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Messenger VARSHAVSKY Plus residential complex – a new project by Stolitsa Group. It is a large-scale, eco-friendly, attractive, functional and rationally organized complex. But is everything as good in reality as they say? Our legal audit will help you sort everything out and draw attention to which contracts you will sign when buying an apartment and what their risks are.
- Document verification
- Investment scheme analysis
- Process analysis
- Transaction support
| Number of rooms | Area | Price per m2 |
| 1-room | 36 – 51 m2 | 24750 – 32950 UAH/m2 |
| 2-room | 64 – 86 m2 | 23300 – 26900 UAH/m2 |
| 3-room | 89 m2 | 23150 UAH/m2 |
Residential Complex Features
- Class – Comfort
- Buildings – 10
- Floors – 23-26
- Technology – monolithic frame
- Heating – autonomous (in the building)
- Walls – aerated concrete, expanded clay block
- Insulation – mineral wool
- Ceiling height – 2.7 m
- Parking – parking lot
Developer Stolitsa Group
To the general public, it is usually the developer that is known, not the builder.
Developer is not a legal term, but rather a marketing one. We look at the developer to assess the overall reputation of the residential complex. The Varshavsky + project is being implemented on behalf of a well-known and large city developer – Stolitsa Group. It already has completed buildings in the Galaktika residential complex, Varshavsky microdistrict, Lipinka, the residential complex on Bohatyrska and others.
Now let’s move on to the Builder. This is a legal term.
The developer is the one officially listed in the construction documents and the one who is responsible for construction. The developer of the Varshavsky Plus residential complex is the State Enterprise “Agrokombinat Pushcha-Vodytsia”. In the register you can read details about this enterprise, for example that it has the right to carry out construction work, has existed since 2002, and that the enforcement service is collecting some debt from it. The debt is actually small (about 9 thousand UAH). A former employee is claiming unpaid wages. It’s not scary.
Infrastructure in Vynohradar
The complex is being built in Vynohradar along Pravdy Avenue and will be an entire microdistrict of 9 hectares. Nearby are the Retroville mall, the Varshavsky microdistrict and Varshavsky 2.
The complex is being built in Vynohradar along Pravdy Avenue and will be an entire microdistrict of 9 hectares. Nearby are the Retroville mall, the Varshavsky microdistrict and Varshavsky 2.
The first 3 buildings were supposed to be commissioned by the end of 2020, but as of March 2021 not a single building had been completed.
Building permit for Varshavsky + Residential Complex
The building permit (exists and is current). But the permit was issued for the construction of 25-story buildings, while the developer’s website contains information about 26-story buildings. The latest amendments to the permit are from May 2020, but it still indicates 25 floors.
There are two outcomes – either the developer will make amendments to the building permit, or this will become a problem when bringing the buildings into operation. Many do not take such a point seriously and think it’s nothing, but it’s not.
Natalia ChatskisThe developer can build only what they were permitted to. Therefore always pay attention to how many storeys the building where you buy an apartment has.
Senior Lawyer of the Litigation Department
Land for the complex
Varshavsky + is being built on a large land plot measuring 80 hectares. The land is state-owned; its designated purpose is for residential and public development. So that is all fine. In addition, I obtained an extract from the Real Estate Register and confirmed that the land is registered, there are no arrests, and the developer has the right of permanent land use, which means he can build there.
Investment scheme of Stolitsa Group
To buy an apartment in Varshavsky Plus residential complex, you will need to conclude 2 contracts:
- Derivative
- Purchase and sale agreement of property rights
The essence of this scheme is as follows: an intermediary appears between the Buyer and the Developer — an asset management company. That is, the developer promises that in the future he will sell a specific apartment on specific terms, and these promises are formalized by a contract — a derivative. Then the asset management company sells this derivative to you, namely: the right to buy an apartment from the developer. Therefore, first you sign a purchase agreement with the asset management company for the derivative, obtain the right to apply to the developer, apply, and then buy the apartment from the developer, signing a second agreement with him — the purchase and sale of property rights. Usually under the derivative you pay about 30% of the apartment’s cost, the rest under the second contract.
Why is this necessary? It’s quite simple: under the derivative the developer does not pay taxes. The tax minimization scheme is legal and there’s nothing criminal about it. But it has one drawback for you — if something goes wrong, for example the building is not commissioned, and you sue the developer, you can only claim the amount you paid under the purchase and sale of property rights agreement, and you will not be able to claim what you paid under the derivative.
