Prague 8 will pay Metrostav about 142 million CZK for the unfinished Palmovka Center

Prague – The Prague 8 municipality will pay the company Metrostav Alfa about 142 million CZK for the unfinished building of the Palmovka Center. The building, along with the land, will subsequently be transferred to the ownership of the capital city. This follows a tripartite agreement whose wording was approved today by the representatives of the city district. In exchange, Prague 8 will receive a subsidy of 550 million CZK from the city council and the city will also waive its debt. Part of the opposition criticized the municipal leadership today, claiming that the city district was left without the building or the land and lost money.

The construction of the building, which was intended to be the new headquarters for the municipality and included commercial spaces, was approved by the previous leadership of the city district in 2010. At that time, the costs were estimated at more than one billion. However, the previous leadership of Prague 8 halted the construction and subsequently litigated over ownership of the building.

"The settlement agreement should resolve all claims from the involved parties. The fact that this (the problem with completion) will be resolved means that the entire area in Palmovka will be developed comprehensively. Additionally, the city district will have its debt to the city waived and will receive a subsidy. It is not a compromise that I would celebrate, but I believe it is acceptable," said Mayor Ondřej Gros (ODS).

The agreement still needs to be approved by the city councilors and representatives of the capital city, and will then be signed by the involved parties. The leadership of Prague agreed to the process this September, as stated by Mayor Zdeněk Hřib (Pirates) and Councilor Jan Chabr (TOP 09).

The outcome of the negotiations was criticized by some opposition representatives. "These are Lipany, there is no other way to describe it than as a defeat," said opposition representative Tomáš Němeček (8žije). In his opinion, there are several problematic parts of the agreement, including the amount of 142 million that the municipality must pay to the construction company. A similar opinion was expressed by opposition representative Ondřej Buršík (8žije), who stated that the municipality has paid hundreds of millions of crowns and ultimately will not have the building, the money, or the land.

Mayor Gros and Councilor Tomáš Slabihoudek (TOP 09/STAN) stated that Metrostav had sued the municipality, and if the dispute were lost, it would have to pay up to 214 million. "By making concessions, if the agreement becomes effective, Metrostav will withdraw the lawsuits," said Slabihoudek. "We faced a higher payment than the amount in the settlement. Moreover, the municipality will forgive us a debt of 250 million crowns," added Gros.

Němeček also pointed out a lost lawsuit with one of the former interested parties in renting spaces in the New Palmovka building. According to Gros, although this lawsuit did not end favorably for the city district, no further lawsuits are currently pending. "They are barred by limitations. This was the only lawsuit that was initiated on time," he said.