Residents rebelled against the planned project in Žirmūnai: they fear the apartment building will become a “ghost building”

Worried about the neighborhood

Although most of the real estate market in Lithuania and especially in Vilnius is occupied by large real estate development companies, small developers are also active participants in the housing segment. Small real estate companies may not be inferior to large ones, they develop original and high-quality apartment blocks, but there are also, as real estate experts say, “one-day” companies that do not have sufficient funds and begin to plan, sell and build objects, but not finish. In this case, not only the buyer of said property suffers, but also the residents of the unfinished neighborhood.

Residents of the Vilnius Žirmūnai district also shared their concerns about the future project and the developer’s possibilities to implement it. According to the people of Žirmūnai, an apartment block is planned to be developed in their neighborhood, but residents doubt that the developer will be able to start and finish such a project. Residents wrote down their questions and their position regarding the planned neighborhood object in a complaint filed with the Vilnius City Municipality and the Žirmūnai Elder.

According to the people of Žirmūnai, in the complaint they ask to take into account the possibility that the company providing the construction project will execute the planned project due to the minimum number of employees (two employees) and the turnover. Additionally, residents learned that the company is subject to tax relief measures, has been operating for three years, and its director is involved in a multi-department project that has not been fully implemented. For a long time, only the “skeletons” of the apartment building remained standing.

“The question arises who will be specifically responsible for the planned project and the consequences if the project is not carried out / executed correctly (deadlines, construction freeze, bankruptcy of the company and other possible risks)”, emphasize the neighbors in the complaint.

Residents are also dissatisfied with the design solutions of the planned development (it should be noted that the public discussion of the project with the residents took place on August 3, so the project can still be adjusted). First of all, the people of Žirmūnai do not agree with the height of the planned building because, according to them, a taller building than the existing one will likely create more shadows, potentially worsening the quality of life and health of the inhabitants. surrounding residents.

In addition, the construction of the planned house, according to residents, can adversely affect the safety of the bearing structures of the nearby apartment building (especially the dangerous demolition of the slope). In addition, construction can prevent access to special services directly to the house and owners may find it difficult to access the underground parking of their home.

“Please note that residents are opposed to any restrictions on foot traffic (especially for the disabled, parents with infants and wheelchairs) and special services on the slope, as this will disproportionately affect the quality of life of residents surrounding for possible commercial benefits. ” said the complaint.

Municipality: coordinated project, not developer

Delfi Būstas asked a number of institutions. First, the Vilnius City Municipality was asked about the specific project in Žirmūnai and the questions on liability listed above.

The comment provided by the Chief Architect of the Municipality states that “according to the solutions of the General Plan of the Municipality of Vilnius City, the plot enters the urbanized areas of the Intensive Construction Zone, where the number of floors” depth ”allowable is 6 stories. The task of preparing project proposals establishes a number of floors less than allowed by the solutions of the general plan, establishes 1-5 floors. Also, assess the context on the north side of the 5-story apartment buildings, in the south 9-story apartment buildings. Residents are invited to actively participate in public deliberation procedures and submit suggestions and comments to designers, to which the designer must respond in accordance with the procedure provided by law. Comments Proposals will be evaluated after public consultation procedures have been duly completed and designers have submitted an application for approval of design proposals with all mandatory public consultation documents, design proposals, etc. “

When asked if the developer was interested in developing the project before approving it, the answer was that “coordinating a project is a coordinated project, not a developer.”

“There is hardly any legislation that regulates penalties for developers for projects not implemented,” said the response.

The developer is also not evaluated by other institutions

Does the State Inspectorate for Spatial Planning and Construction pay attention to the reputation of the developer and the opportunities to develop the real estate project? According to the Inspection itself, it is only responsible for the construction process, and the Ministry of the Environment could install fuses for the execution of projects of real estate companies. However, the ministry, for its part, assures that this is not its competence. As the guarantee that buyers will get their money back if the house they buy is not built because of the company.

“We would like to inform you that in accordance with applicable laws, government resolutions and regulations of the Ministry of the Environment approved by the Government of the Republic of Lithuania in 1998. September 22 by resolution no. 1138 “On the approval of the regulation of the Ministry of Environment of the Republic of Lithuania”, the regulation of civil legal relations is not assigned to the competence of the Ministry of Environment. We note that the contractual relationships of construction contracts are regulated by the Civil Code of the Republic of Lithuania ”, replied the Ministry.

There is no regulation

Mindaugas Statulevičius, president of the Lithuanian Real Estate Development Association, says that there are no minimum requirements for those who want to participate in real estate development activities. According to him, such regulation is very deficient.

“In general, the definition of who is a real estate developer appeared in the Construction Law in 2014 and that concept needs to be clarified. The definition must be tied to someone, because now no one is formally prohibited from calling himself a real estate developer or client and engaging in construction work. Of course, there must be permits, there must be legal personality, and mandatory prohibitions must be introduced in the process. If the project is financed by a bank, then analyze in detail the reliability and financial sustainability of the company. But if the company builds with its own funds, it receives permits, there are no additional inspections ”, emphasizes the interlocutor.

According to him, in such cases, reputational issues are also relevant. There are companies that create a project and then the company is liquidated. Later, the same owners may create another company under a different name and develop one or more projects.

“Large companies have a clear structure, they operate for a long time and they take care of reputation, customer relationships, and so on. And some companies may specifically hide their structure and try to withdraw from the developed project as soon as possible so that there is no need to meet warranty or similar obligations. On the other hand, even if their name is mentioned in the public space in a negative context, for them it is the same, because they will develop another project with another name ”, explains M. Statulevičius.

According to the president of the LNTPA, state regulation of real estate development activities is insufficient and this is obvious.

“We have repeatedly asked the Ministry of the Environment that we need to create a certain standard or think about a certain certification of real estate activities. This could be to ensure that the company, its owners and co-workers have sufficient knowledge to carry out such activities. There could also be some kind of referee for the developers. We, in turn, are carrying out a project of this type “Real Estate Academy” and during it we want to bring real estate development companies not belonging to our association closer to real estate development processes: legal, urban procedures, financing, management, etc. We have created such a three-month course, and perhaps by gradually expanding it, it could become a certain market standard, an educational tool for market participants, ”says the real estate expert.

Great attention to purchase and sale documents.

Regarding the possibility of buyers recovering their money if the developer does not implement the project, Delfi Būstas contacted the State Consumer Rights Service, which reported that “in cases where the seller has been declared bankrupt – a bankruptcy decision The State Consumer Rights Protection Service (SCRPA) will not be left out. In this case, according to the Law on Business Bankruptcies of the Republic of Lithuania, creditors have the right to submit their claims and supporting documents to the insolvency administrator within the time limit set by the court. The claims of the creditors may be satisfied in accordance with the procedure established by said law. If the bankruptcy procedure was not declared to the seller, the law that governs consumer rights would apply, also taking into account the agreements between the consumer and the seller – sales contracts concluded ”. In other words, when buying a home, in any case carefully Acquire documents that can become a guarantor in case the builder defaults on his obligations.