and Lesnaya Kompaniya LLC. The share of LSR Nedvizhimost-M CJSC in the project constitutes 85%. Height restrictions R-30 and R-10 from Vnukovo and Ostafyevo Airports respectively; protection zone of the Vnukovo Airport; water protection zones of the Bitsevsky pond and three creeks; Encumbrances: protection zone of the Znamenskoye-Sadki estate of historical and cultural heritage; protection zones of overhead power lines 110 KV and 220 KV; on-site foliage, etc.
P. 112 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the Novomoskovsky AD of the Moscow, in the Bitsevsky Forest nature park. Situated on the outer side of the MKAD, the Property has direct, convenient access from the thoroughfare. There is a bus stop on the MKAD a short distance from the subject site. In the south-east the Property borders the Severnoe Butovo District of Moscow, in the east - the Znamenskoye-Sadki estate, which is of historical and cultural heritage, in the west – the Bachurino Village. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate 25% Exit yield (for retail and office 12,5% centre) Outstanding costs: RUB 19,776,818,551 inclusive of VAT Market average weighted sales price Residential RUB 120,000 per sq m Commercial RUB 105,000 per sq m Parking RUB 650,000 per car space
P. 113 COLLIERS INTERNATIONAL
Prepared for: 42. JSC ‘LSR Group’ Podolsk-Yerino Main characteristics Market Value: RUB 1,368,665,000 City: Moscow near the Salkovo Village, the Address: Ryazanovskoye Settlement, the Novomoskovsky AD Inspection date Mass-market residential Property type: complex Development stage Initial concept & planning docs
Development Build and Sell strategy: % of completion: 0% % of presold: 0% Construction start: 01.08.2016 Construction 01.12.2022 completion: Site area: 97.762 hectares Gross buildable 900,720sq m area:
Description: The land plots constituting the subject site are greenfield sites Status on the date of valuation: almost regular in shape. A mass-market residential complex comprising low-rise buildings of Proposed development scheme: up to 5 floors with social amenities. NSA, sq m, as at the Total NSA, sq m, including: 358,800 358,800 valuation date, including: Residential 303,600 Residential 303,600 Commercial 55,200 Commercial 55,200 Parking, car spaces 4,112 Parking, car spaces 4,112 A land plot with a total area of 443,602 sq m (cadastral number 77:20:0020441:55) is held freehold by Podolsky Sad agricultural cooperative in accordance with the Certificate of state registration of freehold title 77-AР 138511 dated November 15, 2013; A land plot with a total area of 100,000 sq m (cadastral number 77:20:0020441:56) is held freehold by Podolsky Sad agricultural cooperative in accordance with the Certificate of state registration of freehold title 77-AР 138510 dated November 15, 2013; Tenure: A land plot with a total area of 433,460 sq m (cadastral number 77:20:0020441:443 is held freehold by Podolsky Sad agricultural cooperative in accordance with the Certificate of state registration of freehold title 50-AГ 138510 dated December 19, 2011. Investment contract 01/13 dated December 26, 2013 between LSR Nedvizhimost-M CJSC (Developer) and Podolsky Sad agricultural cooperative (Investor). The share of LSR Nedvizhimost-M CJSC in the project constitutes 69%. Encumbrances: n/a
P. 114 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is situated 15 km from the MKAD via Varshavskoye Highway, within 4 km to Podolsk railway station. It is situated to the north-west of Podolsk, between the Yerino settlement in the north and the Pakhra River and the town of Podolsk in the south. The settlement of Salkovo is situated between the two land plots comprising the Property. Access is most convenient by private transport, which is expected to further improve with the completion of the Southern by-pass road in 2015-2016. The social and other amenities of Podolsk are a convenient commuting distance from the Property. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate 25% Outstanding costs: RUB 23,023,493,081 inclusive of VAT Market average weighted sales price Residential RUB 73,500 per sq m Commercial (net of VAT) RUB 75,000 per sq m Parking RUB 450,000 per car space
P. 115 COLLIERS INTERNATIONAL
Prepared for: 43. JSC ‘LSR Group’ Novoye Domodedovo Main characteristics Market Value: RUB 603,241,000 Domodedovo, the Moscow City: Region the Zapadny Microdistrict of the Address: Domodedovo Inspection date Mass-market residential Property type: complex Development stage Construction
Development Build and Sell strategy: % of completion: 69% % of presold: 77% Construction start: 01.08.2011 Construction 01.12.2016 completion: Site area: 39.3345 hectares Gross buildable 564,517 sq m area: escription: The site is of irregular shape, partly wooded, with construction of a Status on the date of valuation: large-scale residential complex in progress. A mass-market residential complex comprising 26 high-rise Proposed development scheme: buildings of 9-17 floors with social and sports amenities and multi- level car parks. NSA, sq m, as at the Total NSA, sq m, including: 315,721 72,870 valuation date, including: Residential 303,846 Residential 67,678 Commercial 11,875 Commercial 5,192 The site comprised of 25 land plots with a total area of 303,801 sq m (cadastral numbers: 50:28:000000:599, 50:28:000000:600; 50:28:000000:601; 50:28:000000:602; 50:28:000000:603, 50:28:000000:604, 50:28:000000:605, 50:28:000000:606, 50:28:000000:607, 50:28:000000:608, 50:28:000000:609, 50:28:000000:610, 50:28:000000:611, 50:28:000000:612, 50:28:000000:613, 50:28:000000:614, 50:28:000000:615, 50:28:000000:616, 50:28:000000:617, 50:28:000000:618, 50:28:000000:619, 50:28:000000:620, 50:28:000000:621, 50:28:000000:622 and 50:28:000000:623) is held leasehold by Tenure: LSR Nedvizhimost-M CJSC according to Land lease agreement dated October 16, 2012 and expiring on December 31,2017; A land plot with a total area of 89,544 sq m (cadastral number 50:28:0060113:76) is held freehold by LSR Nedvizhimost-M CJSC in accordance with the Certificate of state registration of freehold title 50 АД No 689680 dated December 21, 2012. Investment contract 01-02/2011-МКЮ dated February 1, 2011 between LSR Nedvizhimost-M CJSC (Developer), and Bolshoye Domodedovo LLC (Investor). The share of LSR Nedvizhimost-M CJSC in the project constitutes 89%. Encumbrances: n/a
P. 116 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is situated a short distance from Route M-4 Don, 18 km from the MKAD, 10 km from Domodedovo Airport and 3 km from railway stations Vostryakovskaya and Vzlentaya of Paveletskaya railway service. Access is most convenient by private transport, however, upon completion of the proposed scheme, public transport routes will commute between the Property and Vzlentaya railway station. The Property is located in an ecologically friendly zone comprising the preserved areas of Barybinskoye forestry, Bortnevsky, Stepyginsky and Akulinsky parks, which are located within walking distance from the Property. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate 17% Outstanding costs: RUB 5,092,757,560 inclusive of VAT Market average weighted sales price Residential RUB 64,500 per sq m Commercial (net of VAT) RUB 75,000 per sq m
P. 117 COLLIERS INTERNATIONAL
Prepared for: 44. JSC ‘LSR Group’ Novoye Nakhabino Main characteristics Market Value: RUB 137,052,000 City: Moscow Region near the Chernaya Village, the Pavlovo-Posadskoye Address: Settlement, the Istra District of the Moscow Region Inspection date Mass-market residential Property type: complex Development stage Construction
Development Build and Sell strategy: % of completion: 94% % of presold: 90% Construction start: 02.10.2010 Construction 03.12.2015 completion: Site area: 15.301 hectares Gross buildable 70,503 sq m area:
Description: Status on the date of valuation: The site is of irregular shape, partially woodwed. A mass-market low-rise residential complex comprising 66 Proposed development scheme: residential buildings of 2-3 floors and a commercial and amenity centre. NSA, sq m, as at the Total NSA, sq m, including: 40,840 3,955 valuation date, including: Residential 33,398 Residential 3,141 Commercial 483 Commercial 130 Other (storage) 6,959 Other 683
A land plot with a total area of 153,010 sq m is held freehold by Tenure: LSR Nedvizhimost-M CJSC.
Encumbrances: n/a
P. 118 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the north-west of the Moscow Region, in the Istrinsky District, close to the Nakhabino Village, approx. 20 km from the MKAD, 5 km from the Pavlovskaya Sloboda Village and 4 km of the town of Dedovsk. The property is linked with Moscow by two highways - Novorizhskoye and Volokolamskoee Highways (an average of 30 and 60 minute drive to the city centre respectively). The Property can also be reached by public transport - by train (to Nakhabino train station, then a 10 minute drive to the neighborhood) or by bus. The site borders a large forest area, the Nakhabino settlement and the Novy Gorodok residential quarter, which has varied amenities including a public school, two kindergartens, a fitness centre, bowling club, church, nature park, supermarket, beauty salon, entertainment centre and restaurant. Approx. 4 km from the Property are the Pavlovskaya Gymnaziya private school and the Pavlovskoye Podvorye retail centre which includes a supermarket, fitness centre, dry cleaning, restaurants. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate 16% Outstanding costs: RUB 103,274,091 inclusive of VAT Market average weighted sales price Residential RUB 71,500 per sq m Commercial (net of VAT) RUB 73,000 per sq m Auxiliary (storage) RUB 29,000 per sq m
P. 119 COLLIERS INTERNATIONAL
Prepared for: 45. JSC ‘LSR Group’ Nakhabino Yasnoe Main characteristics Market Value: RUB 2,677,123,000 City: Moscow Region near the Chernaya Village, the Pavlovo-Posadskoye Address: Settlement, the Istra District of the Moscow Region Inspection date Mass-market residential Property type: complex Development stage Construction
Development Build and Sell strategy: % of completion: 47% % of presold: 25% Construction start: 01.12.2012 Construction 01.09.2016 completion: Site area: 29.0461 hectares Gross buildable 182,967 sq m area:
Description: Status on the date of valuation: The site is of irregular shape, partially woodwed. A mass-market low-rise residential complex comprising 66 Proposed development scheme: residential buildings of 2-3 floors and a commercial and amenity centre. NSA, sq m, as at the Total NSA, sq m, including: 143,066 107,573 valuation date, including: Residential 138,531 Residential 104,247 Commercial 3,933 Commercial 3,326 Other (storage) 602 Other (storage) 0 Parking 300 Parking 300
A land plot with a total area of 290,461 sq m is held freehold by Tenure: LSR Nedvizhimost-M CJSC.
