A 35-year-old Ukrainian banker is backing a suburban home development which experts said is bigger than any other real estate project in Ukraine.
The Olympic-Park “kotedzh” development, the Ukrainian term for suburban homes, is being spearheaded by Mykola Lagun, the founder of Delta Bank, a top consumer lender in Ukraine.
Located 19 kilometers from the Kyiv city limit along the Kyiv-Zhytomyr highway, construction of the complex kicked off in May 2007. When completed in 2013, Olympic-Park will consist of 1,030 kotedzh houses.
The Europe Development Company, founded by Lagun, is targeting “top managers of Ukrainian and foreign companies with average monthly incomes starting at $4,000,” said Lidiya Novoseletska, the firm’s spokeswoman.
More than 100 homes have already been built and sold for prices that range between $230,000 and $500,000, roughly the same price for homes in dozens of other Kyiv suburban subdivisions currently under development.
Europe Development is building homes between 150 to 350 square meters according to 21 different designs developed by “Ukrainian and Russian architects.”
Each house will have a land plot between 1,500 and 3,500 square meters, Novoseletska said, and the community will offer a 60hectare recreation area.
Europe Development, founded in 2007 by Lagun, is financing construction with its own funds and bank loans.
Between 1998 and 2005, Lagun worked as head of treasury at Ukrsotsbank. In 2006, he founded Delta Bank, which swiftly captured about a quarter of the consumer lending business in Ukraine.
Lagun also owns a debt collection company called Credit Collection Group, the Delta Capital asset management firm, the Brama Zhyttia insurance company, the Delta Open Pension Fund, and AtomBank in Belarus.
OlympicPark gets “high marks” from Volodymyr Stepenko, marketing director of Kyivbased SV Development Company, which consults on land and the suburban housing market.
The complex was designed in a highly professional manner, he said, adding the quality corresponds well to the pricing policy.
“As of today, OlympicPark is first place in total number of houses among all kotedzh hoe complexes currently being built in the Kyiv oblast and Ukraine,” Stepenko said.
Larger developments are still in their planning stages, he said.
In the Kyiv oblast, 22 other kotedzh complexes have been built with 1,100 total houses, Stepenko said. In total, 56 kotedzh developments are being constructed that will provide an additional 8,000 homes.
About 30 kotedzh complexes are in the design phase at this moment, and should provide more than 12,000 homes, he added.
Suburban housing developments will rise in popularity during the next two years, said Valeriy Kirilko, managing partner of Concorde, a Kyivbased real estate services provider affiliated with Concorde Capital investment bank.
“In the next 10 to 15 years, suburban real estate will not fully substitute residential city housing,” but will be used primarily as additional housing for city residents, he said.
The main share of suburban development is in the Kyiv oblast, but activity is picking up around Donetsk, Lviv, and Dnipropetrovsk, he added.
In addition to Europe Development Company, some of the main players in the market of kotedzh house complexes include Kyivgorstroy2, Zoloti Vorota, DeVision, KPMK2 and others, market analysts said.
