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IUE hosted a panel discussion on “Implementation of Built-Up Area (Brownfield) Redevelopment Projects: Russian and International Practice”

Дата публикации: 26.06.2017

On June 20, 2017, a panel discussion on Russian and international practice in redevelopment of built-up areas was held in the IUE. The host organization presented the results of its independent survey “The City to Live In” carried out in 2016 and funded through the IUE Endowment, and also presented a publication with the survey results.

In 2006, the instrument called ‘redevelopment of built-up areas’ was adjusted within the Town Planning Code of the Russian Federation. Despite the attempts at using the instrument in many cities, it has not yet been used on the scale as expected. A year ago some adjustments were also introduced. “It is now clear that the current legislation can hardly be used in practice for solving the problem of dilapidated areas”, said N. Kosareva, IUE President, in her opening speech.

At the same time, there is a huge amount of international experience in that direction. The international practice could be explored, in the first place, for the purpose of assessing the potential risks and possible adverse effects. “It is necessary to take into consideration the negative aspects when introducing the redevelopment issues on the agenda of urban development, and take preventive measures in order to avoid adopting the negative practice”, explained N. Kosareva.

Tatyana Polidi, IUE Executive Director and Head of the Real Estate Market Department, presented the results of the IUE’s analysis of the Russian and international redevelopment practice to participants of the panel discussion.

Representatives of governmental bodies, financial institutions, developers and expert community were among those who contributed to the panel discussion. The panellists recognized the importance of partnership between municipalities and private investors that ensures the most effective distribution of risks and allocation of organizational commitments and liabilities as these relate to redevelopment projects.

In summarizing the panel discussion, N. Kosareva, IUE President, highlighted the need for improving the legislation on further development of built-up areas, including with due account for the new legislative proposals for implementation of the housing redevelopment programme in Moscow. The approach proposed by the city of Moscow, including the consulting of its residents’ opinion, is consistent with international practice. This first experience will provide opportunity for testing and improving the necessary mechanisms, identify and take into account possible mistakes and miscalculations so that other Russian cities could also draw upon the available expertise.

Key findings

1) International experience attests to the fact that redevelopment programmes and projects may bring about negative as well as positive effects.

2) Urban redevelopment programming should take into account the evaluation of the factors as follows:

- impact of the programme on household income, budget revenues, real estate prices, investment;
​- urban economic effects and macroeconomic effects on the programme.

3) The key to success of the projects lies in finding the right balance between town planning and economic parameters.

4) A very wide range of mechanisms for interaction with property owners is used around the world to get them involved in redevelopment projects.

5) To enhance the enabling environment for investments in built-up area (brownfield) redevelopment projects it is necessary to expand the use criteria which imply the inclusion of the objects that fail to conform to the Land Use and Development Regulations.

6) The analysed municipal targeted programmes for resettlement of residents from dilapidated and hazardous buildings cannot be justified economically or in terms of their town planning prospects.

7) It is necessary to introduce a new technique for redevelopment programming and for preparing the auctions for built-up area (brownfield) redevelopment and greenfield area development.

8) It is advisable that new mechanisms for interaction with property owners within redevelopment projects be created to ensure the transition from the practice of forcible taking of property to taking into account the opinion of owners.

9) A positive precedent has been already set as part of a bill on redevelopment in Moscow bill (the voting by owners).