Moscow Investment Digest

August 2017

Dear Colleagues,

The Moscow Department for Economic Policy and Development along with the Moscow City Investment Agency presents the next issue of the digest of the main investment events held in Moscow.

Investments in fixed assets increased by 20% in Moscow

Moscow has retained the growth of investments in fixed assets and can fairly be considered the country’s most important centre for raising of investments. Their volume amounted to 658.2 billion RUB for the first half of the year. According to Mosgorstat, fixed capital investments by a full range of the capital city’s entities has increased by 20.1% in the first six months of 2017 compared to the same period last year.

Sergei Sobyanin has noted the surge in economic activity in the capital city

For two years now, more and more goods are being exported, which are produced in the capital city. Muscovites’ profits are rising so profit and income tax inflows to the city budget are on the rise too. The results of the economic activity of the capital city were reported by Mayor of Moscow Sergei Sobyanin at a meeting with Chairman of the Government of Russia Dmitry Medvedev. “The economy of the megalopolis has adapted to the current conditions – both international and domestic ones and both economic and macroeconomic ones. A number of indicators show that the volume of investments is not decreasing, but increasing. This was a trend in previous years, but we see a surge in investments in the first quarter of this year”, Sergei Sobyanin said, adding that for the second year a positive trend regarding the registration of enterprises remains.

Dmitry Medvedev stressed that the trend of growth in investments in fixed assets, the volume of trade and exports should be nourished. “It is very good that Moscow is experiencing recovery growth, because this city is the largest megalopolis and the country’s driver of development. Numerous economic processes that originate in the capital city then spread throughout the state as part of the all-Russian economy”, said the Prime Minister of Russia.

Technopark Vodny Stadium appears in Moscow

The complex of buildings in the north of the city received the status of a technopark called the Vodny Stadium, and production sites of the Binnopharm Pharmaceutical Company received the status of an industrial complex in Zelenograd.

This will allow participants in the real sector support program to receive tax benefits and preferences for other charges. Natalya Sergunina, Deputy Mayor of Moscow for Economic Policy and Property and Land Relations, stated that high-tech companies need to be supported and a comfortable environment for the development of an innovative economy should be created.

«Creating conditions for the development of modern and promising productions is one of the priority tasks, for they have a potential for rapid growth and actively implement new solutions and technologies», she said.

There are already 31 technoparks in the capital city. Each of them has its own focus, from the development of computer technology to nanotechnology.

Government subsidies of the city of Moscow will allow enterprises to purchase equipment worth around 1.5 billion roubles

The Department of Science, Industrial Policy and Entrepreneurship of Moscow held a meeting of the Finance Commission , whereby subsidies were allocated to reimburse part of the cost of purchasing equipment for processing industries located within the capital city and leasing payments.

The total amount of subsidies will exceed 191 million RUB and will allow Moscow enterprises to purchase equipment worth 1.427 billion RUB.

Residents of Technolopolis Moscow – OOO NTsK and AO T8 and industrial complexes NPOLEMZ and ZAO Mikoyanovskiy Meat-Packing Plant will receive the state support of more than 40 million RUB for the acquisition of equipment.

12 companies, including OOO Dymovskoye Sausage Production, AO Cosmetic Association Svoboda and ZAO Kolomensky BKK will have their leasing payments partially refunded. The amount of support for these purposes will exceed 151 million RUB.

More than 1,250 people become private entrepreneurs in Moscow weekly

Moscow confidently retains the title of the capital of Russian private entrepreneurship. In seven months of this year, more than 35,000 new private entrepreneurs have been registered in the city, which is almost a quarter more than in January–July 2016.

According to the Federal Tax Service of Russia, 274,000 private entrepreneurs were registered in the city on the first day of August which is 7.4% of all entrepreneurs operating in Russia.

Moscow economists gain recognition for their methodology

The World Statistical Congress, the main event in the professional life of the world statistical community, was held in Marrakesh, Morocco. A product developed by specialists of the Moscow Department for Economic Policy and Development and the State Budgetary Organization Analytical Centre under the Moscow Government was introduced on the event.

Presented at a special session of the World Statistical Congress, domestic developments in calculating wages are of great importance for the statistical practice of both the Russian Federation and majority other countries.

In the first quarter of this year, the methodology developed by specialists of the Moscow Department for Economic Policy and Development and the Analytical Centre was presented to the Federal State Statistics Service (Rosstat).

A design plan for the northern bypass for Kutuzovsky Avenue is approved

Mayor of Moscow Sergei Sobyanin signed two resolutions of the government of the capital city, approving a design plan for the site of the northern bypass for Kutuzovsky Avenue from Minskaya Street to Moscow Ring Road. This is the first road concession in Moscow: construction will be carried out using private investments.

