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14/10/2014, News

Good architecture for free

Boris Levyant - Architect, Head of the architectural bureau ABD architects - about the Russian commercial architecture

- What is special about commercial architecture?

Boris Levyant: High level of capitalization in compliance with all technical standards and regulations.
Recently I have got an approved project, which is impossible to realize. Last century! We have changed the project, now it will be actual for the next 10-15 years and have the same area. Otherwise, the customer would have to do new concept in 3 years already, spending about 30 percent of acquisition value. First of all, commercial architecture is business: building should be capitalized, i.e. it has to be profitable. The architect should always bear it in mind.

- What does capitalization mean? Is it a profit from the lease?

B.L.: Not only this. It also involves the sale price of the building, the asset price, and a set of buildings with a total market capitalization in the unified fund in IPO. It can be influenced by many different factors. As for example, the involvement of a particular architect can increase the capitalization within 2-3% of the market price, which is essential for the budgets of commercial real estate.

- Today there is an intensive construction in Moscow within the framework of the programme ‘comfort city’. Can these projects also be considered as a commercial architecture?

B.L.: Commercial architecture is not always aimed at solving problems of comfortable existence. Every building, which is used by people (offices, restaurants, accommodation) is built with respect to the maximum comfort of people, which is not the case of trade and commerce. Often in the design and organization of commercial space, the routes for buyers are deliberately increased, so that they can see a maximum of goods and services presented. Moreover, it is important to place the accents and to locate the participants.
The ‘comfort city’ has a different philosophy. However, what is comfortable for one - becomes uncomfortable for other. Take at least parking for example: green lawns were always defended and protected, now they are paved with asphalt for car owners.

- Recently there has been introduced a ban on the construction in the city center. Isn’t it concern about social welfare of citizens?

B.L.: Is it really banned? Such a ban is selective, and the term ‘concern’ is farfetched in this case. For instance huge territory is being overbuilt: no roads, no social structure. Does anyone need it? It is necessary to put another task: to intensify the awareness-rising efforts of everyone to maximize mobility, to develop the market of rental housing. The management of apartments is simpler and more transparent. And the mobility of young generation is now much higher than before. Buying an apartment – is the relic of the past of the Soviet-era. And there is a lack of apartments on the market today. The availability of different options and opportunities in different areas of the city - this is the concern about the people.

- What format is currently the most demanded among tenants? Shell-and-core?

B.L.: On the one hand, shell-and-core is in stable demand, on the other hand this format entails additional difficulties, the necessity to solve problems, and many tenants prefer ‘to pay and forget’.
In Europe, the law requires that the builder installs ceiling and lighting in the building, and, honestly saying, the fire regulations are completely different there. In Russia it is more complicated, although these rules can be circumvented by signing a simple fire declaration. In this case the owner takes the responsibility, and submits no claim to the state. These are two parallel realities.

- Now a quarter of space is vacant - how do you assess this phenomenon?

B.L.: This is a sign of approaching ‘underside’. When it finally appears, a real business activity starts. This is the rule. First, large funds and banks ´wake up´ and start buying cheapened property. And the vacant space will eventually find its tenant.

The biggest deals of Russia were made in 2009-2010: TNK, Rosbank, Siemens; large companies solved their problems. Those companies, which had 30-40 different offices, united them. It is done when the price is very low. The lowest price comes when the overproduction is substantial enough. And then the best survives.

The introduction of property tax will also push the prices to fall. The seller’s market transforms into the buyer´ market, like it was during crisis time. Today there is an oversupply of vacant space, and to change the situation, someone has to take the risk and reduce the price. After the commissioning of BC ‘City’ and relocation of Gazprom, the rental price will reach the European level in few years.

- Recently it was believed that the planners are not involved in the decision-making process on the legislative enactment on urban planning. Has the situation changed?

B.L .: We are often offered to participate in the discussion of technical terms while the adaptation of the European standards, however, the changes that have to come in force in terms of architecture, have not been introduced.

The influence of the civil society in Russia is small, so commercial short-term interests prevail here. And I have no time to get engaged in legislative activity. And is it necessary?
- Does your company design any projects in Moscow now?
B.L.: Yes, for example - the second phase of the business park ‘Western Gate’ on Mozhaiskoye shosse: 60 thousand meters are under construction.

Boris Levyant - Member of the Jury of the Best Office Awards 2015

Author: Mila Dementieva

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