St Peterburg Times

STAFF WRITER
The growth of commercial real estate, fair property valuation and the legal and financial questions associated with entering the city's real estate market were all discussed at the Real Estate Market in St. Petersburg: Status and Trends conference, organized by the city chapter of the American Chamber of Commerce on Thursday.
With presentations from city government officials, real estate experts and consulting and legal advisers, the conference provided a comprehensive analysis of the city real estate market, which is developing dynamically.
Maxim Sokolov, the chairman of the city Investments and Strategic projects committee, welcomed the attendees, who were mainly the representatives of international firms operating in the city, including American Express and Ernst & Young. The city government hopes to become a more accessible and user-friendly partner to investors, he said.
St. Petersburg's residential real estate has a 20-percent growth potential until it plateaus, said Alexander Vinogradov from AVK Research group. Citing AVK's research and analysis, Vinogradov said that $1,400 per square meter was a fair price for city residential real estate.
With the average September price for residential property in the city nearing $1,100, there is still room for considerable growth. Vinogradov said that AVK's estimation of growth in Moscow had already been reached and that the going rate in the capital was $1,900 per square meter.
St. Petersburg developers need to conform to international standards in property classification and provide more transparent information on the deals they make, said Helena Tabala, director of Knight Frank</b>, an international real estate agency that entered the St. Petersburg market in July. She cited the lack of information as the major obstacle to comparative analysis of the market, saying that it left clients to rely solely on the opinions of experts.
However, she said, there is much to be positive about in the Russian market, and in St. Petersburg specifically, where there are lower thresholds to investment and all the opportunities an emerging market has to offer.
Anatoly Seroka from property consultants Colliers International provided an overview of retail and business center development in St. Petersburg. "For now, interestingly enough, the retail center market is dominated not by Moscow or Western developers, but by companies originating from St. Petersburg, such as Lenta and O'Kei, that continue to be successful in the city," Seroka said. The new Perinniye Riadi complex next to Gostiny Dvor mall on Nevsky prospekt and the shopping center Pik on Sennaya square, once opened, Seroka said, will become showcases of how city retail centers can perform in densely occupied and competitive locations.