Encumbrances: n/a
P. 120 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the north-west of the Moscow Region, in the Istrinsky District, close to the Nakhabino Village, approx. 20 km from the MKAD, 5 km from the Pavlovskaya Sloboda Village and 4 km of the town of Dedovsk. The property is linked with Moscow by two highways - Novorizhskoye and Volokolamskoee Highways (an average of 30 and 60 minute drive to the city centre respectively). The Property can also be reached by public transport - by train (to Nakhabino train station, then a 10 minute drive to the neighborhood) or by bus. The site borders a large forest area, the Nakhabino settlement and the Novy Gorodok residential quarter, which has varied amenities including a public school, two kindergartens, a fitness centre, bowling club, church, nature park, supermarket, beauty salon, entertainment centre and restaurant. Approx. 4 km from the Property are the Pavlovskaya Gymnaziya private school and the Pavlovskoye Podvorye retail centre which includes a supermarket, fitness centre, dry cleaning, restaurants. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate 17% Outstanding costs: RUB 4,270,465,569 inclusive of VAT Market average weighted sales price Residential RUB 69,000 per sq m Commercial (net of VAT) RUB 68,000 per sq m Auxiliary (storage) RUB 28,000 per sq m Parking RUB 350,000 per car space
P. 121 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’ 11. COMMERCIAL PROPERTIES. MOSCOW PROPERTIES IN THE COURSE OF DEVELOPMENT
46. Noviy Balchug Main characteristics As is Market Value: RUB 1,900,880,000 City: Moscow bld. 1, 2, 3, 9 Sadovnicheskaya Address: Street Inspection date 14.01.2015 Property type: Multi use complex Development stage Design and permitting
Development strategy: Build and Sell % of completion: 46% % of presold: 0% The project Construction start: 01.04.2014 Construction completion: 01.06.2019 Site area: 0.4 hectares
Gross buildable area: 24,815 sq m
Description: The subject site is of regular shape, with dilapidated residential buildings Status on the date of valuation: with a total area of 7,731.5 sq m intended for demolition. Multi use complex of 6-7 above ground and 3 underground floors Proposed development scheme: comprising business-class apartments, office and retail space, and a car park. NSA, sq m, as at the Total NSA, sq m, including: 12,099 valuation date, including: 12,099 Residential 7,731 Residential 7,731 Office 4,368 Office 4,368 Parking, car spaces 170 Parking, car spaces 170 The land plot with a total area of 0.42 hectares belongs to the City of Moscow; upon construction completion a 49-year lease is intended to be obtained; Investment contract 2-2148/p-2 dated July 13, 2003 between the Tenure: Government of Moscow and Velikan- XXI vek LLC (Investor) is prolonged until June 30, 2014 (as per the Minutes of the Urban Design and Land Committee 11 dated April 4, 2013) to enable completion of relocation of the remaining dwellers and demolition of the existing buildings. Relocation of residential dwellers and owners of non-residential Encumbrances: premises: pro, provision of telephoning to residential dwellers
P. 122 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’
Location
The Property is located on Sadovnicheskaya Street in the Central Administrative District of Moscow, within 0.5 km from the Kremlin and Red Square. The Property is located on the first building line of Sadovnicheskaya Street in close proximity to the Garden Ring, Raushskaya and Sadovnicheskaya Embankment of the Moskva River and the Boulevard Ring. The nearest metro stations - Novokuznetskaya and Tretyakovskaya are a 15 minute walk from the Property. The immediate environment of the Property includes office buildings, residential buildings as well as mansions of the XIX and XX centuries and residential uses. The following properties are a short distance from Property: the Balchug Kempinsky Hotel, the headquarters of the Bank of Russia and RosNeft, and the British Embassy. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate 22% Outstanding costs: RUB 2,218,251,000 inclusive of VAT Market average weighted sales price Residential RUB 560,000 per sq m Commercial RUB 364,000 per sq m Parking RUB 4,800,000 per car space
P. 123 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’ 12. RESIDENTIAL PROPERTIES. YEKATERINBURG PROPERTIES IN THE COURSE OF DEVELOPMENT MASS MARKET RESIDENTIAL
47. Rassvetniy Main characteristics Market Value: RUB 993,413,000 City: Yekaterinburg 40-Letiya Komsomola Street, Address: 2B Inspection date Mass-market residential Property type: complex Development stage Construction
Development Build and Sell strategy:
% of completion: 11% % of presold: 20% Construction start: 01.02.2014 Construction 01.09.2019 completion: Site area: 9.8311 hectares
Gross buildable 253,829 area:
Description: The Property represents a brown-field land plot with a total area Status on the date of valuation: 9.8311 ha intended for construction of an economy class residential complex with a total area of 253,829 sq m. High rise multi-store residential complex with commercial and Proposed development scheme: social infrastructure NSA, sq m, as at the Total NSA, sq m, including: 181,449 145,722 valuation date, including: Residential 181,449 Residential 145,722 . A land plot with a total area of 13,313 sq m (cadastral number 66:41:0705005:6029) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 500975 dated June 6, 2014; . A land plot with a total area of 10,819 sq m (cadastral Tenure: number 66:41:0705005:6028) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 500974 dated June 6, 2014; . A land plot with a total area of 33,036 sq m (cadastral number 66:41:0705005:6027) is held freehold by LSR
P. 124 COLLIERS INTERNATIONAL
Prepared for: Nedvizhimost-Ural in accordance with the Certificate of state JSC ‘LSR Group’ registration of freehold title 66 АЖ 500968 dated June 6, 2014; . A land plot with a total area of 954 sq m (cadastral number 66:41:0705005:6026) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 500953 dated June 6, 2014; . A land plot with a total area of 5,774 sq m (cadastral number 66:41:0705005:6047) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 503212 dated August 6, 2014; . A land plot with a total area of 23,832 sq m (cadastral number 66:41:0705005:6025) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 501070 dated June 6, 2014. Encumbrances: n/a Location
The Property is located to the west of Yekaterinburg, in the Kirovsky Administrative District, the Komsomolskiy residential area, at the intersection of Siromolotova Street, 40-Letya Komsomola Street and Rassvetnaya Street. The site benefits from easy access to the city centre via Syromolotova Street, the main transportation artery of the district. The Property’s location will allow convenient access for private and public transportation. The Kirovsky District has varied social amenities including several children’s nurseries, schools, hospitals, and retail uses. The Property is located within the catchment area of three shopping centres, Sibirsky Trakt, KOR and Stroy Arsenal. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate 20% Outstanding costs: RUB 7,051,532,397 inclusive of VAT Market average weighted sales price Residential RUB 62,500 per sq m
P. 125 COLLIERS INTERNATIONAL
Prepared for: 48. JSC ‘LSR Group’ Khrustalniye Klyuchi Main characteristics Market Value: RUB 906,646,000 City: Yekaterinburg Address: Latviyskaya Street Inspection date Mass-market residential Property type: complex Development stage Construction
Development Build and Sell strategy:
% of completion: 0% % of presold: 6% Construction start: 01.05.2014 Construction 01.09.2019 completion: Site area: 11.0197 hectares
Gross buildable 293,131 area:
Description: The property comprises a green-field site with a total area 11.02 ha Status on the date of valuation: intended for construction of an economy class residential complex with a total area of 293,131 sq m Economy class residential complex of high-rise buildings up to 25 Proposed development scheme: floors with social amenities. NSA, sq m, as at the Total NSA, sq m, including: 217,043 204,425 valuation date, including: Residential 215,865 Residential 203,247 Commercial 1,178 Commercial 1,178 Parking 1,269 Parking 1,269 A land plot with a total area of 11.0197 sq m (cadastral number 66:41:000000:85616) is held leasehold by NOVA-Story CJSC in Tenure: accordance with the land lease agreement №6-1307-T dated 25.05.2012 and Additional Agreement to the land lease Agreement dated October 29,2014 Encumbrances: n/a
P. 126 COLLIERS INTERNATIONAL
Prepared for: Location
JSC ‘LSR Group’
The Property is located in the Oktyabrskiy District, the Kompressorniy residential micro-district at Latviyskaya Street. Kompressorniy District is linked with Yekaterinburg center by Sibirskiy, Tyumenskiy and Novokoltsovskiy Trakts. The Property can be reached from Yekaterinburg center by aeroexpress and commuter trains (20 minutes to Lenina Avenue). The largest enterprises of the district - JSC "Ural Compressor Plant", OJSC "NPP "Start ", LLC " Gazprom Transgas Ekaterinburg ". The infrastructure is quite pure now, but the area has very good developing opportunities after the access issues are been solved. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate 20% Outstanding costs: RUB 9,029,473,846 inclusive of VAT Market average weighted sales price Residential RUB 50,000 per sq m Commercial RUB 55,000 per sq m Parking RUB 325,000 per car space
P. 127 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’ 49. Michurinskiy Main characteristics Market Value: RUB 2,222,765,000 City: Yekaterinburg Address: Sukhodolskaya Street Inspection date Mass-market residential Property type: complex Development stage Construction
Development Build and Sell strategy:
% of completion: 25% % of presold: 21% Construction start: 01.01.2013 Construction 01.12.2017 completion: Site area: 46.9242 hectares
Gross buildable 224,090 area:
Description: The Property comprises a green-field site with patches of trees and undergrowth partly developed by a residential community of low- Status on the date of valuation: rise 3-level buildings. This development also includes social and commercial infrastructure. The residents will benefit from being registered as Yekaterinburg citizens. A residential community of low-rise three-level buildings and social Proposed development scheme: infrastructure. NSA, sq m, as at the Total NSA, sq m, including: 216,109 171,770 valuation date, including: Residential 215,539 Residential 171,200 Commercial 570 Commercial 570 Parking, car spaces 297 Parking, car spaces 297 A land plot with a total area of 32,475 sq m (cadastral number 66:41:0306109:29) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 653003 dated August 19, 2014; A land plot with a total area of 227,951 sq m (cadastral number 66:41:0306109:30) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 653002 dated August 19, 2014; Tenure: A land plot with a total area of 5,867 sq m (cadastral number 66:41:0313009:554) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 650027 dated September 24, 2014; A land plot with a total area of 6,344 sq m (cadastral number 66:41:0313009:553) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 650028 dated September 24, 2014; A land plot with a total area of 12,142 sq m (cadastral number P. 128 COLLIERS INTERNATIONAL
Prepared for: 66:41:0313009:470) is held freehold by LSR Nedvizhimost-Ural in JSC ‘LSR Group’ accordance with the Certificate of state registration of freehold title 66 АЖ 503063 dated August 1, 2014; A land plot with a total area of 125 sq m (cadastral number 66:41:0313009:469) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 502980 dated August 1, 2014; A land plot with a total area of 34,480 sq m (cadastral number 66:41:0313009:331) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 596374 dated June 26, 2014; A land plot with a total area of 7,046 sq m (cadastral number 66:41:0313009:330) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 596373 dated June 26, 2014; A land plot with a total area of 5,774 sq m (cadastral number 66:41:0313009:41) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 138404 dated September 26, 2013; A land plot with a total area of 8,651 sq m (cadastral number 66:41:0313009:40) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 138387 dated September 26, 2013; A land plot with a total area of 328 sq m (cadastral number 66:41:0313009:38) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 138386 dated September 26, 2013; A land plot with a total area of 11,373 sq m (cadastral number 66:41:0313009:36) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 138439 dated September 26, 2013; A land plot with a total area of 205 sq m (cadastral number 66:41:0313009:37) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 138245 dated September 26, 2013; A land plot with a total area of 2,542 sq m (cadastral number 66:41:0313009:35) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 138458 dated September 26, 2013; A land plot with a total area of 21,621 sq m (cadastral number 66:41:0313009:33) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 138468 dated September 26, 2013; A land plot with a total area of 1,445 sq m (cadastral number 66:41:0313009:31) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 138403 dated September 26, 2013; A land plot with a total area of 18,328 sq m (cadastral number 66:41:0313009:30) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 138385 dated September 26, 2013; A land plot with a total area of 3,360 sq m (cadastral number 66:41:0313009:29) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АЖ 275267 dated December 13, 2013; A land plot with a total area of 17,443 sq m (cadastral number 66:41:0313009:21) is held freehold by LSR Nedvizhimost-Ural in accordance with the Certificate of state registration of freehold title 66 АE 803568 dated February 18, 2013; A land plot with a total area of 4,580 sq m (cadastral number 66:41:0313009:18) is held freehold by NOVA-Story CJSC in accordance with the Certificate of state registration of freehold title 66 АE 576211 dated October 8, 2012.
