The construction of Nová Karolina in Ostrava could continue

Ostrava - Ostrava's New Karolina, one of the largest urban development projects in the Czech Republic, will likely continue from the beginning of 2010. Work on the site, which is supposed to become a new part of the city center, was halted about a year ago due to the economic crisis. The company Multi Development, which won the competition to develop the former coke plant, is now completing negotiations with banks and should be able to secure funding for the first phase, said deputy mayor Lukáš Ženatý (ODS) to reporters today. According to the plan, costs are expected to reach around 15 billion crowns.
    Ostrava city councilors decided at their meeting today to postpone the construction schedule for the individual phases by two years at the request of the company. The completion of the first phase, which includes among other things a commercial and entertainment center, an apartment building, and an administrative complex, was originally planned for 2010. The entire New Karolina, which is divided into four phases, was expected to be completed in 2016, so the overall completion is now pushed to 2018.
    "By the end of this year, if everything goes as promised, they (Multi Development) will have a signed loan agreement," Ženatý stated, adding that the costs for building the first phase are about eight billion.
    Multi Development had agreed before the complete halt of work to cooperate with Passerinvest Group on the construction of the administrative part of the first phase of New Karolina. However, work on the construction was eventually halted completely. According to Ženatý, Multi Development remains responsible for this part of the project, as it is the contractual partner of the city. Therefore, the first phase of the project is to be completed according to the contract, including the administrative complex, and it is up to the company how it resolves this.
    Multi Development faced sanctions in the form of returning part of the land for not adhering to the construction schedule. However, the city does not want to penalize the company for now and is rather trying to accommodate it by postponing the schedule. They believe that the project will be completed and also think that the halt in works could not be influenced by the crisis. "Several hundred million crowns have been invested in this. There are more than 40 building permits, and there are tens of millions in projects," Ženatý stated. If the company manages to secure funds, according to the deputy, it would be the only extensive loan that a developer would obtain in the Czech Republic this year.
    Nevertheless, the city has ensured itself. Although the council approved the postponement of the schedule today, this amendment to the contract will only be signed when Multi Development presents the loan agreement to the city.
    New Karolina is to be built on a 32-hectare area, making it more than seven times larger than Prague's Wenceslas Square. A total of 97,000 square meters of retail space, 67,000 square meters of offices, and 78,000 square meters for residential purposes are to be created. The area will also feature 3,500 parking spaces. The last buildings of the former Karolina coke plant were demolished about 20 years ago, and the site had to be decontaminated for ten years.