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EBRD invests in St Petersburg office refurbishment
A new modern office facility for the City of St. Petersburg (the "City") has come one step nearer fruition with a US$ 4.1 million equity investment by the European Bank for Reconstruction and Development (EBRD) to refurbish and restore Nevsky Prospekt 25, an architecturally and historically significant 18th century building in the city centre. It marks the Bank's first investment in the property sector, as well as the Bank's first investment in St Petersburg.
The agreement was signed by a group of investors which includes the City, the Central Design Bureau for Marine Engineering (a Russian state enterprise), A/O Aerobaltservice (a Russian joint stock company), Nevsky Investment L.P. (an affiliate of Chicago-based property company Golub & Company) and the EBRD.
The Mayor of St Petersburg, Anatoly Sobchak, commented "We hope that this project will provide a model for utilising public-private partnerships to attract investment to the City, particularly to finance the development of the City's infrastructure."
Ron Freeman, First Vice-President of the EBRD, added: "With one investment we serve two important purposes - we preserve a prominent, historically important building in St Petersburg, while at the same time we provide the City with urgently-needed modern office space."
The project will mobilise almost US $20 million of non-City funds to preserve Nevsky Prospekt 25, by refurbishing it to provide almost 10,000 gross square metres of office and retail space. When completed in 1995, Nevsky 25 will represent the first substantial office development to be delivered in the City centre. By alleviating the City's shortage of office space the project will enable international companies to more easily set up businesses in the City, thereby encouraging the development of Russia's competitive sector.
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