P. 129 COLLIERS INTERNATIONAL
Prepared for: Encumbrances: n/a JSC ‘LSR Group’ Location
The Property is located in the southwest outskirts of Yekaterinburg, close to the rural settlement of Michurinskiy. The subject site’s locale comprises predominantly one-floor private houses. The Property is accessible by well- maintained asphalt, one-lane road. The Property is accessible by a well-maintained asphalted one-lane road. The general plan of the city envisages the construction of a direct access road to the EKAD and construction of roads connecting the Property and Seraphimy Deryabinoy Street., which will be one of the main thoroughfares of the Akademicheskiy residential district. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate 18% Outstanding costs: RUB 6,535,896,585 inclusive of VAT Market average weighted sales price Residential RUB 55,000 per sq m Commercial RUB 60,000 per sq m Parking RUB 300,000 per sq m
P. 130 COLLIERS INTERNATIONAL
Prepared for: 50. JSC ‘LSR Group’ Novgorotsevoy Main characteristics Market Value: RUB 18,820,000 City: Yekaterinburg Address: Novgorodtsevoy Street Inspection date Mass-market residential Property type: complex Development stage Construction
Development Build and Sell strategy:
% of completion: 69% % of presold: 77% Construction start: 01.01.2014 Construction 01.07.2015 completion:
Site area: 0.8836 hectares
Description: The Property represents a land plot with a total area of 0.88 ha Status on the date of valuation: intended for construction of a residential building with a total area of 19,940 sq m. Economy class residential complex of high-rise buildings of 25 Proposed development scheme: floors with social amenities NSA, sq m, as at the Total NSA, sq m, including: 12,490 2,919 valuation date, including: Residential 12,071 Residential 2,547 Commercial 280 Commercial 280 Other (storage) 138 Other (storage) 92 A land plot with a total area 0.8836 ha (cadastral number 66:41:07 05 001:0106) is held leasehold on the basis of the Land Lease Tenure: Agreement #7- 1041 dated February 26, 2007 and Additional Agreement #1 dated August 11, 2010. Encumbrances: n/a
P. 131 COLLIERS INTERNATIONAL
Prepared for: Location JSC ‘LSR Group’
The Property is located in the ZhBI District - a large microdistrict to the east of Yekaterinburg. The region includes the Kameniye Palatki park, where the typical Ural landscape has been maintained: mountain fragments and a pine forest. The park also contains the Shartash Lake - the favorite recreational zone for local residents. The subject site is accessible from the city centre via Malisheva or Komsomolskaya Streets, or the alternative route to the Sibirsky Highway with an average commuting time of between 10-15 minutes. Moreover the Property is linked with the town centre via EKAD Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate 15% Outstanding costs: RUB 171,366,000 inclusive of VAT Market average weighted sales price Residential RUB 68,000 per sq m Commercial RUB 80,000 per sq m Other (storage) RUB 27,000 per sq m
P. 132 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’ 51. Rastochnaya Main characteristics Market Value: RUB 106,132,000 City: Yekaterinburg A quadrant formed by Rastochnaya, Kunarskaya, Address: Kishinevskaya and Bilimbaevskaya Streets Inspection date Mass-market residential Property type: complex Development stage Design and permitting
Development Build and Sell strategy: % of completion: 12% % of presold: 0% Construction start: 01.04.2015 Construction 01.12.2016 completion: Site area: 0.5385 hectares
Gross build area, 13,922 sq. m
Description: The Property is a land plot with a total area of 0.5385 ha intended Status on the date of valuation: for construction of a residential building with a total area of 13,922 sq m. Economy class residential complex of high-rise buildings of 18 Proposed development scheme: floors NSA, sq m, as at the Total NSA, sq m, including: 9,325 9,325 valuation date, including: Residential 9,325 Residential 9,325 Parking, car spaces 50 Parking, car spaces 50 A land plot with a total area of 5,385 sq m (cadastral number 66:41:0204011:3) is held freehold by LSR Nedvizhimost-Ural in Tenure: accordance with the Certificate of state registration of freehold title 66 АЖ 274963 dated December 16, 2013. Encumbrances: n/a Location
P. 133 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’
The Property is located in the Zheleznodorozhniy Administrative District, the Sortirovka residential area. The Property is accessible via Tavatuyskaya Street which connects with Bebelya Street – a busy arterial road of the city. That also connects the Property with Serovskiy Trakt. The nearest amenities are presented by residential buildings and concomitant infrastructure - schools, sport facilities such as Locomotiv Stadion, etc. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate 20% Outstanding costs: RUB 387,270,741 inclusive of VAT Market average weighted sales price Residential RUB 55,500 per sq m Parking RUB 350,000 per car space
P. 134 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’ 52. Flagman Main characteristics Market Value: RUB 436,902,000 City: Yekaterinburg The quarter formed by Repina, Address: N.Vasil’eva and Zavodskaya Streets Inspection date Mass-market residential Property type: complex Development stage Initial concept & planning docs
Development Build and Sell strategy:
% of completion: 6% % of presold: 0% Construction start: 01.04.2015 Construction 01.09.2018 completion: Site area: 3.39 hectares Gross build area, 111,748 sq. m Description: The subject site is of regular shape, with dilapidated tree-store Status on the date of valuation: residential buildings intended for demolition. The subject site is fences as at the valuation date. A Comfort class residential complex with commercial premises and Proposed development scheme: underground parking. NSA, sq m, as at the Total NSA, sq m, including: 70,000 70,000 valuation date, including: Residential 64,626 Residential 64,626 Commercial 5,374 Commercial 5,374 Parking 653 Parking 653 A land plot with a total area of 33,884.32 sq m (cadastral number 66:41:0304007) is held leasehold by LSR Nedvizhimost-Ural in Tenure: accordance with the Agreement on further development 3-9-R dated October 4, 2013 Encumbrances: Relocation of residential dwellers
P. 135 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’ Location
The Property is located in the Verkh-Isetskiy Administrative Distict, the VIZ residential area. The site benefits the convenient access from tree streets forming the land plot: Repina Street, Zavodskaya and N.Vasil’eva Streets. The nearest surroundings are presented by good social and commercial infrastructure: school, 5 nurseries, Hospital # 41, Raduga shopping center, etc. The new residential complex is developed by Aston Group just opposite the subject site. Valuation inputs: Methodology: Residual approach (DCF) Special assumption(s): not applicable Discount rate 20% Outstanding costs: RUB 3,652,841,498 inclusive of VAT Market average weighted sales price Residential RUB 67,500 per sq m Retail (net of VAT) RUB 70,000 per sq m Parking RUB 450,000 per car space
P. 136 COLLIERS INTERNATIONAL
Prepared for: JSC ‘LSR Group’ APPENDIX 4. MARKET OVERVIEW
RUSSIAN INVESTMENT MARKET
Key investment figures in 2014
* Prime commercial real estate, leased at market terms, located in Moscow; with major Russian and international companies tenants
Source: Colliers International
Key trends for 2014 Throughout 2014 the main deterrent for commercial real estate market was geopolitical instability that led to sudden devaluation of domestic currency, rise of the inflation and deceleration in economic growth in the second half of the year. Nevertheless, according to the year results it is evident that Russian and foreign investors continued to search for new investment opportunities, analyse assets and closed transactions on the Russian commercial real estate market.
Overall real estate investment deals volume, 2007-2014, billion $
Source: Colliers International
Usually, closing of the major transactions is completed during the 4th quarter however, in connection with sudden devaluation of the domestic currency lasting through November and December followed by the Central Bank decision increase “key rate” up to 17%, made it difficult to proceed with completion of such transactions. Thus, in case of the
P. 137 COLLIERS INTERNATIONAL
Prepared for: domestic currency stabilization and “key rate” decrease during the 1st quarter of 2015, it JSC ‘LSR Group’ is possible to expect that some transactions that were not finalised in 2014 will be closed.
Capitalisation rates in various segments in Moscow by the end of the year, %
Source: Colliers International
In 2014, the real transactions volume decreased, which was expected given the current market conditions. According to 2014 results, investment volume is estimated at $3.5 billion, which is 60% less in comparison with previous year, when this indicator amounted to $8.2 billion.
Dynamics of deal size distribution, 2008-2014
Source: Colliers International
Decrease in investments activity in 2014 given the economic and political instability was anticipated. Moreover, against many major transactions with trophy assets closed in 2012 and 2013, there increased a number of transactions with a unit cost less than $50 million. Additional factor for the average transaction volume decrease was the limited access to the debt markets during the second half of 2014. P. 138 COLLIERS INTERNATIONAL
Prepared for: During the last several years a number of companies specializing on the commercial real JSC ‘LSR Group’ estate investments were able to create diversified portfolios of prime assets. Which, in turn, attracted institutional investors, who have made several indirect investments in to the commercial real estate. Throughout 2014, investment company Goldman Sachs acquired 12% shares in the O1 Properties, total transaction value amounted to $200 million.
Russian investors also followed same strategy of investing into the existing portfolio. As a result, in the 4th quarter of 2014 with involvement of Colliers International, was completed a milestone investment transaction for the entire European market with a total amount of about €295 million. Investment holding O1 Group Limited owned by Boris Mints, acquired 16.1% equity share and obtained a majority interest in the public investment company CA Immo, portfolio of which is estimated at €3.6 billion and includes assets situated in Germany, Austria and throughout Eastern Europe. This trend demonstrated once again that Russian investors are active in the foreign markets as well, where they are looking for stable returns and risk diversification.
Investment distribution by countries, 2009–2014, billion $
Source: Colliers International
Traditionally, the Russian real estate investment market remains predominantly local. A share of foreign investment in the Russian commercial real estate decreased from 24% in the previous year to 18% according to this year volumes and amounted to approximately $0.6 billion. Despite that, the main international companies which traditionally the most actively investing in the Russian commercial real estate market, such as Hines, Morgan Stanley, Raven Russia, Immofinanz, PPF Group and others, continued to carry out their activity in Russia. Furthermore, we observed increased interest in the Russian market on the part of the Asian and Middle Eastern investors. One of the Middle Eastern sovereign wealth funds acquired Pokrovskiye Kholmy luxury residential complex for about $300-350 million.
P. 139 COLLIERS INTERNATIONAL
Prepared for: Breakdown of real estate investments by region in 2014, % JSC ‘LSR Group’
Source: Colliers International
The investors’ interest in the assets concentrated in Moscow currently remains high – in 2014 85% of transactions were closed in the capital.
Prime capitalization yields in Moscow are estimated at the level of 9.5-10.5% for office and retail segments and at the level of 12-13% – for industrial properties, depending on rental rates, bank financing and cash flow quality. Currently, Russian capital is leading in terms of the capitalization yields level among major European cities, which will eventually attract significant foreign capital, primarily into the Moscow market.
Investments by segment In 2014 a demand reallocation took place – decrease of interest in customarily popular retail and industrial property; investors mainly focused on office segment, where 40% of the total amount of transactions were closed and the investment volume amounted to approximately $1.4 billion.
P. 140 COLLIERS INTERNATIONAL
Prepared for: Investments by segment, billion $ JSC ‘LSR Group’
Source: Colliers International
Since the beginning of the year investment in retail assets amounted to around $1 billion – which is about one third of the total investment volume– besides that, hotels and large residential buildings were also acquired.
Prognosis for 2015 During the first six months the main deterrent for investment transactions will be the “key rate” which is set at17% and was increased four times from 5.5% by the Russian Federation Central Bank during 2014. In this regard it is important to realize that the Central Bank’s three-fold increase of the “key rate” during 2014 is a temporary measure aimed at containment of the inflationary pressure and speculative operations with the foreign currency. It’s most likely that the “key rate” will be decreased after stabilization of the foreign exchange market, oil prices and ambient geopolitical background. As a result, negative consequences for economy and, in particular, for investment market can be minimized.
Despite complicated economic environment in Russia, the major players’ interest in investments in the real estate market has not decreased, and at the moment they are patiently waiting for stabilization of the geopolitical and financial environment within the country.
Russian commercial real estate market continues to be attractive for investment, and the possible reduction of the sanctions, decrease of the “key rate” and stabilization of the oil prices significantly enhance investment appeal of the Russian commercial real estate market.
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Prepared for: Largest investments deals 2014 JSC ‘LSR Group’ Property City Seller Buyer Deal volume Portfolio of Hotel Company(84%) Property Fund of Moscow VTB Capital Confidentially and Hotel Moscow Savoy(16%) Imperia Tower, Moscow MCG Solvers Group $350 - 380 million Phase 1 Pokrovskiye Goldman Sachs Moscow MiddleEast Fund $300- 350 million Kholmy Whitehall Funds River Mall Moscow Bank of Moscow IC Platform $300- 350 million Berlin House and $220- 260 million Geneva House Moscow
(90%) Eastern Property BC Hermitage Confidentially Moscow Holdings $195 million Plaza BC Severnoe Moscow $153 million Siyanie Kuznetskiy most BIN Group of Olympic Tower Moscow 5 billion rub development companies Source: Colliers International
In 2015, the Russian market remains the buyer’s market that offers a great number of opportunities for proactive investors to invest in quality assets in all segments at attractive prices.
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Prepared for: SAINT-PETERSBURG OFFICE MARKET JSC ‘LSR Group’ Key results 2014 Key primary elite residential market indicators in 2014 are represented at the table below
Key primary elite residential market indicators in 2014 Index Value Total stock, million m2 2.30 Completions, thousand m2 212 Net take-up, thousand m2 214 Vacancy, % 11.8 Weighted average rental rates, $/m2/year* Grade A 290 Grade B 210 * Rates include OPEX and exclude VAT
Источник: Colliers International
Supply In 2014, 22 office buildings with a total of 212,000 m² of quality office space were put into operation, which is comparable to the last year’s results when the market increased by 218,000 m². Thus, according to figures for 2014, the total volume of Grade A & B office stock in St. Petersburg reached 2.3 million m², 38.2% of which is Grade A office space.
Currently, projects started in 2013-2014 are still being built. A high level of office space completion is planned for 2015, while a significant decrease in completion volume is expected after that. The commissioning of 30 office buildings with a total leasable area of around 324,000 m² is planned for 2015. Thus, if all the announced projects are completed in time, the total volume of quality office space in the market will increase by 14%.
Over the past three years, including 2014, approximately one third of the total completion volume in St. Petersburg was located in the Moskovskiy district. We expect this proportion to be maintained in 2015.
Primorskiy district is in second place in terms of the construction pipeline. The large-scale office project Lakhta Centre is being built in this part of the city, and the project by itself accounts for around 20% of total office space under construction in St. Petersburg. The remaining 43% of the active pipeline is split between other districts of the city in the proportion 2-8% of the total pipeline each.