The future 11 km long toll highway will have three 3.5 m wide lanes in each direction. The route will pass along the Smolensk direction of the Moscow railway. The plan foresees the construction of the interchange of the northern counterpart of Kutuzovsky Prospekt at the intersection with the Moscow Ring Road, the arrangement of non-surface pedestrian crossings, halting points and toll booths.

The project of the northern bypass for Kutuzovsky Avenue is planned to be developed by the end of the year and then a tender for construction will be announced. The work is scheduled to be completed in 2019.

Moscow auction: Moscow authorities set a complex of buildings on Moskvoretskaya Embankment for an auction

A complex of buildings on Moskvoretskaya Embankment (9/5 Kitaygorodsky Proyezd) has been set for an auction. It includes 33 buildings, nine of which are cultural heritage sites, five more represent valuable city-forming facilities. Among them is the Orphanage designed by Carl Blanc in the second half of the XVIII century. At various times, the building housed a shelter, a hospital, a hotel, the Nikolaev Institute for Officers’ Orphans, the Institute of Paediatrics, the Military Academy, and the Military Academy of Strategic Missile Troops.

The investor is required to preserve the historical appearance of all the facilities. The initial price of the lot is 8.6 billion RUB.

Investors have a great opportunity to implement a large-scale project near the Kremlin next to the Zaryadye park on 11 hectares. According to experts, it is expedient to create service apartments in the complex of buildings on Moskvoretskaya Embankment. They are practically missing in the Moscow market, while this segment is well-developed in Europe and is well-known to foreigners.

Moscow authorities intend to develop industrial zones in the south-west of the capital city

The former production sites of ZIL are to accommodate both residential buildings and technoparks. The first such facility can be opened by the manufacturer of automotive components Itelma that provides spare parts for AvtoVAZ and GAZ. The company, which already has the status of a technopark, turned out to be the only bidder for the purchase of a land plot worth 1.13 billion RUB.

According to the tender documentation, the buyer is required to invest at least 4 billion RUB in the creation of the technopark in addition to payment for the plot. The technopark’s facilities are to be ready by 2022 at the latest.

The total area of the ZIL industrial zone reaches 392 hectares, which is almost 40% of the territory of the Danilovsky district. About 62 hectares are allocated for residential development – 1 million sq.m. will be built by the LSR Group. In addition to housing, ZIL plans to build sports facilities, recreational areas and a technopark.

Industrial and scientific activities will be developed in the Ochakovo industrial zone at the west of Moscow. In the northern and southern parts of the industrial zone, there are city utility facilities, industrial and public buildings, large administrative complexes. There will be a new transport and engineering infrastructure here and parks will be created. The Ochakovo electrical substation will be reconstructed, an administrative and warehouse complex will be built.

All information about the Ochakovo industrial zone is presented in the section “Renovation of industrial zones” on the portal of the Construction Complex.

Thanks to the reorganization of the industrial zones, Moscow will create new jobs next to housing on the periphery of the city. This will reduce the traffic flow in the morning on weekdays in the centre of the capital city, and in the evening – on the way out of the centre.

Moscow invites investors to create a high-tech congress and exhibition centre at VDNH

A large-scale project to modernize the VDNH EXPO zone, which is expected to raise private investments of more than 22 billion RUB, will help enhance Moscow’s role in the global congress and exhibition market.

The total area of the renewed congress and exhibition centre of Moscow will be more than 320 thousand sq.m. and will include a concert and congress complex seating 4 thousand people and exhibition pavilions with a total exposition area of 63 th sq. m.

Preserving the architectural appearance of the exhibition is a prerequisite for the investor seeking to implement the project whose architectural concept was developed by a consortium of six leading architectural bureaus: SPEECH, Asadov Architectural bureau, Ginzburg Architects, ub.design, Arch4 and Wall.

The application campaign of the open competition will last until December 21, 2017.

Private clinic upon the program called “Doctor Nearby” to be opened in the north of Moscow

Premises for a medical clinic to be opened upon the program called «Doctor Nearby» in the north of Moscow were sold at an auction of the Moscow City Department for Competition Policy. The annual rent was 2.6 million RUB.

«The terms of the lease agreement require that the investor repairs the premises and installs medical equipment within eight months. With the launch of the private clinic, a preferential rate will start to be applied. The time-period of the agreement is 20 years», – said Head of the Department for Competition Policy of Moscow Gennady Degtev.

Leonid Kostroma, Director of the Moscow City Investment Agency, spoke about the mechanism of the city’s cooperation with investors.

«The Moscow City Investment Agency accompanies the implementation of new public-private partnership projects, including this programs, helping future investors to assess the economic attractiveness of the facilities. In total, 109 facilities were transferred to entrepreneurs during the program called «1 RUB per 1 sq. m.». Of these, 59 have already switched to the preferential rental rate», – Leonid Kostroma said.

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