Ocean Plaza’s former developer Vasyl Khmelnytsky has said that he may buy back the Kyiv shopping center from Moscow-based company TPS Real Estate. TPS is currently owned by Russian tycoons Igor Rotenberg, Alexander Skorobogatko and Alexander Ponomarenko.
“Negotiations are under way for the acquisition of Ocean Plaza from the controlling company,” Khmelnytsky said in an emailed statement to Kyiv Post. “I think that (Ocean Plaza) now costs less than what we sold it for.”
Khmelnytsky said that TPS Real Estate had acquired the shopping center for $350 million, whereas it’s now valued between $250 million and $300 million. He added that he is still in the negotiating phase and no final decision has been made.
“Everything depends on an audit and there are a few more things we want done,” he said, without going into any more detail.
TPS Real Estate did not immediately respond to requests for comment on March 12.
Khmelnytsky had told newspaper Ekonomichna Pravda that he is concerned about the businesses and thousands of employees working at Ocean Plaza and doesn’t want to see them all out of work if the center fails to find a buyer and is forced to close.
The 165,000 square-meter mall at 176 Antonovycha Street opened for business in 2012. Ocean Plaza was jointly developed by Khmelnytsky’s company UDP and real estate developer KAN Development, owned by Igor Nikonov. Nikonov served as Kyiv Mayor Vitali Klitschko’s first deputy mayor from 2014-2015 and is currently an advisor to Klitschko.
The mall was jointly controlled by companies belonging to Khmelnytsky and real estate investor Vagif Aliyev before TPS bought it out in 2012. TPS has wanted to exit the Ukrainian market by selling Ocean Plaza as early as 2014, according to media reports, however no buyer has yet been announced.
Later reports speculated that TPS was negotiating with Dragon Capital for Ocean Plaza’s acquisition some time in 2018. Aliyev’s Mandarin Plaza Group also confirmed to Ukrainian media that it was considering the acquisition.
Khmelnytsky said that he is aware that other companies are interested in the acquisition, but he declined to name them.
Khmelnytsky is a high profile investor and developer. His current most visible projects include Unit City, an industrial park for tech and UDP Renewables, which builds solar power plants. The businessman also organizes the Kyiv International Economic Forum and owns Sikorsky International Airport in Kyiv (formerly Zhuliany), which UDP developed.
He had also dabbled in politics, being a lawmaker for Batkivshchyna party, before switching to fugitive president Viktor Yanukovych’s Party of Regions, quitting shortly before the EuroMaidan Revolution in 2014 that ousted Yanukovych.
According to Dragon Capital’s director of private equity, Ukrainians’ disposable incomes recovered sufficiently to see healthy growth in the country’s retail sector.
Several firms, including Dragon Capital and Mandarin Plaza are betting their investments on strategically-located shopping centers.