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Prepared for: New construction, sq m JSC ‘LSR Group’
Source: Colliers International
Major office buildings completed in 2014 № Property Address Grade Office area, m2 1 Trinity Place 22, Admirala Lazareva emb. А 27,300 2 Lukoil 8A, Aptekarskaya emb. А 18,620 3 Electro 156, Moskovsky pr. А 15,700 4 Ostrovskogo 2а 2А, Ostrovskogo sq. А 12,600 5 Eightedges 45, Malookhtinsky pr. А 11,900 6 Vilensky 14 14А, Vilensky ln. А 8,440 Passazh/Ital'yanskaya, 7 17, Ital'yanskaya St. А 6,560 17 8 Senator 22, Bol'shaya Pushkarskaya St. А 4,980 9 Eco-Status 140, Ligovsky pr. А 4,040 10 SetlCenter 153А, Leninsky Pr. В 21,130 Victoria Plaza (Phase 11 2, Pobedi Sq. В 20,000 I) 12 Pulkovo Star 28А, Pulkovskoye hw. В 11,160 13 Stachek 59 10А, Kronshtadskaya St. В 9,960 14 H2O 28, Khimikov st. В 9,000 15 Marks (Phase I) 29А, Izmailovsky pr. В 6,820 16 Moskovsky 94 94, Moskovsky pr. В 5,600 17 Politekhnichesky 21, Gzhatskaya st. В 5,550 Total 199,360 Source: Colliers International
Major office buildings planned to be put into operation in 2015
№ Property Address Grade Office area, m2
1 Flandriya Plaza 3, Tashkentskata st. A 29,100 2 Morskaya stolitsa Zol'naya st. / Dal'nevostochny pr. A 25,760 Varshavskaya st., plot 1 (to the north from 3 Varshavskaya st. A 21,600 7А, Varshavskaya st.)
P. 144 COLLIERS INTERNATIONAL
Prepared for: 4 Renaissance Business park 6/1B, Smolyachkova st. A 20,270 JSC ‘LSR Group’ 5 ExpoForum Peterburgskoye Hw. А 17,500 6 Zeppelin 6, Startovaya st. A 12,100 7 Senator (Moskovsky 60) 60/129, Moskovsky pr. A 10,200 8 Senator (Kropotkina st., Phase II) 1, Kropotkina st. A 6,670 9 Mezon Plaza 28/2D, B. Sampsonievsky pr. B 22,600 10 Sofiyskaya 8/1 8/1А, Sofiyskaya st. B 19,850 11 Energo 5, Kievskaya st. B 17,030 12 Ligovsky 266 266М, Ligovsky pr. B 14,500 13 Kondratyevsky 15-3 15/3I, Kondratyevsky pr. B 13,370 Kushelevskaya rd., plot 1 (to the south- 14 Na Kushelevskoy doroge B 11,840 east from 17/4V, Nepokorennykh pr.) 10, Mel'nichnaya st. 15 Me'lnik B 11,050 (Professora Kachalova st.) 16 Megapark (Phase II) 22А, Zastavskaya st. B 10,000 17 Lakhta (Phase II) 4К, Optikov st. B 9,600 Utkin pr., plot 4 (to the east from 65/1А, 18 Formida B 8,170 Zanevsky pr.) 19 Na Tsarskoseliskih kholmakh Peterburgskoye hw. B 6,130 20 Energetikov / Magnitogorskaya Energetikov pr. / Magnitogorskaya st. B 5,700 21 11 Krasnoarmeyskaya 18, 11th Krasnoarmeyskaya st. B 5,500 Total 298,540
Source: Colliers International
Demand In 2014, office space net take-up amounted to around 213,700 m². For comparison, the figure for 2013 was 142,000 m². This increase was due to the gradual relocation of Gazprom subsidiaries to St. Petersburg, which took up approximately 35% in the total office space take-up volume. In addition, Lukoil opened its head office in St. Petersburg, while VTB concentrated some of its offices in one building.
In terms of demand, the highest volume of transactions in the St. Petersburg office market were for premises with an area less than 1,000 m2 (around 80% of the total amount of deals). Besides the oil and gas sector, demand for office premises was created by IT companies and professional services companies. The share of these tenants in the total transaction volume was 14% each. Companies involved in the construction/development and pharmaceutical/biomedical industries also showed a certain level of activity in terms of new leases.
At the beginning of 2015, the volume of vacant space in Grade A & B office buildings reached around 271,000 m² or 11.8% of the total market volume. The vacancy rate for Grade A offices was 17.1%, and 8.5% for Grade B offices.
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Prepared for: Compared to 2013, the vacancy level did not change, as the commissioning volume and JSC ‘LSR Group’ net absorption volume were more or less equal in 2014. However, during the next year we expect an imbalance between a high level of office space completion and a lower absorption level, which will lead to an increase in the share of vacant premises in the market.
Net take-up and vacancy rate dynamics, thousand m2
Source: Colliers International
Rental rates Compared to the figures for 2013, when asking rental rates for Grade A offices in the rouble equivalent increased by 6-8%, rents in 2014 increased just by 1.2%. The main increase was observed in the middle of the year, while in Q4 a decrease in rental rates was noted for some projects. By the end of 2014, the average rate in Grade A office buildings equaled to 1,350 RUB/m²/month, including operating expenses, net of VAT. However, in the present circumstances, landlords are ready to make concessions in the negotiation process and provide discounts in order to keep tenants.
According to the figures for 2014, the average asking rental rate for Grade B offices did not change throughout the year and stayed at the level of 2013 — 985 RUB/m2/month.
Due to rapid rouble depreciation, which intensified at the end of the year, landlords using rental rates denominated in US dollars or euros switched to calculating rates in roubles. Some owners announced rates in euros or US dollars, but use an upper band that is significantly lower than the current exchange rate, which in fact means using rouble rates rather than USD/EUR rates.
Dynamics of asking USD rental rates and exchange rate
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Prepared for: Source: Colliers International JSC ‘LSR Group’ Trends and Prognosis From the perspective of demand, the office market in St. Petersburg remains unbalanced. By the end of 2014, Gazprom companies and their structures comprised around 35% of the total absorption volume. In addition, several office buildings announced for commissioning in 2015 are also reserved for that company (through both lease and ownership).
In terms of tenant demand in 2015, we suppose that the main role in deciding whether to rent or relocate will be played by the final cost of a lease, while the location of a project will have less influence. We expect that the greatest demand in the next year will be for office premises with finished interiors in Grade B+ office centres, as projects combine rates lower than Grade A level and have a quality higher than Grade B.
P. 147 COLLIERS INTERNATIONAL
Prepared for: SAINT-PETERSBURG ELITE RESIDENTIAL MARKET JSC ‘LSR Group’ Key results 2014 Key primary elite residential market indicators in 2014 are represented at the table below
Key primary elite residential market indicators in 2014 № Parameter Value 1 Current primary supply volume 224,000 m2 2 Current primary supply volume (no. of apartments) 1,618 3 Sales volume, Q4 2014, m2 31,600 m2 4 Sales volume, Q4 2014, (no. of apartments) 246 5 Sales volume, 2014, m2 97,200 m2 6 Sales volume, 2014, (no. of apartments) 770 7 Average price for primary elite apartments, Q4 2014 RUB 270-390 thous. Source: Colliers International
Supply By the end of 2014, the primary elite residential market had undergone sales in 27 projects, the total area of the apartments in these schemes is around 473,000 m2. Throughout 2014 the total primary elite stock increased by 165,000 m2 in ten projects, the largest of which are: Krestovskiy de luxe (359 apartments), Privilegia residential complex (334 apartments), Morskoy pr. 29 (80 apartments). At the same time primary sales were finished in several projects: Paradny Kvartal, Ansambl’ na Krestovskom and others.
At the beginning of 2015 approximately 47% of the primary market – around 1,600 apartments totalling 224,000 m2 – are being currently offered for sale by their developers. The greatest volume accounts for the projects of the following developers: Gazprombank- Invest Development Severo-Zapad, Vozrozhdenie Sankt Peterburga, Evrostroy, Leontievsky Mys, and YIT Saint-Petersburg.
Appearance of such large-scale residential complexes as Privilegia and Krestovskiy de luxe in the market led to the increase in share of primary supply on Krestovskiy Island. If at the beginning of 2014 supply volume on Krestovskiy Island was not exceeding 8% of the total supply volume in the city, now share of the primary supply on offer increased up to 42%. At the same time we observe decrease in primary supply in the Central zone (63% one year ago compared to 40% at present). New supply will be also formed by the remaining phases of Smolny Park developed by Vozrozhdenie Sankt Peterburga, that will shift the balance in the opposite direction.
Three-room apartments still constitute the majority of the total supply offered for primary sale, with their share at 42% by the end of the year. The share of two-room apartments amounts to a quarter of supply. The average size of apartments offered for sale is 130 m2.
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Prepared for: Breakdown of elite apartments on offer by developers JSC ‘LSR Group’
Source: Colliers International
Primary market volume dynamics
Source: Colliers International
Demand At the end of the year in the elite real estate market rapid increase in apartment sales was observed, caused by several reasons, among which are: customers’ wish to invest rouble savings in high-quality product, desire to preserve depreciating savings, purchase of apartments before the price change at the beginning of the year, purchase of apartments in projects under construction at the risk of future projects absence.
By the results of 2014 770 apartments (around 97,000 m2 ) were sold in the primary elite market, 246 of which were sold in the last three months. During Q4 2014 active sales were observed in the residential projects developed by Vozrozhdenie Sankt Peterburga, Leontievsky Mys and Evrostroy, as well as in the previous quarter sales in projects of these developers constituted approximately a 70% share of total sales.
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Prepared for: Sales dynamics (primary market) JSC ‘LSR Group’
Source: Colliers International
Prices At the end of 2014 the decrease in prices in elite residential projects was observed due to rush demand of customers. During the first three quarters of 2014 average price increase amounted to 5%, while in Q4 prices increased by 1011% at average. Thus, annual price growth amounted to 12% in deluxe segment and around 20% in premium segment. Average price for elite apartments increased from RUB290,000 to RUB340,000 per m2.
By the results of sales in OctoberDecember 2014 demand for apartments costing more than RUB30 million has increased. During the previous periods their share was 3035%, while by the results of the year it increased up to 50%.
Sales price dynamics
Source: Colliers International
Trends and forecasts At the beginning of 2015 we expect high sales volume of apartments in projects with high completion level compared to the same period of previous years. In the future, as customers willing to buy apartments at 100% payment will leave the market, sales volume will gradually decrease.
Reduction of credit provision availability will lead to decrease in number of announced projects in elite segment, as a result further gradual increase in prices in primary
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Prepared for: residential market is possible. Furthermore, rouble devaluation together with high import JSC ‘LSR Group’ component in elite segment projects will also influence price for apartments.
Positive sales dynamics is also observed in projects offering apartment hotel units. It should be mentioned that apartment hotel projects with low completion level have no credibility among potential customers, while high completion level together with low prices (in comparison with apartments of the same level) is of interest.
P. 151 COLLIERS INTERNATIONAL
Prepared for: SAINT-PETERSBURG BUSINESS CLASS RESIDENTIAL MARKET JSC ‘LSR Group’ Main results of 2014 Key indicators of business class new build residential real estate market by the results of 2014 are represented in the table below.
Key indicators of business class new build residential real estate market by the results of 2014
№ Name Value 1 Total new build supply 560,000 sq m 2 Apartment on show amount 7,200 3 Total sales, 2014, apartment area 365,000 sq m 4 Total sales, 2014, apartment amount 5,100 5 Average price/sq m, Q4 2014 147 thousand RUB Source: Colliers International, Knight Frank St. Petersburg Research, 2015
Supply In 2014 27 business class residential complexes with a total living area of 519.4 thousand sq m (7.33 thousand apartments) entered the market. A significant proportion (about 80%) of delivered projects relates to the comfort segment, which is different from the business segment by apartment floor plans and number of quality parameters. Among the Class B largest residential complexes, entered the market in 2014, it is possible to mark out a new phase of Tsarskaya Stolitsa residential complex, Samotsvety residential complex, Stockholm and The Residence. Besides, a significant amount of area entered the market in already commissioned Europa City residential complex in the third phase of construction.
