Moscow Region to Sell Off Land to Raise Revenue

29.08.2013

Based on the initial results of a land use audit, Moscow's regional authorities have decided to terminate the right to indefinite use and auction off 768 hectares of land. This amount is out of almost 4,000 hectares they own that were used inefficiently, a news report said Thursday.

The government of the Moscow region, which owns less than 1 percent of land in the region, has tasked officials to almost triple budget revenue from 346.467 billion rubles ($10.5 billion) to 1 trillion rubles by various means including the sale of land, Kommersant reported.

The Moscow region has a big deficit of available land. Deputy head of the regional government Alexander Chuprakov said last spring the region owned 21,500 hectares of its land, of which only 1,100 hectares, or 0.02 percent of the overall amount, was available for sale. Chuprakov said regional authorities would soon increase the total area of available land by another 20,000 hectares.

The authorities have cancelled ownership rights for land plots currently occupied by three colleges and a psychiatric clinic in four different districts in the Moscow region.

Maria Litinetskaya, head of real estate agency Metrium Grupp, estimates the combined value of those land plots at 1-1.3 billion rubles.

Termination of the right to indefinite use for a land plot requires the approval of both the current owner and his establishing body, Goltsblat BLP partner Vitaly Mozharovsky said. He believes officials have already come to an agreement among themselves, since most of the land in indefinite use is owned by state organizations financed by the budget and affiliated with specific ministries.

The right to indefinite land use does not confer any specific privileges, unlike long-term leases, which allows current landowners to sublease and mortgage the land.

According to a representative of a regional property management ministry, land plots on which the right to indefinite use has been cancelled will be sold at an open auction to investors interested in buying or leasing them for industrial use.

http://www.themoscowtimes.com/business/article/moscow-region-to-sell-off-land-to-raise-revenue/485244.html#ixzz2dQvo7fe1

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