Alexey Golub: «Ukrainian real estate market has reached its bottom, below which doesn't fall»
Alexey Golub: «Ukrainian real estate market has reached its bottom, below which doesn't fall»
2009 was a test for all, without exception, real estate players. Some companies restructured, reviewed the personnel policy and strategy development, reduce costs. Other companies have chosen a different way of development, using the crisis difficult time with the use and starting the implementation of several projects of residential and commercial real estate.
On the problems of development business in the Ukrainian real estate market, as well as his personal vision of general trends of the market in an interview said Alexei Golub, CEO of development company City State.
When was founded City State Company? What projects the company has already implemented? What projects are in the plans?
Company City State was established in January 2007, a full-fledged development activity started implementing since 2008, in the middle of 2008 was started construction of the first 12-cell housing complex in Schastlivoe village in Borispol district. At the moment, the house was built and is ready for commissioning.
In parallel with the construction of the housing the company has implemented a number of infrastructure projects for improvement of the settlement, rehabilitation and laying of new roads, which created the necessary platform for the implementation of subsequent projects of residential and commercial real estate.
The main objective of the City State - realization of the project of integrated development area near Kiev for the construction of «turnkey» well-equipped European-style village with infrastructure in close proximity.
Now in the Company's portfolio is more than ten commercial projects with a total square of about one million square meters, among which there are objects of commercial, office, logistics, exhibition, hotel, recreational segments. Also in the plans of the company - construction of about 350 thousand sq.m. housing.
Tell us about the beginning of your work in the company. What difficulties were encountered?
The position of Director I took in 2009 - this time the real estate market experts are often called the culmination of the crisis in the construction industry. At that time, the chaos which reigned in the construction industry, firmly entrenched in people's minds. Panic, confusion, lack of clear priorities and perspectives - are the main problems with the decision that had to fight in the first place. It is always easier to create a new business than to remake old. The company at that time was completely «raw» - no ordered structure, no regulated budgeting, exacerbated by staffing issues. Updating the company was carried out ab ovo - from the construction of effectively organized vertical structure, able to function as a single organism and solve possible problems in the bud.
What factors contributed to the choice of areas of activity in life? Why was chosen as the real estate market? How did you come into this business?
The main factor is following the family tradition. My father - Honored Builder of Ukraine and all of my adult life is inextricably linked to the world of building, design, architecture. From the 9 grade of school I went through all the steps of the career ladder - from the laborer at a construction site to the director of development company.
What kind of education we should have today to work successfully in the real estate market?
The level of applied techniques and technologies, continuous development and diversity of trends and styles in modern construction are priori for success and forced to have at least higher profile education. Naturally, in conjunction with a true vocation to the profession and a constant quest for perfection.
What qualities should have the head of developer business?
The main quality of a leader of any business, especially such a complex and diverse as real estate development process is the ability to work with staff, effectively manage human resources. This requires systematic thinking - the ability to look on the situation in the complex and simultaneously adopt an individual approach.
What makes your stability?
The team. The people have to work every day shoulder to shoulder. On the reliability and professionalism which can be relied upon to tackle a host of everyday issues.
Did the crisis have influenced you personally?
There is no crisis in my life. Because a crisis for me - time for business, time to work. Work on upgrading the company, strengthening weaknesses, the allocation in the development of priority positions, consolidating resources and coordination to perform tasks. In the words of a famous Chinese thinker: «Weak is looking for an excuse for his inaction, strong - the way to towards the goal».
In your opinion, what stage of its development is now facing the real estate market in Ukraine?
The main difficulty of development today is not only in overcoming the challenges triggered by global financial collapse, but in the fight against panic, heated by media - in pursuit of the rated mass-media contest among the art works of the most terrible predictions and created the illusion of a comprehensive irreparable collapse.
Yes, the Ukrainian economy had turned out to be speculative and financially bankrupt, but it is well known that the crises in many ways makes healthier economic life, free of unnecessary ballast dubious commercial structures and weaknesses of the projects.
What problems exist at the real estate market today?
The low level of confidence in the once very reliable means of capital investment. Today, a square meter has lost its position as the most secure investment and in the eyes of the major holders of capital, and in the eyes of small private investors.
In this case the level of corruption that emerged in the past years around this «tasty morsel» of the economy does not submit its position - just as the questions right of way and approvals and legal documentation are not regulated and are associated with strong pressure from public institutions and their structures. This discredits the attractiveness of investment in construction in the eyes of both domestic and foreign investors.
What do you think what development projects will be success in the future?
The success of any development project is literate conceptual design and a suitable place for its implementation, multiplied by the competence of the developer.
As practice shows, the least risky investments are in the construction of shopping centers today, the demand for space in which was high even in the collapse of the real estate market. And naturally, in the eyes of investors the most attractive will look the first major industrial cities - Kiev, Donetsk and Odessa.
What are your predictions about development of the Ukrainian real estate market in 2010-2011?
There is no evidence of real tangible growth yet, but already there are some positive points - thawed many construction sites and even entered the market for new projects and residential real estate. Further intensification of the players is inevitable, but there is still some leeway for the holders of the capital of waiting, terrified panic and not willing to take risks.
Prices during this period would be stable - the fund for the unsold apartments crisis year yet cover the low consumer demand. In the next two years, the probability of recovery of mortgage lending is weak, but in general the interaction of the banking sector and the various sectors of the economy to normal.
Now all the expectations associated with specific actions of the government and its promises to «restore order» in the legislative framework, in particular, to create special laws in the field of taxation and banking.
In the years 2010-2011 there will be still fresh memories of the consequences of economic instability, and a sharp recovery in demand in the real estate market can be expected. But, of course, the purchasing power will gradually grow and, in turn, will trigger increases in housing prices. However, the actual timing of return operations to the level of 2008 will come no earlier than 2012.
INFORMATION SHEET
Date of Birth: December 29, 1985
Place of Birth: Kiev
Education: Kiev National University of Construction and Architecture
Position: Director of development company City State
Marital status: single
Hobby: sports (skiing, soccer)