Thanks to the increase of new areas marked during the year the market supply of business class residential real estate has increased by 11% compared to the same period of 2013, amounting to about 7.2 thousand apartments (560 thousand sq m). Class B completed housing supply was extended by more than two dozen commissioned projects (without considering phases) with the total living area of 528.3 thousand sq m. This index has broken the commissioning records in the last few years. It is worth noting that 21% of the commissioned area falls on projects that have been marketed in the period of the previous crisis of 2007-2009. In turn, 41% of the commissioned area was complexes that entered the market in the wake of new construction volume growth in 2012-2013.
P. 152 COLLIERS INTERNATIONAL
Prepared for: Class B projects commissioned in 2014 with an area more than 20 thousand sq m. JSC ‘LSR Group’ Living area, Apartment Name Developer thousand sq m amount, items Tsarskaya Stolitsa, build. LenSpetsSMU 79.4 1275 2Б, 2В, 3Б, 3В Imperial L1 66.3 845 Platinum Kvartira.ru Platinum 51.2 601 Galant LenSpetsSMU 45.3 641 Europa City, phases I and II Vozrozhdeniye Sankt-Peterburga 45 510 National Mineral Resources University Vasilievsky Kvartal 40 614 (University of Mines) Tapiola, 2 phase Lemminkainen 25.8 326 Suomi YIT 23.6 360 Sourse: Colliers International, Knight Frank St. Petersburg Research, 2015
Demand Sales volume in the business segment in the pre-crisis period of 2003-2008 was 300-400 sq m per year or 80-120 sq per quarter. After the crisis the demand for properties of this class began to decrease, in the period of 2009- 2010 it was 200-250 sq m per year, in 2011-2012 the volume of demand has decreased to the level of 100-150 sq m per year. The decrease happened due to both a decline in the supply volume and the worsening of residential property quality of this class and blurring of the boundaries with a comfort segment. In 2013-2014 the demand volume in this class increased and amounted to about 200 thousand sq m. This increase happened thanks to the commissioning of a number of quality projects in high demand.
Against the background of changes in the macroeconomic situation 2014 was marked out for Class B real estate as a year of maximum indexes by the majority of key indicators. Indicators of demand exceeded the level of 2006 by 14%: 364.8 thousand sq m of housing were sold for the year, which is also 65% higher than the indicator in previous 2013. Drop in the exchange rate of the national currency has become a key motive of growing purchase of housing for investment purposes. Especially noticeable was the increase in the share of transactions where the apartments were purchased as a long- term investment – for children or parents.
Commercial terms During 2014 Class B residential real estate developers regularly made adjustments in the cost of apartments in their properties. The rate growth of an average price per sq m in rubles happened in the beginning of the year and continued until Q3 2014, after that the prices have slightly stabilized. However, the fall of the ruble at the end of the year forced the majority of developers to make significant adjustments in pricing so an annual growth of prices for Class B apartments amounted 15% comparing with the same period in 2013.
By results of Q4 2014 regarding the beginning of the year the price growth amounted +5% in the business segment.
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Prepared for: Average price dynamics in the Class B housing new build market, RUB/sq.m JSC ‘LSR Group’
Source: Colliers International
Average price of sq m in the business segment housing new build market by results of Q4 2014 amounted 147 thousand RUB per sq m.
Trends and forecast Sales volume which brought the developers of residential market high income allows to expect that the planned for 2015 commissioning of several projects with a total living area of about 553 thousand sq m will take place. Among these it is worth noting Kolomyagi ECO at 36/12 Malaya Desiatinnaya St; Riverside at 3 Ushakovskaya Emb; Sobraniye at 12 Bolshaya Posadskaya St, and the following phases of the residential complexes Europe City at 10 Medikov Ave and Tapiola at 108 Obvodny Canal Emb. In the beginning of 2015 a number of developers will likely have continuous pricing adjustments related to the growing cost of building and finishing materials. First of all it will deal with projects in the final stages of construction. However, in the case of the coming decrease in demand volume in the future different kinds of promoting marketing activities, special offers, and discounts are likely to appear, which will consequently lead to a decrease in the average price.
MASS MARKET RESIDENTIAL MARKET OVERVIEW
Main results of 2014 Key indicators of mass market (comfort and economy class) new build residential real estate market by the results of 2014 are represented in the table below.
Key indicators of mass market new build residential real estate market by the results of 2014 № Name Value 1 New build supply total volume, apartment area 5,800 thousand sq m 2 New build supply total volume, apartment amount 160,000 3 Total sales, 2014, apartment area 4,799 thousand sq m 4 Total sales, 2014, apartment amount 103,500 5 Range of average price per sq m, Q4 2014, econom and comfort class 82 - 106 thousand RUB/sq m Source: Colliers International, Peterburgskaya Nedvizhimost Consulting Center, Center of research and analytics Bulleten Nedvizhimosti GC P. 154 COLLIERS INTERNATIONAL
Prepared for: Supply JSC ‘LSR Group’ According to BN since the beginning of the year until mid-December 188 projects were delivered to the market in which 4.9 million sq m of housing (10.6 thousand apartments) were on sale. LSR Group is still ahead by the number of new projects with 18 start-up properties, in second place is CDS (11 start-ups), the third – Setl City (10 start-ups).
Considering the stages of construction of new housing projects and the presence of buildings the supply structure is the following: 29% are commissioned and partly commissioned projects, 8.4% - are projects with declared terms in H1 2014. In 2015 over 36.4% of buildings under construction are declared to be commissioned. 18.9% falls on 2016, 7.3% of the number of on-sale properties falls on 2017-2020.
According to Colliers International, the volume of commissioning at the end of 2014 was about 3.5 million sq m, about 3 million sq m was commissioned in the city limits. Maximum amount of commissioning in the recent years was recorded in Vyborgsky, Pushkinsky, Primosky and Krasnoselsky districts.
The trend of the recent years is a high rate of development of territories in Vsevolozhsky district and the adjacent to the city limits zones: Kudrovo, Yanino, Murino. During 2014 about 0.5 million sq m of mass market housing was commissioned in these zones.
In the structure of the current supply of new housing market in December 2014, as at the end of 2013 studios, one- and two-bedroom apartments dominate, which occupies 75.3% of the market, three-bedroom apartments – an average of 21.1%. Large apartments (four bedrooms and more) amount 3.7% of the total apartment volume in buildings under construction. In the supply with segmentation by type of houses the brick-monolithic buildings still dominate, it is 65.4 % of the total market.
The supply structure by districts by the end of 2014 the leading position is occupied by Primorsky district of St. Petersburg – 18.2% of the new housing total market. Further, in the market of apartments in buildings under construction a large share is occupied by Vyborgsky and Moskovsky districts, the supply is distributed by 11.8% for each of them. Minimum number of projects under construction is observed in the Frunzensky district – 1.8% of the total new housing market.
Demand In 2014 the agitation of purchaser interest in real estate happened thanks to the currency fluctuations and the weakening domestic currency. In February-April sales increased by 1.5-2 times compared to the same months in 2013. From May to August, purchasing activity has decreased by 20-30%. Then the ruble became cheaper once again, and purchasers again paid their attention to the real estate market without any alternative tools of finance maintenance. As a result sales of the largest developers blocked the spring rates in October.
The last in the passing year wave of excitement was caused by the December decision of the Central Bank on the growth of the key rate to 17%, as a result the demand increased by other 15-30%.
According to the experts of the Peterburgskaya Nedvizhimost Consulting Center in 2014 4.8 million sq m were sold in the primary market exceeding the index of 2013 by 26%. P. 155 COLLIERS INTERNATIONAL
Prepared for: Commercial terms JSC ‘LSR Group’ By type of a building in the market of housing under construction a change of price supply in the brick-monolithic buildings regarding to December 2013 was 8.7%. Panel buildings rose in price by 21.6%. The most expensive apartments are offered in buildings of brick- monolithic construction, in December 2014 the average supply price by market in the whole amounted to 98.7 thousand RUB per sq m. The cost per sq m in panel buildings under construction at the end of the year is 88.4 thousand RUB.
By results of Q4 2014 regarding to the beginning of the year the price growth amounted +6% in the mass market segment.
Average price dynamics in the mass market new housing market, RUB/sq m
Source: Colliers International
The average price per sq m in the new build market of mass-market housing at the end of Q4 2014 amounted to 82 thousand RUB/sq m for economy class and 106 thousand RUB/sq m for comfort class. Trends and forecast Forecasts of developers are pessimistic and cautious. In the case of a general decline in demand the interest of purchasers will inevitably shift to the supply located within the city limits. Therefore, most of the regional real estate developers have to try to compete only by reducing prices, and this resource has its limitations. Experts predict a decrease in sales rates and sales volume. Commissioning of new projects may also decrease.
Most developers play waiting game and watch the changes in demand. Collapse of the mortgage credit will lead to interesting proposals on installments. However, most developers will offer short-term schemes within 12 months. In fact, no more than 15% of the players can afford to wait for the full payment of apartments for more than 3 years.
Experts predict that devaluation of the national currency and high import component in construction together with high inflation will lead to a gradual increase in the cost of sq m of housing. In the worst course of events the increase in the average market value of the apartments may amount 15%.
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Prepared for: MOSCOW OFFICE MARKET JSC ‘LSR Group’ Key market figures in 2014
Index Value Total stock, million m2 15,8 Grade А 3,4 Grade В 12,4 Completions, million m2 1,4 Take-up, million m2 1,1 Net absorption, thousand m2 551 Vacancy rate, % 14,2 Grade A 26,1 Grade B 10,9 Weighted average rental rates in CBD, 700 $/m2/year Grade A 840 Grade B 540 Source: Colliers International Supply During 2014 developers showed a record high activity – growth rates exceeded all previous indicators since 2008. The volume of completions grew 60% comparing to 2013 and amounted to 1.4 million m2.
Total supply of high quality facilities in the Moscow office market almost reached 16 million m2 mark.
Despite the appearance of significant number of large-sized offices and mixed-use centers in 2014, the average area of completions accounted for 27 thousand m2 due to numerous small reconstructed facilities.
Significant share of new completions – 23% (340 thousand m2) accounts for office premises along the Third Ring Road (TTR) in the West direction. Next comes Moscow International Business Center Moscow City district with 205 thousand m2, or 15% share of total completed volume.
It also stands to mention several large technology and business parks in the South-West region near Moscow Ring Road (MKAD) totaling more than 230 thousand m2. This fact proves the trend of office development decentralization and emergence of high-tech modern business districts outside the city.
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Prepared for: Total stock and completions, million m2 JSC ‘LSR Group’
Source: Colliers International
Largest buildings completed in 2014
Building Grade Developer Office Area, m2 Stolitsa development / President Plaza А 114 700 StroyGazConsulting ОКО А Capital Group 110 000 Comcity, Phase А PPF Real Estate 107 550 Alpha Lotos А MR Group 88 400 Eurasia Tower А Tekhinvest 86 800 Vereyskaya Plaza III В- Plaza Development 76 000 Port Plaza B+ Plaza Development 62 700 Vodny A MR Group 52 340 Orbita Tekhnopark II B+ Amtel Properties 39 400 ArcusIII A AB Development 34 300 Kutuzovsky 32, bldg G B+ StroyGazConsulting 33 700 Aero City A Vysota 32 640
Source: Colliers International
Demand Take-up dynamics showed minor improvements in the last quarter of 2014, mostly due to the largest completed transaction in office market –sale to final consumer of almost 80 thousand m2 in MIBC Moscow City.
The volume of take up in 2014 is estimated at 1.1 million m2 – a quarter lower than 2013 level. Sales accounted for 20% of total demand, whereas the share of purchased offices did not exceed 15% previous year. However no evidence of increase in the number of purchase and sale transactions was found. This lets us consider that the sales share growth is due to a single large transaction.
The structure of office demand saw certain changes in 2014: leadership went to companies operating in Energy and Professional Services segments. The latter showed rapid growth and boosted their share from 7% up to 17% within a year. A significant amount of deals also accounted for IT and Telecom (14%) as well as Manufacturing companies (14%).
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Prepared for: The largest take-up volume is still concentrated in Central Business District (CBD), where JSC ‘LSR Group’ more than 30% of all annual deals amount was closed. Next offices in highest demand were located in MIBC Moscow City (14%), Leningradskiy (10%) and Tulskiy (10%) business districts. The rest 35% of demand were evenly distributed across Moscow business districts.
Net take up accounted for 550 thousand m2 at the year end, whereas the 2013 indicator was 25% higher – 750 thousand m2. This proves the trend of completions growth rates outrunning the office area demand.
Take-up distribution by economic sectors, %
Source: Colliers International
Office market partially repeats 2008 scenario and shifts from bid market to buyer’s market: tenants' positions strengthen raising opportunities to claim better commercial terms with orientation on rouble nominated rental rates or find better ‘value for money’ offers, that somehow stimulate demand. Meanwhile, take up indicator in 2015 will mostly be explained by tenants' shifts within Moscow business centers as well as office buying transactions for own occupation purposes. This is due to sale price reduction on certain offers in Moscow office market.
