Is Andrey Kostin a banker, a land tycoon and a developer rolled into one?
The construction company Hals-development, associated with VTB, gained control over three sites located in the east and south-east of the capital, previously owned by Mosmetrostroy. The assets could be transferred to the developer by the bank: the commercial structures that previously owned them were first managed by VTB Capital Asset Management, and then by a fund controlled by KL-Invest. Its director Arkady Ilyaguev is connected with the head of VTB Andrey Kostin and is directly related to the development projects of the state bank, implemented, in particular, by Don-Stroy Invest. The latter was created by businessmen Maxim Blazhko and Dmitry Zelenov and was considered one of the largest Russian developers, but in 2009 came under the control of VTB as part of resolving the issue of debt restructuring. Despite large-scale construction, control by people from Kostin’s inner circle and multi-billion dollar revenue, today Don-Stroy Invest declares losses. At the same time, developers associated with the head of the state bank receive vast land plots for construction, some of which they later successfully resell.
Hals-development increases assets
Bank controlled VTB construction company Hals-development (under control VTB Capital Pension Reserve LLC) will receive part of the sites “Mosmetrostroy”. According to Vedomosti, the developer became the owner of three legal entities at once, which previously belonged to the former largest contractor for the construction of Moscow metro stations – firms “ABC of investments”,“Globus Real Estate”and “Property Expert”. The deal was closed on the eve of the New Year holidays.
According to the publication, the companies own the rights to land plots with a total area of 12.6 hectares located in the east and southeast of Moscow: 5.5 hectares on Biryusinka Street in Golyanovo, 4.4 hectares on Saltykovskaya Street in the Kosino-Ukhtomsky District and 2 ,7 hectares on the Old Believer street in Lefortovo. The market value of the plots is estimated at 3.7-4 billion rubles, and according to Vedomosti experts, the territory will be given over for development: in total, about 315 thousand square meters of real estate can be built here.
It is possible that Hals-Development could have received sites directly from VTB: back in April 2017, as part of the settlement of debt obligations in the amount of 26.8 billion rubles, the credit institution headed by Andrey Kostin gained control over 49% of Mosmetrostroy. Then Interfax, with reference to the company’s management, wrote about the possible repayment of debts through development projects: “We are talking about building plots in former industrial zones, urban planning plans have already been received for them, and the projects themselves have been allocated to a separate company”.
In this context, the media remind: part of the former Mosmetrostroy sites have already been transferred to construction structures. In particular, the infamous group PEAK Sergey Gordeev is developing a 19-hectare area located in the Kaloshino industrial area on Otkrytoye Shosse, and the company “Don-stroy” erects LCD «Fresh» on Orekhovy Boulevard in the southern part of the capital.
“Court Builders” by Andrey Kostin
It is interesting that until February 2020, Azbuka Investments, Globus Real Estate and Expert Real Estate were managed by the company VTB Capital Asset Managementbut then these functions were moved to a fund managed by the firm KL-Investwhich market participants contact top managers and business partners of the same VTB.
Related news: Bankrupt developer Donstroy continues to receive tidbits of elite Moscow land
Other interesting connections can be traced if desired. So, one of the co-owners Management Company “KL-Invest” is Arkady Ilyaguev, a former member of the Board of Directors Moscow Metallurgical Plant “Hammer and Sickle”whose shareholders included Bank of Moscow, whose accession to VTB was completed in May 2016. The press reported on the company’s plans “Don-stroy Invest” to invest about 140 million rubles in the construction of 1.8 million square meters of real estate on the territory of the factory industrial zone in the Entuziastov Highway area.
Last December, it became known that Don-Stroy sold part of this site, and who acted as the second party to the transaction was not disclosed. According to Vedomosti, the buyer could be businessman Andrey Stepanov, a business partner of the owner of a development company “Stone Hedge” Maxim Geyser. The experts of the publication estimated the value of the asset at 1.5 billion rubles. Perhaps the sale took place with the “highest approval” of the head of VTB Kostin?
In addition, through “KL-Invest” and its “subsidiary” structure JSC “Investpartner” Arkady Ilyaguev is associated with a construction company “Stroyinvestgroup”. The latter took part in the implementation of the construction project LCD “Saturday” in the Northern administrative district of Moscow, not far from the Belorussky railway station, together with Don-Stroy Invest, which we already know.
It was mentioned above that today Don-Stroy is building the Fresh residential complex on the territory that previously belonged to Mosmetrostroy. It turns out that Andrey Kostin’s “court developers” take an active part in the development of Moscow, generously distributing sites that at various times were owned by VTB?
