Not only Zenit Arena: Why St. Petersburg is always under construction? 

Not only Zenit Arena: Why St. Petersburg is always under construction?
Developers favored in Smolny Palace ‘use’ the entire budget of a project and then switch to another governmental construction site Photo: The CrimeRussia

St. Petersburg is quickly transforming from the capital of culture to the ‘capital of never-ending construction’. In addition to widely-known Zenit Arena with its cost over 40 billion rubles, there are other idle construction sites in the city; their total cost has already exceeded 16 billion rubles and continues growing.

All never-ending construction projects in St. Petersburg have a number of common features: governmental funding, major budget, limited list of developers, and no results. Developers favored in Smolny Palace ‘use’ the entire budget of a project and then switch to another governmental construction site – while the customer announces a new tender to complete the previous project. The amounts of governmental contracts remain effectively the same, so everybody is happy. 

Good bye, boys!

Should St. Petersburg construction projects compete in their cost, the Cadet Corps located at 17 Moskovsky avenue (Konstantinovskoe Military School) would win a silver medal. The customer, Chief Directorate for Troop Accommodations, had signed the first contract to reconstruct the Cadet Corps with Intarsia company in March 2014. The contract cost was 4.8 billion rubles, and the works had to be completed in two years. 

But cadets of Suvorov Military School were not fated to throw a housewarming party – in summer 2015, the customer has terminated the contract with Intarsia, who, in fact, had stopped all works on site by that time. The new tender for reconstruction of Konstantinovskoe Military School at the cost of 4.1 billion rubles has been won by Demetra company.

Стройплощадка Кадетского корпуса

Construction site of the Cadet Corps 

It would be logical to assume that the 700-million-ruble difference between the two contracts reflects the amount of works completed by Intarsia. So, it has performed only 20% of the contracted works. No one can say why did not the Chief Directorate for Troop Accommodations terminate the contract with a company unable to fulfill its obligations earlier. The military institution had attempted to recover 3 billion rubles from the contractor, including 1.79 billion rubles prepaid to Intarsia. However, the court of original jurisdiction has upheld the claim only in part and ordered Intarsia to pay 2 billion rubles. The court verdict hasn’t come into effect yet, while Viktor Smirnov, the key owner of Intrarsia also known as the ‘Kremlin restorer’, resides comfortably in the UK. 

Demetra is supposed to complete all the works. However, the performance of the new contractor does not inspire much optimism as well. It is necessary to keep in mind that Konstantinovskoe Military School is an architectural monument, and its reconstruction might have truly drastic consequences.

According to the All-Russia Society for Protection of Historical and Cultural Monuments, no works are currently being performed on site, and there is no heating in the building with historical paintings and moldings. The All-Russia Society for Protection of Historical and Cultural Monuments had addressed the Prosecutor’s Office, Ministry of Culture and Committee for Monument Protection and received standard responses that all required steps are being taken.

Unfinished projects of Mostostroy

As said earlier, several contractors favored in Smolny Palace are switching from one construction project to another – receiving money everywhere but not having enough time to do their job. The most notorious among them is Mostostroy № 6. Currently this company, who used to win billion-ruble contracts, is bankrupt

Mostostroy № 6 was the general contractor in the construction of Sinopsky underground tunnel, road interchange on Piskarevsky avenue, and two road sections on Obvodnoy channel quay. The total amount of governmental contracts awarded to the company is 10 billion rubles. The construction on Obvodnoy channel is ongoing since 2010. It is necessary to note that in every project, Mostostroy № 6 was the sole contractor. The contract for the first phase of the Obvodnoy channel reconstruction at the cost of 3.97 billion rubles has been completed. Then two new contracts have been signed: construction of a roadway along the southern side of Obvodnoy channel from Glukhoozerskoe highway to Obukhovskoy Oborony lane; and construction of a bridge across Frantsuzsky Kovsh channel ( contract № 1, contract № 2). The total cost of the new contracts was 4.4 billion rubles. But in 2015, the contractor has stopped all works. In addition to Obvodnoy channel, the unfinished road interchange at Nepokoroennykh and Piskarevsky avenues priced at 2.9 billion rubles and troubled Sinopsky underground tunnel worth 1.1 billion rubles have been abandoned.

After the termination of contracts with Mostostroy № 6, the company management has stated that the multibillion-ruble projects were profitless – although the builder had received some 6 billion rubles in the framework of the terminated contracts. It is necessary to note that Mostostroy № 6 had never rushed with the fulfillment of its obligations, for example, Sinopsky underground tunnel was supposed to be completed back in 2014.

Construction of Sinopsky underground tunnel Construction of road interchange on Piskarevsky avenue Construction of road interchange on Obvodnoy channel quay
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The tender spree has been resumed. A-Proect Limited Liability Company has got the interchange on Piskarevsky avenue. The total scope of works was broken into several contracts with the total cost of some 800 million rubles. The reconstruction of Sinopskaya quay from Obvodnoy channel quay to Moiseenko street priced at 1 billion rubles has been awarded to Geoizol company on a sole source basis. A few months earlier, Smolny Palace had conducted a similar tender where Saratov-based Volgomost company was a competitor to Geoizol. At that time, neither competitor was able to satisfy the customer. But the second tender, carried out on a sole source basis, has left everybody happy. The agony of choosing is unsufferable for the St. Petersburg Administration. 

How much to complete?

In addition to Mostostroy № 6, the following companies have failed to fulfill their obligations: Vozrozhdenie (Revival), Lenpromstroy, and Stroynovatsia (Summa Group). Stroynovatsia was involved into the construction of Finlyandskaya street at the cost of 1.9 billion rubles. After the termination of the contract with it, the Direction of Transport Construction has signed a new contract to complete the works with Orion Plus Construction Company. Although Stroynovatsia had performed works for the amount of 140 million rubles, not only hasn’t the cost of the contract with Orion Plus been reduced, but instead increased to 2.3 billion rubles.

Строительство развязки у Поклонной горы

Construction of road interchange near Poklonnaya Hill 

The main ‘traffic headache’ of St. Petersburg is the road interchange near Poklonnaya Hill. Its construction has started back in 2012 and is still far from completion. Initially, the general contractor was Mostootryad № 19 – later spotted at the construction of Zenit Arena. The cost of the contract with Mostootryad № 19 was 1.9 billion rubles; some 1.5 billion rubles out of that amount have been paid to the contractor. Then the city had to pay 330 million rubles for conservation of the construction site. Vozrozhdenie (Revival) company, who had performed the conservation, has suggested to complete the project. The cost of the new contract was 1.4 billion rubles. The question when the road interchange near Poklonnaya Hill is to be commissioned is rhetorical. 

Another vivid illustration of the abnormal situation in the city is the construction of a surgery pavilion for the municipal hospital № 33 in Kolpino. The building project has started in 2013, and four years later, no real progress can be seen on site. Initially, Lenpromstroy company was building it for 1 billion rubles. Then it became known that the construction was, in fact, stalled. Still, the Committee for Construction of St. Petersburg did not rush to say farewell to Lenpromstroy and has terminated the contract with it only in the end of August 2015 – which was the original completion date for the project. 

The negligent contractor managed to earn over 200 million rubles. RR-City and Priam companies are to complete the construction of the surgery pavilion. All the works have been broken into three contracts. The bureaucratization of the project and the new completion date extended to the end of 2017 do not inspire much hope for success,. A diagnosis to the entire management system of St. Petersburg is obvious: the patient is rather dead than alive.

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