Largest Examples of lease Transactions in 2014
Building Grade Office Area, m2 Client Comcity, Phase A 17 370 Systematica Alpha Alcon, фаза I A 13 000 PepsiCo Yuzhny Port B+ 7 000 SK Soglasie Comcity, Phase A 6 370 Oracle Alpha Wall Street A 4 900 Teva Source: Colliers International
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Prepared for: Vacancy rates JSC ‘LSR Group’ Record completions growth rates together with deals volume decrease resulted in vacancy rate escalation. This especially concerns Grade A segment with 26% vacant areas as at the end of 2014 - 9 percentage points higher than the previous year.
Completions growth rate in Grade B was slower and average vacancy rate therefore grew 3.5 percentage points accounting for 10.9%.
It is worth mentioning the occupancy rates of certain new facilities which were already in high demand during construction period and therefore had minimum vacancy rate by the time of completion: Comcity phase Alpha, Savelovsky City, Vodny, Interior among others.
The largest volume of vacant areas – approximately 453 thousand m2 – is concentrated to the West of the capital near TTR. The vacancy rate here is 27.5%.
The largest share of vacant office premises is accumulated in MIBC Moscow City (43%) and business centers located in the South-West direction along MKAD (31%). Moreover, 70% of vacant areas in stated districts falls to Grade A segment.
Significant share of Grade B+ offices for lease and sale is found outside CBD in the West, North-West and South directions and accounts for 21%, 13% and 12% correspondingly.
Vacancy rates, %
Source: Colliers International
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Prepared for: Top submarkets by vacant areas, thousand m2 JSC ‘LSR Group’
Source: Colliers International
Rental rates Economic destabilization of 2014 lead to significant decrease in demand, for office premises among other things. Together with growing vacancy rates this could not but result in rental rates reduction.
Besides, in the context of rouble exchange rate volatility many landlords, who used to nominate rental rates in dollars, started fixing parities of currencies or completely switching to contracts in terms of rouble. However, although dollar rental rates scare off a lot of tenants nowadays, given trend is not widespread.
Asking rental rates in dollar terms fell within a year by circa 20% for Grade A offices and 25-30% for Grade B+. Weighted average rental rates in rouble terms for Grade A premises account for RUB 30,000/m2/year with fixed exchange rate at 38-40 RUB for $1. This exceeds 2013 year end indicator by 15%.
Dynamics of asking rental rates, Grade A, $/RUB m2/year
Source: Colliers International
Grade B+ was influenced by exchange rate volatility to a lesser degree as long as rental rates are mostly nominated in rouble terms here and account for RUB 9,000- 20,000/m2/year. Rental rates’ dollar equivalents are $645/m2/year for Grade A and $355/m2/year for Grade B offices.
P. 161 COLLIERS INTERNATIONAL
Prepared for: Dynamics of asking rental rates, Grade B, $/RUB m2/year JSC ‘LSR Group’
Source: Colliers International
Distribution of asking rental rates shows annual decrease practically at any remoteness from the center, excluding MKAD where average rental rates already are at minimum level. Thus weighted average rental rate for Grade A varies in the range $290- 400/m2/year. In business centers of lower price segment rental rates in rouble terms lie between RUB 11,000-14,000/m2/year for Grade B+ and RUB 7,300-9,300/m2/year for Grade B-.
Sale prices More than 600 thousand m2 of office areas of all kinds are offered for sale nowadays, of which 45% is presented in Grade A segment.
Selling prices were relatively stable till the end of third quarter. However, due to the deteriorating economic situation serious shifts in office market has been seen since September 2014 – a growing number of owners switch to rouble nominated prices or fix exchange rate at the delivery of purchase and sale contracts. Exception applies to high quality premises with prime location which have an opportunity to keep process in dollar terms.
The average asking price for Grade A premises declined by at least 5% during the year and stayed at the $6,000-7,000/m2 level. Prices for those business centers located further from CBD lie in the range $4,000-6,500/m2. Meanwhile, average selling prices in business districts as MIBC Moscow City and certain CBD areas reach $8,000-9,100/m2.
Average prices for Moscow Grade B+ office facilities declined by ca 15-20% from $5,800/m2 to $4,900/m2, while Grade B- prices stayed unchanged and accounted for $4,000/m2.
There were also examples of high quality Grade A and B offices offered for $3,000/m2 in 2014. In certain cases prices fell to $2,500/m2.
P. 162 COLLIERS INTERNATIONAL
Prepared for: Top 10 submarkets by asking rental rates, $/m2/year JSC ‘LSR Group’
Source: Colliers International
Dynamics of asking rental rates by the distance from the center of Moscow, $/m2/year
Source: Colliers International
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Prepared for: JSC ‘LSR Group’ Prognosis
Dynamics of vacancy rate and correlation of take-up and completions
Source: Colliers International
Nonetheless we can expect gradual shift of demand towards sales segment. Due to continuous and significant adjustments of selling prices, one can expect growing tendency towards purchase of ownership of office facilities in 2015, both for personal use and investment purposes.
Completions growth might be 40-50% lower next year than 2014 indicators. Despite developers’ announcements of more than one million m2 of office areas to complete, only 700 thousand m2 might be finished on time. Major share of GLA will be located in the South-West, in MIBC Moscow City as well as West end of the capital with 26%, 25% and 16% share of all planned completions correspondingly.
Largest Office Space in Moscow-City
Number of Type of building Area, m2 buildings Completed 10 777 170 Grade А 7 660 370 Grade В+ 3 116 800 Under Construction 5 545 260 Grade А 4 444 260 Grade В+ 1 101 000 Total 15 1 322 430 Completed 10 777 170
Source: Colliers International
Possible completion schedule prolongation of a large part of facilities under construction together with moderate demand for Grade B offices with high probability will keep average vacancy rates down, which in 2015 will account for 14,6-14,8%.
P. 164 COLLIERS INTERNATIONAL
Prepared for: It may happen that against the economic recession and keen competition asking rental JSC ‘LSR Group’ rates will still continue falling in dollar terms. To a lesser extent this will concern centralized premium business centers with less elastic demand. Other developers will aim to provide flexible commercial terms in attempts to retain current tenants and stimulate demand for their premises among potential clients. The intensity of rouble rates adjustments will be less significant due to raising inflation in the country.
The trend towards shift to contracts nominated in roubles and exchange rate fixing the exchange rate at a certain level and for a specified period at certain level will continue in 2015, that in short term drawing rental rates closer to real market demand.
Largest Major business centers expected for delivery by the end of 2015 in Moscow
№ Building Grade Developer Area, m2 CiTer Invest B.V., 1 IQ-Quarter А 191 000 Hals Development AEON 2 Federation, Tower East В+ 101 000 Development ZAO Sadovoye 3 Oruzheiny Per., 41 А 90 000 Kolco 4 Neo Geo, I & II Phases В+ Stone Hedge 89 200 5 Evolution А Snegiri 79 000 6 Suvorov Plaza, Tower B A StroyGazConsulting 68 000 7 Bolshevik А O1 Properties 58 400 8 Neopolis А A-Store Estates 48 850 9 K2 Business Park А Storm Properties 48 350 M Development 10 Atlantic А 47 200 and Construction Source: Colliers International
P. 165 COLLIERS INTERNATIONAL
Prepared for: Vacancy and asking rental rates by business districts JSC ‘LSR Group’
*- Mainly for shell & core premises
** - Mainly for fitted-out premises
Please note, the rental rates presented in the table are asking rates before negotiations discount.
Source: Colliers International
P. 166 COLLIERS INTERNATIONAL
Prepared for: THE RESIDENTIAL PROPERTY MARKET OF MOSCOW, ‘NEW’ JSC ‘LSR Group’ MOSCOW AND MOSCOW REGION Principal quantity supplied in the market of new residential buildings is represented by business-class facilities (53.1 %). About 25 % falls on new comfort-class buildings, 14.5 % - on elite facilities. The lowest quantity supplied (8 %) is for new economy-class buildings.
MOSCOW ELITE RESIDENTIAL PROPERTY MARKET According to preliminary estimates, buyers of big-budget residential property in Moscow (new premium- and business-class buildings) acquired about 4,100 apartments and suites in 2014 totaling about USD 2.8 bln.
As compared to 2013, dollar volume of these market segments decreased by 5.9 %, despite the fact that the number of transactions increased by 34.8 %.
The Number of Transactions, 2009-2014
Year The number of transactions prime business totally 2009 315 1,067 1,382 2010 425 1,260 1,685 2011 452 1,615 2,067 2012 420 1,797 2,217 2013 518 2,532 3,050 2014 502 3,611 4,113 Source: IntermarkSavills
About 88 % of realized demand fell within business-class apartments and suites in the big-budget segment. However, the number of transactions recorded in the current year exceeded last year's figures by a factor of 1.4. In contrast, the number of premium-class apartments sold in 2014 slightly decreased (-3.1 % compared to 2013).
Most transactions with expensive residential property were observed in Q4 2014 - about one third of the total annual demand. Another peak of activity occurred in ‘Olympic’ February, during which about 420 big-budget apartments and suites were sold.
It is stated that the annual market volume in monetary terms increases steadily. In 2014, the overall picture was sort of distorted due to USD appreciation by over 70 % against RUB (per annum). Nevertheless, even under the circumstances, the amount of dollars spent by buyers on big-budget residential property almost corresponds to a relatively successful 2013. The market volume in ruble terms has increased by over 10 % this year.
In total, buyers spent over USD 13 bln to purchase new expensive buildings in 2009- 2014. Over 60 % of money turnover was provided by business-class projects; the share of premium projects amounted to 40 %, respectively.
P. 167 COLLIERS INTERNATIONAL
Prepared for: Total Amount of Transactions, 2009-2014, USD 'M JSC ‘LSR Group’ Year The total amount of transactions, million dollars prime business totally 2009 865 783 1,648 2010 1,090 1,036 2,126 2011 1,135 950 2,085 2012 1,158 1,178 2,336 2013 1,185 1,800 2,985 2014 1,100 1,708 2,808 Source: IntermarkSavills
In 2014, the average cost of an apartment in the big-budget segment of the new-building market of Moscow amounted to USD 680,000. As compared to last year, the figure fell off by 30 % due to substantial increase in percentage of business-class apartments and suites in the pattern of demand, as well as to significant rise in the dollar, while the considerable part of supply was denominated in rubles.
Supply At the end of 2014, it was obvious that there would be a wide range of elite residential property for buyers in 2015. Against reduction in unsold areas in Khamovniki, developers intensively built up other territories in the Central Administrative District (CAD). So, two residential complexes (RCs) in Zamoskvorechye and three RCs in Yakimanka became available for sale in 2014. The second stage of Sadovye Kvartaly was launched in winter of 2014. Nine new buildings (with nearly 1,100 apartments and suites) entered the market in 2014 in total.
At the end of 2014, about 1,750 apartments, or shy of 252,000 sq. m, were offered for sale in the primary market of elite residential property in Moscow. There were 44 RCs located in various parts of the city center in the market.
Demand For twelve months of 2014, over 500 transactions were concluded in the primary elite property market of Moscow. The average number of transactions is 42 per month, with the peak of the market activity in February (67 purchases). Record-breaking demand was due to USD fluctuations that ensured profitable acquisition of apartments for rubles, on the one part. On the other part, the second stage of Sadovye Kvartaly Project entered the market with a wide product range. In monetary terms, developers recorded the sales revenue of over USD 1.0 bln, just as last year.
Khamovniki became the most popular sector for buyers again - almost half the transactions took place here. In 2014, the average cost of an apartment acquired in Khamovniki amounted to USD 2.3 mln, with the average area of 155 sq. m. Zamoskvorechye and Donskoy Sector shared the second place with 13 % of transactions each in the total quantity demanded.
Sadovye Kvartaly (2nd stage), Barkli Residence and the elite quarter named Literator were three bestsellers among premium-class projects; they took almost half the total demand in 2014. P. 168 COLLIERS INTERNATIONAL
Prepared for: Prices JSC ‘LSR Group’ About 60 % of offers in the elite residential property market are denominated in rubles, others - in dollars. In dollar terms, the average price amounted to USD 15,700 / sq. m upon translation of the total supply into dollars at the end of 2014. This is at 19 % below the price in December 2013. As for comparison in the national currency, the picture is quite opposite; ruble prices increased by 42 % for the year nearing completion.