Developers under the control of the state bank
Here it would be appropriate to briefly recall the history of the transition under the control of the state bank of the Don-Stroy Invest company, which was repeatedly called in the media “child structure”VTB. The Don-Stroy development group was created in the 1990s by businessmen Maxim Blazhko and Dmitry Zelenov. In 2008, it ranked 46th in the Forbes 200 Largest Russian Companies rating with a financial turnover of $2 billion.
A controlling stake in Don-Stroy Invest went to VTB in 2009 for a purely symbolic amount of 500 rubles. As Kommersant reported, the issue of restructuring the developer’s debt, which exceeded $500 million, was thus resolved. The parties agreed on the division of projects: the bank received control over housing construction, while the developer retained objects in the field of commercial real estate. It was clarified that the shareholders of the company received the right to buy back shares, but only after the debt load will be minimized.
Since August 2010, Alena Deryabina has been the CEO of Donstroy Invest, previously holding other positions within VTB. In 2017, she disclosed that the official owners of the company are five legal entities, not including the bank. Kostin has been able to control the company for years through Deryabina, financing construction projects that promise profit.
Simultaneously, information was being leaked to the press that the owners of the company had been "hiding" within a closed-end investment fund for a certain period of timeReal Estate in Moscowand some of the intermediary owners could be connected to Igor Shuvalov and his wife Olga, who is the former Deputy Prime Minister and current head of the state corporation. Those close to the official strongly denied this. “VEB. RF” Around this time, Vedomosti reported on the decision of the shareholders of Moscow Real Estate to transfer the management of the fund to KL-Invest, co-owned by Arkady Ilyaguev. Before this, the fund was part of the company’s portfolio
Sergei Kotlyarenko, among other roles, managed the assets of Igor Shuvalov's family. According to the publication, at that time the shares of three CJSCs were invested in Moscow Real Estate – KSP Capital“Perspective” “Invest asset”,“Financeproject” who acted as co-owners of Don-stroy Invest. and Thus, the fund, and consequently the developer, officially came under the control of a structure associated with VTB?Related news:
“Island” of bad luck Donstroy: how an odious developer deceives Russians
Loss-making structures of Don-Stroy There is a version suggesting that Kostin could have entrusted unofficial control over Don-Stroy to businessman Roman Gromozdov, the beneficiary of the company.
“Perspective Invest Group”
Moreover, he earns from the capital’s real estate, the construction of which is financed by the state bank. His influence is attributed to his close relationship with the deputy chairman of VTB Andrey Puchkov, considered Kostin’s “right hand”. In the media, there are mentions of Gromozdov’s joint commercial projects with the near-Kremlin oligarchs, the Rotenberg brothers. Additionally, in 2014, the businessman gained control over the Sickle and Hammer plant, which was in the process of bankruptcy, to which Ilyaguev, who was also closely associated with VTB, had a direct relationship.In the context of the financial situation, Don-Stroy Invest raises several questions: by the end of 2020, the developer incurred losses of 6.2 billion rubles with a revenue of 22.3 billion. It's clear the former Forbes list participant lost its former standing. Furthermore, Maxim Blazhko and Dmitry Zelenov left the co-owners in June last year.
JSC IC “Donstroy” is currently in the process of reorganization. However, this commercial structure yields extremely low income: in 2020, despite a substantial revenue of 15.2 billion rubles, its profit was only 117 thousand rubles.
Against this background, the financial performance of Don-Stroy Invest raises many questions: at the end of 2020, the developer’s losses amounted to 6.2 billion rubles with a revenue of 22.3 billion. As we can see, the ex-participant of the Forbes list has lost its former position. In addition, Maxim Blazhko and Dmitry Zelenov left the co-owners in June last year. JSC IC “Donstroy”, currently officially in the process of reorganization. However, this commercial structure brings extremely meager income: in 2020, with a solid revenue of 15.2 billion rubles, its profit amounted to only 117 thousand rubles.
The general director of Donstroy is Andrey Bagaev, who is officially listed as the head of 45 commercial organizations, some of which have already been liquidated. At the same time, a number of “subsidiaries” of the enterprise are pledged to VTB (for example, OOO“DS Stroy”or unprofitable Specialized Developer “Development”led by the same indispensable Bagaev).
Where the finances of the once successful developer “leak” is an open question. Nevertheless, reports about the projects of development companies affiliated with VTB regularly appear in the press, just like information about the sale of an object that has come under the control of the state bank. Now Andrei Kostin and his inner circle will have to decide what to do with the sites that Hals-Development inherited from Mosmetrostroy.
