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Real Estate

Text James Brooke

The steel-and-glass canyons of Moscow-City echo with the clang of construction. But inside the tallest tower, the sound today is of office workers ripping open packing boxes. Companies are moving into Naberezhnaya C, a 61-story high-rise that with little fanfare is now the tallest occupied building in Europe.

“We see this as becoming the real business center in Moscow in years to come,” said Juha Purovesi, head of finance and administration at KPMG Russia and the CIS and a partner in the financial services firm. Since December, the company has moved 1,700 employees into the new tower, almost halfway toward its 2010 goal of basing its entire Moscow workforce of 3,700 employees in the complex. “Renaissance Capital has moved in. Standard Bank has moved in.”

Emerging from 15 years of planning and construction, Moscow- City is to see four new office buildings open for tenants this year. By some projections, the number of people working in Moscow-City is to grow 10-fold over three years: from 4,500 in 2007 to 22,500 this year to 45,000 by the end of 2009.

“Moscow-City is finally coming to life; it is really going to take off this year,” said Frank Williams (pictured at right), a New York architect whose Mercury City Tower, a 70-story high-rise, is expected to be ready for occupancy in 2010.

At completion, optimistically by 2014, Moscow-City’s workforce is to reach 200,000. With banks and financial services companies expected to dominate tenant rolls, the area may soon become Russia’s Wall Street.

“What we have delivered in our new Moscow offices at least matches the very best to be found in any of the more established global financial centers, such as London, New York, Tokyo, Hong Kong, and Singapore,” said David Adamson, global head of corporate services for Renaissance Group, after orchestrating his company’s move this spring from offices near the Kremlin to the Naberezhnaya complex, which consists of three interconnected office buildings that house such firms as Citibank, Lehman Brothers, and Symantec.

As the illuminated towers become increasingly noticeable at night, city residents are getting a foretaste of Moscow’s new corporate face. Five years from now, this complex four miles west of the Kremlin is to have 4.9 million square feet of office, retail, hotel, and residential space — three times the size of London’s Canary Wharf, a complex with a similar number of buildings. In New York terms, this 60-hectare area, formally called the Moscow International Business Center, will contain the square footage of almost 20 Empire State Buildings, including several thousand hotel rooms and enough residential space for 4,000 apartments.

Next year, tenants are to move into Federation Tower West, the 63- story building recognizable by the letters VTB, for the state-controlled Russian bank that is the building’s main tenant, stenciled in black near its glass-sheathed top. In a preview of the mixed-use design of many of the buildings, Federation Tower will start with basement parking, have retail at the ground floors, then offices, and then several floors of apartments, interspersed with a hotel and a restaurant. At the same time, tenants are to move into the 62-story St. Petersburg Tower and the 73-story Moscow Tower, two multi-use towers which comprise the Capital Cities complex.

Foundation work is under way for Russia Tower, a Soyuz rocketshaped, 120-story building that is to soar 2,009 feet into the sky, 759 feet taller than the Empire State Building. If completed on time, in 2012, Russia Tower is to be the second-tallest building in the world, topped only by the half-mile high Burj Dubai. It will be the centerpiece of Moscow-City’s architecturally diverse group of skyscrapers, which will be among Europe’s tallest.

Six decades after Stalin’s wedding-cake buildings reshaped the city’s skyline, Moscow is again going aggressively vertical.

What is happening in Moscow-City “is unprecedented because so many very tall buildings are being built simultaneously,” said Thomas McCool, vice president and regional manager of Europe for Turner International, which is managing the construction of the Federation Towers. At present, Dubai leads the world in high-rise construction, but Moscow and Shanghai are rivals for second place, said McCool, a member of the steering group of the Council on Tall Buildings and Urban Habitat.

Instructed to avoid steel-and-glass “shoeboxes,” Russian and foreign architects have designed a collection of visually spectacular structures for Moscow-City. The City Hall’s Wedding Palace, a new locus for Moscow weddings, is to be a double helix spiraling skyward. Visitors to the Federation Towers will ride a glass-paneled elevator up 60 stories before reaching the light at the end of the vertical concrete tunnel: a sun-lit sky-bridge leading to the reception of the Grand Hyatt hotel. The next stop will be an observation deck on the 91st floor.

Viewed from a distance at night, Moscow-City will present a tableau of sharp angles, off-kilter boxes, swooping curves, and winter gardens, all bathed in multicolored lights and reflected in the black water of the Moscow River.

Visitors arriving by air will take dedicated airport express trains south from Sheremetyevo and north from Vnukovo aiports. To feed and supply this small city without trucks, goods will arrive by boat to a new wharf on the Moscow River. From there, automated cars will shuttle freight through an underground tunnel network, stopping directly at the skyscrapers’ freight elevators.“It will be like science fiction,” said McCool, the American construction manager.

Construction is expected to continue at Moscow-City despite a worldwide squeeze in real estate financing. The project carries enormous international prestige for Russia, and the government wants to have most of the 30 planned buildings standing by February 2014, the month when the Sochi Winter Olympics will focus world attention on the country.

“Moscow has been quiet for 60 years,” Williams, the architect, said in an interview in his Manhattan office, referring to the last time Moscow’s planners tried to compete with New York. “Then, all of a sudden, because of this new gas and oil money, everyone needs a presence there overnight. This very strong demand is occurring just as Moscow-City is coming up.”

For pioneers at the complex, complaints center on traffic problems, isolation from shopping, construction noise and dirt, and a shortage of parking.

The extent of the latter was evident recently at one tenant’s office, where the employee bulletin board advertised a ‘’parking space lottery.” The company had only 60 spots for 200 employees, and if official forecasts hold up, parking is to get twice as tight: By 2014, there are to be 30,000 parking spaces for 200,000 workers.

Moscow Mayor Yury Luzhkov has ordered the construction of more parking, but the majority of workers are expected to commute by mass transit. With the number of workers swelling monthly, the frequency of trains on the Moscow-City spur line has increased from once every 15 minutes a year ago to once every five minutes at rush hour today. Some use a nearby station served by an elektrichka (commuter train). City planners are studying the use of hydrofoil river ferries to bring in workers from Moscow’s affluent northwest suburbs.

“A food expo is a nightmare — the loading and unloading blocks all the lanes,” one Moscow-City office worker said, referring to traffic jams outside Expo Center, a trade exhibition hall nearby. Complaining about the dust from construction trucks and clamor of air compressors, she added: “There is no place to walk around, to take a breath of air, to enjoy green grass, some nature. It will be a beautiful and nice place when it is all over.”

For now, though, housing modules for construction workers cover sections of riverbank that by 2012 are to become parks, walking trails, and picnic areas.

Commercial isolation is ebbing as services move in. On a recent day in the basement of Naberezhnaya C, an entire Starbucks was poised to open. Nearby, well-lit corridors held a series of firsts for Moscow- City — a beauty salon, an optician, and a dry cleaner. A World Class Fitness Center is coming.

More amenities will arrive in two years, when the Central Core is expected to open. Roughly the size of Red Square, this horseshoeshaped structure will have 180,000 square meters of retail space, 6,000 seats in a concert hall and movie theaters, direct metro access, and 2,763 parking places. Some shops will operate 24 hours to serve surrounding buildings.

“You will go from the subway, through the shopping areas to your elevator bank — just like in Rockefeller Center, without going out in inclement weather,” Williams, the New York architect, said, referring to the venerable office complex in midtown Manhattan, the 1930s forerunner of what is being built for 2020s Moscow.

James Brooke is director of external relations and special projects for Russia and the CIS at Jones Lang LaSalle.

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