Supply Price Behaviour in the Primary Market of Premium-Class Residential Property, %, 2014
150
140
130
120
110
100
90
80
70
RUB/sq/m/
$/sq.m.
Source: IntermarkSavills
If we consider only projects with sales in dollar terms (translated at the exchange rate of the Central Bank), the average price is USD 23,900 / sq. m. For the projects where developers estimate the apartments in rubles, the average price is RUB 508,000 / sq. m (or USD 8,900 / sq. m, in dollar terms).
P. 169 COLLIERS INTERNATIONAL
Prepared for: Money Turnover Movement in the Market of New Elite Buildings of Moscow, USD 'M, JSC ‘LSR Group’ 2009-2014
1400 1158 1185 1200 1090 1135 1100
1000 865 800
600
400
200
0 2009 2010 2011 2012 2013 2014
Source: IntermarkSavills
Forecast Preliminary results of recessionary Q4 2014 show the market trends in the next 12 months:
Average price expressed in dollars will continue to fall. Dollar prices for elite residential property have already decreased by 19 % for October to December 2014. It is likely that the average price level, by the early summer, will be comparable with the minimum five years ago (mid-2009) and amount to USD 12,500-13,000 / sq. m.
No significant expansion of supply is expected in 2015. In the circumstances, only small projects have chances of entering the market, as investors are able to finance the construction at their own expense or with minimum lending. It is likely that the number of new elite complexes will be limited to 5-6. Small club houses will prevail, as they are valuable and marketable at all times. The supply will increase by 400-500 apartments and suites.
In 2015, effective demand will remain at 2013-2014 level, despite the crisis, and amount to 450-500 transactions p.a. In addition to buyers, which purchase apartments for living, the demand will be supported by investors, which will use annual bonuses at the end of 2014 and dollar savings following final stabilization of the exchange rate.
In 2015, apartments with the budget of USD 1-2 mln will be in maximum demand; 2/3 of transactions will fall on them. As prices fall, demand will expand for cheaper facilities (up to USD 1 mln); they will occupy about 15-20 % of the market. Transactions to the amount of over USD 3 mln will not exceed 15 % of demand, over USD 5 mln - just 3-5 %.
P. 170 COLLIERS INTERNATIONAL
Prepared for: MOSCOW BUSINESS-CLASS RESIDENTIAL PPOPERTY MARKET JSC ‘LSR Group’ At the end of 2014, it was almost likely that there would be a wide range of business- class residential property for buyers in 2015 as well. Projects entering the market are really varied. For example, four new complexes were put into operation in the North Administrative District (NAD) that allowed the latter to become a leader by new developments in 2014. New RCs include both small buildings and large-scale apartment complexes. Six new projects became available for sale in the South Administrative District (SAD) and CAD, three in each. In 2014, the supply increased by 14 new business-class residential complexes in total. More large-scale projects became available for sale in the north-west and in the heart of the city, therefore, the choices of buyers increased by a factor of over 3 for the former and by a factor of 2 for the latter, per year.
Geography of Supply in the Market of New Business-Class Buildings of Moscow
Source: IntermarkSavills
On average, the quantity supplied in the market of new business-class buildings in Moscow increased by 43 % p.a.
Annual Changes in the Pattern of Supply by Administrative Districts of Moscow for 2013- 2014
District Changes, % Market average data, % North-West 220% Central 91% North 43% North-East 35% 43% South 17% East 10% South-West -29% West -46% Source: IntermarkSavills
At the end of 2014, over 10,100 apartments and suits, or over 800,000 sq. m, were offered for sale. There were 54 RCs in the market. However, at most 3 districts still form
P. 171 COLLIERS INTERNATIONAL
Prepared for: the principal part of apartments and suits exposed in the market, namely, the North-West JSC ‘LSR Group’ Administrative District (NWAD), NAD, CAD; in total, they offered over 2/3 of all lots. It should be noted that the statistics do not include residential and apartment complexes with secret sales, so the real quantity supplied in the market and, therefore, project competition are just higher.
Demand For twelve months of 2014, 3,785 transactions were concluded in the primary market of business-class residential property in Moscow.
The average number of transactions is 315 per month, with the peak of the market activity at the year end. The term ‘boom’ is most appropriate to define the demand in December. Buyers have acquired over 550 apartments and suites just for a month, i.e. almost twice the monthly average for the year.
Most interest fell within quite large projects with apartments and suits (over 1,000 of projected lots). Many purchasers took advantage of special purchase conditions, i.e. long-term installments from partner banks, seasonal discounts, promotions, that added confidence in decision-making.
It turns out that annualized number of transactions exceeded the same of a relatively quiet 2013 by 50 % and the figure for Q4 increased by 64 % YOY. Developers recorded 1,305 purchases (for comparison, the number of primary transactions amounted to 1,260 in 2010 as a whole).
In monetary terms, 2014 is behind last year by 4 %. However, since the crisis of 2008- 2009, over 12,000 of apartments and suites have been acquired in the market of new business-class buildings in Moscow, and the amount of the transactions reached just about USD 7 bln.
Developers and their agents recorded over 1,000 of primary transactions every year and earned over USD 1 bln on their accounts since 2012. The contribution of recessionary 2014 amounted to 31 % of all transactions for the period, and 25 % of all invested dollars, in monetary terms.
This was mostly caused by some challenges in the currency market and quite a wide range of projects in sectors of high quality. However, it is important to mention changes in the pattern of supply itself in retrospect.
In most cases, developers drew lessons of the last crisis, so many projects with maximum demand can be considered to be best prepared (in terms of planning concepts, specifications, etc.) so as to meet the buyers' needs to the greatest possible extent.
This is also confirmed by minimum average budget of a transaction over the last 6 years, i.e. about USD 457,000 (or below RUB 18 mln at annual average USD/RUB rate).
P. 172 COLLIERS INTERNATIONAL
Prepared for: Purchases in the Market of New Business-Class Buildings in Moscow, 2009-2014 JSC ‘LSR Group’ The Monetary market The cumulative Year Primary deals cumulative volume, $ total total 2009 1,067 1,067 605 605 2010 160 2,327 774 1,379 2011 1,615 3,942 950 2,329 2012 1,797 5,739 1,178 3,507 2013 2,532 8,271 1,800 5,307 2014 3,785 12,056 1,731 7,038 Source: IntermarkSavills
Prices At the end of 2014, weighted average dollar price of supply in the market of new business-class buildings in Moscow, in fact, became irrelevant.
During the year, average supply price in dollars fell off to USD 5,100 / sq. m; devaluation amounted to 34 % p.a. and 30 % per quarter.
It is the lowest value over the last 6 years (previous minimum of USD 5,420 / sq. m was observed in December 2009). The remarkable fact is that the maximum price of USD 7,750 / sq. m was also observed that year in July followed by progressive reduction in the dollar price.
On the contrary, ruble prices showed a predictable increase of over 15 %.
Early in the year, average ruble price for all business-class projects amounted to RUB 251,000 / sq. m, and RUB 290,000 / sq. m at the year end.
Vast majority of developers revised their price lists and established ruble prices at a fixed rate (USD/RUB: 39-45, in different periods).
By 2014 end, over 90 % of offers in the market of new business-class buildings were denominated in rubles.
Ruble prices changed both due to growing rate (at the year end, USD appreciated by over 70 % against RUB) and predictable activity on the part of buyers, which considered purchase of apartments as a method of preserving spare money. In December, several projects suspended sales due to revision of price lists.
As a result, major system developers steadily met annual targets to reach a certain price level.
Increase in ruble prices is most likely to continue in the next six months - they will increase by at least 40 % of all apartments and suites exposed in the market (i.e. residential property of over 321,000 sq. m).
For developers, the premium totally depends on buying activity. At present, annual business plans of a number of key projects specify growth of at least 10-15 %.
In 2014, historical ceiling (July 2014) and floor (December 2014) prices were observed over the last 6 years. P. 173 COLLIERS INTERNATIONAL
Prepared for: Forecasts JSC ‘LSR Group’ During 2015, price movements of the first six months will continue to be technical in nature (appreciation/depreciation of the fixed rate).
Real increase in ruble prices will be observed in projects of major developers; its value depends on buying activity. If the number of transactions remains sufficient (at least 200- 300 transactions per month), most marketable projects will show growth of 10-13 % at the year end.
Increase in ruble prices in the overall market will be comparable to inflationary expectations. Competition for buyers will continue. Even in case of a minimum number of new projects entering the market, the quantity supplied will remain quite significant and exceed the same in recessionary December 2009 by a factor of near 4 (over 10,100 of apartments and suites in December 2014 against 2,900 in December 2009). Projects with life cycle of at least 5-7 years are under execution. Thus, the current level of market competition will force developers to be more flexible in pricing and payment terms for buyers in the coming year.
P. 174 COLLIERS INTERNATIONAL
Prepared for: MOSCOW ECONOMY-CLASS RESIDENTIAL PPOPERTY MARKET JSC ‘LSR Group’ Supply The segment of new economy-class buildings expanded due to commencement of sales of several bearing-wall houses in the first stage of a new major project named River Park in the south of the city. Besides, several new buildings in Nekrasovka-park Microdistrict came into the market. New quantity supplied in the segment is about 55,000 sq. m.
Demand Location and price are crucial factors for buyers choosing an apartment.
Crucial Factors in Choosing an Appartment
Source: Knightfrank
For the period from the beginning of 2014, demand for real estate remained stable, while Q3 and Q4 showed an abnormal upsurge in buying activity.
Prices At the end of Q3 2014, average supply prices in the new-building market were as follows:
Economy class - RUB 150,741 / sq. m (USD 3,895 / sq. m).
Just as in prior periods, changes in the pattern of supply related to release of new projects had a significant impact on price behaviour in the market. So, the economy-class segment showed most significant changes for the quarter; the average price decreased by 15.4 % as compared to the previous period. During the quarter, the supply in the segment expanded due to appearance of new buildings in RC Nekrasovka-park at the initial construction stage that contributed to decrease in average supply price in the segment.
P. 175 COLLIERS INTERNATIONAL
Prepared for: ‘NEW’ MOSCOW RESIDENTIAL PROPERTY MARKET JSC ‘LSR Group’ Supply During 2014, the primary market of residential property in ‘New’ Moscow was regularly updated with new offers that ensured increase in quantity supplied by a factor of near 1.5, i.e. by 47 % by the number of buildings for sale. At the end of December 2014, apartments in 333 new buildings were offered for sale (+20 % against September 2014).
For the last year, offers in 200 facilities entered the market of new buildings in annexed territories. Most of them are new buildings in large residential complexes, which sales started before.
Behaviour of Quantity Supplied in the New-Building Market of ‘New’ Moscow, the Number of Buildings
Источник: Blackwood
In Q4 2013, the quantity supplied in south-western territories increased by 92 addresses (28 % of the total number of new buildings in the supply). A significant share fell within economy-class facilities, i.e. 85 % of the total number of new offers.
Pattern of Supply of New Buildings in ‘New’ Moscow, by Classes (the Number of Buildings), December 2014
Source: Blackwood
P. 176 COLLIERS INTERNATIONAL
Prepared for: Principal quantity supplied represents buildings in residential projects, which entered the JSC ‘LSR Group’ market earlier. Most of them are marketable in the territory of the first belt away from MKAD. They are offers in residential complexes such as Buninsky near Stolbovo Village, Moscow A101 in Kommunarka Settlement, Pervy Moskovsky in the City of Moskovsky, Peredelkino Blizhnee near Rasskazovka Village, Tatyanin Park in Govorovo Village, Prima-park and Ovrazhny in the City of Scherbinka, etc.
Pattern of Supply of New Buildings in ‘New’ Moscow, by Distance from Moscow Ring Road (MKAD) (the Number of Buildings), December 2014
Source: Blackwood
Prices Last year was defined by significant changes in behaviour of prices for new buildings in ‘New’ Moscow. The price for apartments in the primary market of residential property increased by 21 % p.a., in ruble terms. Due to material depreciation of the national currency in dollars, a drop of 29 % p.a. was observed.
At the end of December 2014, the price level for new buildings in south-western territories amounted to RUB 109,400 / sq. m (+7 % against September 2014). Dollar prices fell off by 27 % for the quarter; average supply price amounted to USD 1,962 / sq. m.
The price for economy-class apartments increased by 27 % p.a., in rubles. At the end of December 2014, average supply price amounted to RUB 109,990 / sq. m. Prices for new comfort-class buildings increased slower (+19 % p.a.) and reached RUB 108,590 / sq. m. Business class showed 5% growth against December 2013; at the end of December 2014, average supply price amounted to RUB 129,810 / sq. m.
