Who will build 500 apartments for ?ód??

Five large investors want to build half a thousand apartments for ?ód?. The city will not pay even a penny for their construction but will rent them for several years as municipal flats

- Two months ago I told you that we want to acquire several hundred apartments from the market, and ultimately even several thousand. And we want these apartments to be built for us by a developer who will then rent them out to the city for several years. All this to be able to renovate places such as Plac Zwyci?stwa, next to which there are the first houses built in ?ód? by Karol Scheibler and which are seeking renovation - says Adam Pustelnik, the first vice-president of the city of ?ód?.

At the moment, ?ód? is involved in a large revitalization program, which includes 118 projects worth PLN 1 billion. In order to maintain the pace of investment and revitalize the next quarters, there is a need for flats that the tenants of those to be renovated can move to.

- I believed that the market would respond to our proposal and it happened. Five entities applied for negotiations, including some of the largest companies from the sector. - There is Muralpol in a consortium with Griffin Real Estate, than one of the 10 largest investment funds in the world - TAG Immobilien, a very famous German fund based in Hamburg, moreover there is also Scandinavian capital - Heimstaden, which has a large portfolio of municipal apartments in the Czech Republic. Bids were also submitted by Mirbud in the consortium and Aria Development - says Pustelnik.

It will take several weeks to analyze the offers, and the city will select the best three of them. In April, we will send invitations to the competitive dialogue. We assume that negotiations and, as a result, selecting a partner for the project will take us about a quarter.

- I am convinced that the negotiations will be successful and soon we will announce another procedure for even more apartments. Thanks to this solution, we want to acquire up to a thousand apartments a year from the market. Due to the fact that we do not have to build or renovate these flats ourselves, it can engage the released money in further areas of revitalization. Western cities are already successfully using similar solutions. In Poland, we will be the pioneers - emphasizes the vice-president of the city of ?ód?.

How it's working? Every investor wants his money to work. The profit on the rent he can get from the city is incomparable to any investment and is also stable because the local government is a reliable payer. For large market players, it is a very attractive and safe offer of capital multiplication.

For the city, this solution is also convenient, because it spends money on the construction of flats, and the number of flats is growing. He can use the saved money to other projects - renovate even more tenement houses. - The city bears only the cost of the difference in rent - it pays the difference from the tenant's rate. This is an incomparably lower amount than we would have to spend for the construction of new apartments - emphasizes the vice-president of the city.

Finally the tenant. Nothing changes for him, he will pay for renting a new flat as much as for a council flat.