PLAC DEFILAD DESIGN CHOSEN?

The saga over the future shape of Plac Defilad in Warsaw continues. On January 23, Warsaw’s city hall accepted an architectural design for the neglected location and should everything go smoothly – which hasn’t been the case for the last two decades – the plan has a chance of becoming official.

The design assumes a line-up of high-rise buildings along Emilii Plater Street, opposite the mixed-use office and retail complex Złote Tarasy, the InterContinental Hotel and the Warsaw Financial Center. A public space will remain on the other side of the square, in front of the Palace of Culture, though limited by the planned Museum of Modern Art and the new building of Kupieckie Domy Towarowe (KDT), which will replace the still-standing metal box that has been the disgrace of the area for years.

An important change is that the new plan doesn’t allow for a high-rise building on the corner of Świętokrzyska and Marszałkowska Streets. It would also eat into the green area of Park Świętokrzyski, an area that city officials would rather see intact. Local press reported on January 23 that the city is tussling with architect Christian Kerez over his fee for his work on the Museum of Modern Art. According to media reports, city hall is only willing to shell out PLN 27m (€7.45m), while Kerez is reportedly sticking to a figure exceeding PLN 30m. It wouldn’t be Plac Defilad, however, without serious trouble appearing unexpectedly.

GAZELEY MAKING CEE PLUNGE

Leading UK-based industrial developer Gazeley is interested in establishing a presence in Central and Eastern Europe. “We’re looking to open business in CEE,” confirms Jonathan Fenton-Jones, Gazeley’s global procurement and sustainability director. According to unofficial information, Gazeley’s current UK managing director Nick Redwood will take over as head of CEE. 

“We think the time is now to enter the region, because the market and customers there are more mature now and better suit our business model of a developer that sells everything it develops and doesn’t sit on its investments,” says Fenton-Jones. “It takes a more mature market to sell the sustainable projects that we develop, as well.” Gazeley’s business has been relying on the delivery of advanced sustainable warehousing and logistics property. Such projects are, according to Fenton-Jones, virtually the only future of industrial development.

It’s not Gazeley’s first attempt to venture into CEE. In 2003, the company tried to secure land for an industrial development in the town of Sochaczew, about 60 km west of Warsaw. Eventually, it was Parkridge – now ProLogis – that won the hearts of Sochaczew authorities.

GOVERNMENT QUARTER PLANS FIZZLE

Budapest’s long-planned government quarter came crashing down last month Prime Minister Ferenc Gyurcsány halted the project over deadline and financial concerns. The cluster of city and state governmental institutions was to have been developed on 30 ha near the burgeoning Váci út office corridor in Budapest’s District VI. Estimates had pegged the total costs of the project at HUF 400bn (€1.6bn). According to media reports, government officials are claiming a fully-prepared concept will be ready by the end of the year.

“[Project planners] were always insisting on a completion time of 2009,” says one source who preferred to remain anonymous. “When they started, it sounded realistic, but as time went on and the tenders were postponed, it became practically impossible to keep that deadline.” She says the timing of the project has never been seen as realistic from a property expert’s point of view, based as it is on purely political considerations – namely, the four-year term of the current government, which expires in 2010. She adds that clearing the building site and moving the train facilities made everything a much bigger undertaking than was expected. “It was the lack of preparation. What they claim is these legal issues, but [the quarter] is something so big that it should have been clarified before,” she says. “I think if there had been real intent, that’s something that would have been solved.”

Another strike against the project was the involvement of too many parties: the state, the municipality of District VI and Budapest City Hall, not to mention developers who weren’t strong enough to push through their bids for the site but were successful in blocking the bids of others. One developer involved with the project, speaking off record, thinks eventually there will be some development on the site, as the government needs to recoup the money it’s spent, but at the present time there’s no way to tell what or when that will happen. “The fundamental problem from the outset was the government had no idea how time-consuming and complex it would be,” he says. “Even with their power to accelerate it, they’ve now realized they can’t complete [the project] in time to benefit from it.”

DIAMANT IN THE ROUGH

The Diamant building is one of those projects that’s been kicking around, it seems, since the real estate market began in Prague more than a decade ago. Remarkably, the city has said almost from the beginning that it wouldn’t mind if an investor tore it down. Every couple of years, hopeful project plans have surfaced, declaring that the project was finally coming to life. Suddenly, the building simply disappeared last month as its owner, the Austrian company Duha Property led by Dr. Wolfgang Müller  apparently decided to tear the building down. Rumors that the company had proceeded without a demolition permit proved to be false, which always seemed likely, as the contractor, as well as the financing bank (said to be Volksbank) would hardly have agreed to such an approach. Müller also confirmed to CiJ that he had all the necessary permits to move forward. Some sources indicate the city is demanding he build underground parking for the building, which is being designed as a hotel with retail and restaurants on the first two levels. But Müller says that building parking is neither feasible for the location nor necessary for his hotel. Prague 1’s construction office made no mention of a garage being an issue. Alexandr Koráb, spokesman for Prague 1’s says, however, that the investor appears to have made new plans for the building that would diverge significantly from the original project. “He can build, but he has to stick to the original design,” says Koráb.

BUDAPEST GASWORKS BACK ON THE MARKET

Hopes last year that the Hungarian Museum of Technology would take up residence in the Óbuda Gasworks are fading. The former gas production plant, dating from 1912 and sitting idle for more than 20 years, is a listed historical site and as such, presents an interesting redevelopment challenge. Not only are developers balking at the costs involved in preserving and integrating the protected buildings into any future project, they’re even uncomfortable with the added cost of dealing with any Roman leftovers that turn up in excavations. Imre Gróf, CEO of Budapest Urban Development, says the protected site should be revitalized and put to good use as a cultural site or something similar, but “the public money is missing, as usual.” Gróf says an attempt to extract some EU funding for the project fell through, and that the city is also unable to offer its support.

With the failure of the museum plan, Gróf now says he’s open to pretty much any project that will put the site to good use. He stresses that the site should be mixed-use – “a housing estate is not welcome, and any logistic or investor activity is prohibited, of course.” Aside from those restrictions, the field is wide open. Gróf is hopeful the planned Dream Island casino and leisure resort from Plaza Centers, beginning to transform the southern tip of nearby Óbuda Island, will act as a catalyst for development of his site. ”It can be an advantage,” says Gróf. “It’s another development in our neighborhood and that can help the development of our project.”