P. 177 COLLIERS INTERNATIONAL
Prepared for: Weighted-Average Supply Prices for New Buildings in ‘New’ Moscow, by Classes, RUB JSC ‘LSR Group’ per sq. m, December 2014
Source: Blackwood
Average supply price in economy class remained constant (+0.3% change for the quarter) and amounted to RUB 100,740 / sq. m. Prices for comfort-class apartments increased by 2 % (RUB 102,630 / sq. m), for business-class apartments - by 6 %, to RUB 130,520 / sq. m.
Most expensive offers presented in new buildings located near MKAD; the average price level exceeds RUB 100,000 / sq. m. At the end of September 2014, average supply price for the projects implemented in the territories within 5 km from MKAD amounted to RUB 109,980 / sq. m, in the territorial belt of 6-15 km from MKAD - RUB 101,045 / sq. m.
Weighted-Average Supply Prices for New Buildings in ‘New’ Moscow, by Distance from MKAD, RUB per sq. m, December 2014.
Source: Blackwood
P. 178 COLLIERS INTERNATIONAL
Prepared for: Behaviour of Weighted-Average Supply Prices for New Buildings in ‘New’ Moscow JSC ‘LSR Group’
Source: Blackwood
P. 179 COLLIERS INTERNATIONAL
Prepared for: MOSCOW REGION RESIDENTIAL PPOPERTY MARKET JSC ‘LSR Group’ Supply The number of new buildings for sale in the primary market of Moscow Region remained nearly constant in December 2014 against December 2013. The year end was traditionally marked by quite impressive volume of residential property put into operation. For example, the following facilities were commissioned: 2 buildings in A 101; RC Triumph in the City of Klimovsk; RC Samotsvety, bldg. 1, the City of Lyubertsy; Pavshinskaya poyma in the City of Krasnogorsk commissioned 5 buildings at once, and RC EkoVidnoe commissioned 3 buildings as well. It is just a small part of facilities put into operation. However, new facilities entered the market despite the events of recent months and more serious impending consequences of the crisis. We would like to pay attention to the new facilities such as RC Skazka, Istra; RC Lyubertsy-2015, the City of Lyubertsy; RC Vysoky Bereg, the City of Lytkarino; RC Opalikha OZ, the City of Krasnogorsk, and a number of new facilities and buildings in already existing projects.
In December 2014, the number of apartments for sale in the primary market was about 40,710. The number of apartments in new buildings depends not only on the number of facilities, but also, to a great extent, on a project scale (maximum number of apartments is in comprehensive development facilities). As compared to 2013, the quantity supplied increased by a factor of near 2. Given almost constant number of addresses, the quantity supplied expands mostly by new buildings within houses under construction.
Depending on the distance, the following changes took place in December 2014 YOY:
The quantity supplied in satellite cities increased by 10 %,
Other cities showed decrease in the quantity supplied; the figure decreased by 1 % in cities located at 16-30 km distance and in the most peripheral cities of Moscow Region,
The quantity supplied also decreased by 3 % in the cities located at 6-15 km distance, by 5 % - at 31-60 km distance.
Depending on the direction, December 2014 YOY was marked by decrease in the quantity supplied by 3.5 % in the east, by 2.7 % in the west, by 1.8 % in the south-east. Other directions showed increase by 0.3 % in the north, by 1% in the south-west, by 1.5 % in the north-east, by 2.1 % in the north-west, and by 3.1 % in the south.
P. 180 COLLIERS INTERNATIONAL
Prepared for: Pattern of Supply of New Buildings and Appartments Depending on Direction JSC ‘LSR Group’
Source: Peresvet Grupp
Depending on the type of building, the highest number of apartments sold in December 2014 was observed in solid houses - 37.4 %. This is due to predominance of the type of development in the Region as a whole. Share of apartments in houses made of brick amounted to 35.1 %, in bearing-wall houses - 27.5 %. Quite significant changes took place YOY, namely, increase in bearing-wall houses to 3.4 %, material decrease in solid houses to 22.8 %, increase in houses made of brick by 19.4 %. Depending on the type of apartments, the pattern of supply remains quite stable over the past years. In December 2014, the highest number of apartments sold fell on one-room apartments and two-room apartments - 44.6 % and 33.4 %, respectively. Share of three-room apartments amounted to 18.9 % in December, while share of multiroom apartments were the lowest one as usual, 3.1 %. It should be noted that the following changes occurred in the pattern of supply in December 2014 YOY: increase in one-room apartments by 4.1 %, increase in two-room apartments by 2.2 %, but share of three-room and multiroom apartments decreased by 2.9 % and 2.4 %, respectively.
Demand In December 2014 YOY, the demand increased by 72 %. Such a significant upsurge in demand resulted from lower levels of the national currency. Many buyers tried to purchase real estate property due to fear of further increase in prices for real estate property. In December 2014, principal demand fell on one-room apartments, 48 %; two- room apartments were in high demand as well, 35 %. Three-room and multiroom apartments are less popular as usual; the number of requests amounted to 16 % and 1 %, respectively (such a low demand for multiroom apartments, among others, was due to their absence in most projects).
The following changes occurred for the year. The number of requests increased only for one-room apartments, by 9.7 %. Other types of apartments showed deterioration in demand: for two-room apartments - by 8.3 %, for three-room apartments - by 1 %, for multiroom apartments - by 1 %. Increased demand for one-room apartments resulted from smaller budget of purchase and higher marketability as compared to multiroom apartments.
P. 181 COLLIERS INTERNATIONAL
Prepared for: Prices JSC ‘LSR Group’ In December 2014, the average price level for sq. m amounted to USD 1,452 / sq. m, or RUB 82,763 / sq. m (USD/RUB: 57). On average, the price per sq. m increased by 12.6 % YOY.
If we consider prices for apartments by distance from Moscow, there are significant changes observed YOY: the price increased by 27.6 % in most peripheral cities of Moscow Region and by 16 % in cities located at 31-60 km distance. The prices in cities and satellite cities of near Moscow Region increased by 7.8 % and 7.7 %, respectively.
If we consider price behaviour by directions, all of them showed increase YOY. Most significant increase was in the north - 17.8 %, then in the south-west and north-west - 15.8 % and 15.9 %, respectively, in the west and south-east - 14.3 % each. The north- east became more expensive by 14 %, the south - by 8.6 %, the east - by 6.5 %.
Depending on the type of building, the prices for bearing-wall houses increased by 5.2 % in December 2014 YOY, for houses made of brick - by 10.7 %; most significant increase was observed in solid houses, 11.7 %.
Depending on the type of apartments, the price for one-room and two-room apartments increased by 11.9 % and 11.5 %, respectively, in December 2014 YOY. Prices for three- room apartments increased by 12.7 %; most significant increase was observed in multiroom apartments, 17.4 %.
In December 2014, the average cost of apartments amounted to USD 85,708, or RUB 4,885,361 (USD/RUB: 57). The cost was 7.7% higher in December 2014 YOY. The cost increased less than the price per sq. m did that resulted in increased number of one-room apartments in the quantity supplied.
P. 182 COLLIERS INTERNATIONAL
Prepared for: 1 JSC ‘LSR Group’ EKATERINBURG RESIDENTIAL PPOPERTY MARKET
2014 was a very controversial year for the market. On the one hand, general economic background steadily deteriorated with a threat of rapid diminution in demand for residential property. On the other hand, the very negative macroeconomic factors have become a key incentive for boom that allowed keeping the sales volumes both in the primary and secondary markets at a record high.
The first wave of panic buying was noted in the spring. Primary reasons were political situation and general economic background in the country. In terms of expectations of ruble depreciation and overall uncertainty, real estate is traditionally considered to be a protective option for preservation of savings. Thus, buyers, which planned to purchase apartments in the coming months, chose to speed up the procedure and make a transaction as soon as possible. The same is for panic withdrawal of funds from banks at the end of Q3.
The second wave of boom came in December. It was triggered by ruble devaluation and increase in the key rate to 17 % by the Central Bank. This time, buyers seeking for preservation of accumulated funds were accompanied by those who had approvals for mortgages at earlier rates from banks. As a result, the sales volumes in the secondary market exceeded prior year's level by +10 % in 2014. More significant growth of sales was recorded in the primary market.
For sure, such an active buying behaviour during the year affected the dynamics and volumes of construction. In the circumstances of increased demand, developers not only tried to complete ongoing projects fast enough, but also intensively developed new sites. As a result, despite significant parameters of commissioning (according to preliminary estimates of the Administration of Ekaterinburg, residential property of over 1.0 mln sq. m in area were built in 2014, including private housing construction), volumes of construction remained high. Now, residential property of about 2.7 mln sq. m in area are under construction in apartment buildings of the city.
1 Using analytic data of the Urals Real Estate Chamber. P. 183 COLLIERS INTERNATIONAL
Prepared for: Quantity of Residential Property under Construction in Ekaterinburg and Satellite Cities, JSC ‘LSR Group’ ‘000 sq. m
Source: «Ural chamber of real estate»
A separate area, which develops rapidly and already distracts buyers from the market of suites, is the segment of apartments. While the segment is under formation, its importance for the market grows rapidly. The volume of apartments under construction currently amount to 236,000 sq. m (+34 % against December 2013). They can be divided into two equal groups by quality. The first group includes facilities focused on mass demand, developed for buyers with a limited budget, and able to attract families seeking for residential property in the old fund and on the outskirts of the city. The second group includes apartments competing with business-class and elite residential property. They are located in the central part of the city with a shortage of new offers.
In addition, high volumes of construction remain in satellite cities, which are increasingly involved in the market decentralization and intensively compete with residential complexes of the third and fourth belts. Stable demand for such projects on the part of residents of Ekaterinburg became developed before 2008. However, buyers had no choice by quality or territory until recently. In recent years, the situation has changed; the number of projects increased significantly. Today, apartment buildings with 307,000 sq. m in area are under construction in satellite cities and settlements adjacent to Ekaterinburg. The largest volume falls on Berezovsky (116,000 sq. m) and Verkhnyaya Pyshma (90,000 sq. m). Besides, Sredneuralsk has a considerable potential for development; near 54,000 sq. m are under construction in the city.
P. 184 COLLIERS INTERNATIONAL
Prepared for: Supply Price Behaviour in the Residential Property Market of Ekaterinburg, RUB / sq. m. JSC ‘LSR Group’
Source: «Ural chamber of real estate»
Thus, the total volume of projects under construction in the residential property market, including suburbs and apartments, is 3.2 mln sq. m. About 1 mln sq. m of the figure in the final stage (interior finish). Most of the projects were scheduled for commissioning in 2015, but plans of many developers in rapidly changing business environment may be revised. However, such a number of projects under construction ensures a great quantity supplied in the market of residential property under construction in the coming year.
High demand for residential property in the first half of 2014 and in December 2014 allowed most market participants to sell significant volumes of apartments with gradual increase in prices for marketable facilities. For the twelve months, rise in the cost per sq. m of new buildings amounted to +7.8 %. Factors affected the demand were short-term; in Q1 2015 the market will face a noticeable drop in activity. At the beginning of January 2015, average supply price in the primary market amounted to RUB 65,370 / sq. m according to the Database of the Urals Real Estate Chamber.
In general, the situation shows only nominal, but not real price development. In 2013 and 2014, the price behaviour was below the rate of inflation. Growth in the residential property market of Ekaterinburg resulted mostly from development of mortgage lending. Given changes in the key rate, the majority of banks will significantly reduce the number of loans issued. Some deceleration is therefore assumed in the market in 2015 followed by some decrease in prices in the residential property market. Alternative scenario is also possible, with acceleration of inflation and continuing poor nominal increase in prices. In this case, inflation will significantly exceed the rate of growth of prices for apartments.
Changes in the average price per sq. m of apartments in the primary market of residential property are shown in the table below.
P. 185 COLLIERS INTERNATIONAL
Prepared for: Changes in Average Prices for Apartments, per sq. m JSC ‘LSR Group’ The price at the The price at beginning of Jan. the beginning Changes, % 2014 of Jan. 2015 The city average 60,376 65,369 +8.3 One bedroom flat 65,167 68,170 +4.6 Two bedroom flat 59,292 64,630 +9.0 Three bedroom flat 56,548 62,691 +10.9 1st line 70,112 74,641 +6.5 2nd line 60,722 65,740 +8.3 3rd line 56,739 56,287 -0.8 Source: «Ural chamber of real estate»
P. 186 COLLIERS INTERNATIONAL