16 december 2009

Prime Minister Vladimir Putin met with Alexander Braverman, the general director of the Federal Fund for Housing Construction Assistance

Vladimir Putin and Alexander Braverman discussed the problems and plans of the Federal Fund for Housing Construction Assistance.

Transcript of the beginning of the meeting:

Vladimir Putin: The fund was established a little more than a year ago and began working in earnest this year. What are the results, problems and plans for the future?

Alexander Braverman: Mr Putin, after being in operation for a little more than a year, by agreements with the regions the fund has received information on about 1,380 plots of land with an aggregate area of more than 1.5 million hectares.

The government commission has decided to start construction on 100 plots this year. Twenty-five plots have been transferred to the regions, and the fund will auction off another 25 plots before the end of this year.

All in all, this will make it possible to build about six million square metres of housing this year. In line with the strategy adopted by the fund's council, next year this figure will increase to 12 million, and in 2012 about 30% of all economy housing built in Russia will be on the fund's land.

A distinctive feature of the land managed by the fund is the comprehensive support it renders, which include access to the infrastructure, all the required paperwork completed and a financial mechanism for real estate development.

The fund is working in close contact with regional leaders and the natural monopolies. It has agreements with the Federal Network Company, MRSK Holding, Gazprom, Mezhregiongaz and the Energy Ministry. This is our basic design. p.

This will allow us to auction off plots on favourable terms for developers at controlled prices that are indicative of the segment of the population that buys affordable housing.

The fund is also granting land to factories that produce industrial building materials. Again, we are focusing on affordable housing as well as energy-saving and environmentally-friendly technology.

Needless to say, we will establish favourable conditions for potential buyers of this land to develop it.

We have announced a competition for new architectural designs for affordable housing, primarily low-rise buildings. The results will be presented on December 28. After the winners are announced, we plan to submit the best projects to Rosekspertiza to get a permit for the repeated use of these projects, which will help us to bring down costs.

Thus, we have created whole cycle - a plot of land, industrial facilities for manufacturing building materials that meet certain requirements and new architectural designs. We hope that this will allow us to change our approach to the construction of affordable housing.

Vladimir Putin: We have talked about the need for your fund to coordinate its efforts with the Housing and Utilities Fund, which primarily focuses on repairing dilapidated housing and moving people out of unsafe buildings. Have you done anything to this end?

Alexander Braverman: Mr Putin, in line with your instructions we have started working with this fund on high-rise, joint construction projects. We will work with them in allocating land for high-rise buildings and managing the land you mentioned before, that is, the land that is not being developed after the buildings on it were demolished by the municipal authorities.

We are working out the details of this arrangement. We have begun working closely with VEB (Vnesheconombank) to get loans for building infrastructure on land plots, because this is the only development institute that can grant long-term loans for infrastructure and the purchase of industrial construction materials with due account of the requirements I mentioned before.

Vladimir Putin: Once people move out of decrepit and unsafe housing they should not come back. This housing should be...

Alexander Braverman: ...demolished.

Vladimir Putin: ...demolished. But in many regions this housing is located in attractive areas where land is not inexpensive. If your fund puts this land into circulation, we would be able to build housing there, reduce prices and minimize costs.

Alexander Braverman: Mr Putin, we have started to develop a mechanism for this and I will report to you in several months on our progress.

Vladimir Putin: Good.