Praha 8 terminated the contract with Metrostav for the Palmovka Center

Prague – The City Hall of Prague 8 has withdrawn from the contract with the construction company Metrostav, which concerned the construction of the Palmovka Center. The reason is the company's failure to meet its obligations and its refusal to continue construction. This was announced by the city hall spokesperson Marcela Konrádová today. Metrostav terminated the contract with the city hall for the construction last autumn. The city hall is now considering what to do with the unfinished building, one of the options being sale. The project worth 1.1 billion crowns was approved in 2010.

"The company Metrostav invalidly unilaterally terminated the contract in November 2018, before the new leadership of the city hall was elected. Since then, we have seen no minimum effort to cooperate with our municipality and fulfill its obligations. Therefore, we had to withdraw from the contract," said Mayor Ondřej Gros (ODS).

The city hall leadership is now considering what to do with the building next. Completing the construction could cost between 600 and 800 million, which the city hall does not have. In recent months, city hall representatives have begun negotiations with the municipality about a possible sale of the building's shell. Gros said at the March meeting of the Prague 8 council that besides completion and sale, there is the possibility of completing and commercially leasing the building. However, the city hall would have to take out a loan for that, which the mayor does not support.

The previous leadership of Prague 8 questioned the ownership of the building after the 2014 elections, and the property became the subject of legal disputes between Prague 8, the municipality, and Metrostav. Ultimately, the parties agreed that Prague 8 would complete the building, for which it was to receive 600 million from the city. However, last November, Metrostav withdrew from the contract due to missing expert assessments.

About half of the building was to be occupied by the emergency service, while the rest was to serve as the headquarters of the city hall. The municipality will now have to look for a new place to build the headquarters for the rescuers.