Both contracts that you will sign can be downloaded from the developer’s website. We can analyze the contracts in more detail when preparing for your apartment purchase transaction, but for now I can already draw your attention to a few important points.
- You are being offered to conclude the purchase and sale of property rights agreement with the company “Rielt-bud” (code 39375896), but this is not the developer. I remind you that our developer is the enterprise “Agrokombinat Pushcha-Vodytsia”. It appears that there is a separate agreement between the developer and Rielt-bud, under which this company has the right to sell apartments in Varshavsky +. Before the transaction, you should request this agreement from the sales department for review and verify that Rielt-bud is specifically authorized to sell your apartment in your building.
- The contract does not specify penalty sanctions for construction delays, and as we have already determined, the complex is already experiencing delays. Of course, you would like the developer to take responsibility for this and for a penalty to accrue for the entire period while you wait for your apartment. Only in that case will the wait be justified.
Court proceedings
Court proceedings should be checked for each company I mentioned above. But for the developer alone there are 48 judicial documents in criminal cases and 270 in civil cases.
I will voice the situations that draw the most attention to Varshavsky Plus.
This criminal case is the one that interested me the most. The last documents on it were published in mid-2020, which is not so long ago. Whether the case is still being pursued is unknown, because that information is closed. The parties to the case are also confidential, so I will not name specific companies. The essence of the criminal case is that a certain state enterprise is the user of the land plot. This enterprise concludes contracts with companies that organize construction on this land. For this, the state enterprise receives up to 5% ownership rights in the constructed housing. But! For some reason this enterprise, instead of receiving housing, decided to get money. The investigator believes that such an exchange was clearly dishonest, and the state enterprise had no right to dispose of state property in this way.
Therefore, the Pecherskyi District Court issued an order. The order lists a whole range of documents that the court allowed the investigator to inspect and seize copies of. Among those documents we see the building permit for Varshavsky +
And now some continuation of this story. In his interview the CEO of Stolitsa Group told a very similar story about the relations between the State Enterprise “Agrokombinat Pushcha – Vodytsia” and six companies with which the enterprise concluded investment contracts for the construction of the residential complex.
There is also a response from the State Property Fund online that discloses the names of these enterprises and states that these contracts harm the state enterprise.
The continuation of all this was that the state enterprise “Agrokombinat Pushcha – Vodytsia” filed lawsuits against these six enterprises to declare all the investment contracts invalid. All suits were filed on 19.05.2021.
At the moment all cases are under consideration:
- court hearing dates have already been set for two cases (LLC “Sitybudservice” and LLC “Oliver – Bud”)
- lawsuits against three companies were left without progress : LLC “Datolit”, LLC “Proektinvestbud”, LLC “Interproject” (at this time the court orders have not yet been published for these two companies). “Left without progress” means that the plaintiff made certain errors when filing (for example, incorrectly notarized documents). If the plaintiff corrects these errors, the court will continue to consider the case.
- there is no information yet on the case with LLC “Concord – DS Plus”.
If you are considering investing specifically in Varshavsky + residential complex, I recommend that you definitely consult a lawyer before buying a home.
Varshavsky Plus — problems you can avoid.
- Unfinished construction. In Kyiv alone there are 70 unfinished developments. 18 thousand apartments from which buyers will not receive keys.
- Long-term construction projects. In Kyiv there are 8 well-known long-term builds that have been under construction for more than 12 years.
- Completed project not matching what was advertised. This is when the developer said one thing, but the result turned out to be different. You expected to see a luxurious playground, but in fact there are three swings. The visualizations showed a green courtyard with mature trees and bushes, but in reality there is asphalt everywhere, dug-up patches of land around the perimeter and some shoots instead of lush crowns. They promised a yard without cars, but ended up with parking under the entrance. The pictures showed a beautiful lobby and corridors with finishes, but in reality plain Soviet-style entrances. There are many examples.
“Remember! Neither a realtor, nor the bank, nor especially the sales department will fully investigate all the problems with Varshavsky Plus, because they have one thing in mind – to close the deal and make their profit. Checking a new building and investing is your personal responsibility. Study all documents, check all aspects yourself. If you want to reduce risks to zero, order a full check and we’ll do everything for you.”