International Property News

Orco sees starting 3 bln euro project in 2010

24th June 2008

Orco Property Group expects to start building its 3 billion euro ($4.66 billion) downtown Prague development project in 2010, Vice-President Ales Vobruba said on Tuesday.

Orco bought 27 hectares at the Bubny railway station in the Czech capital for 1.1 billion crowns ($70.77 million) in 2006.

The real estate firm plans to rebuild the area into 1.2 million square metres of offices, flats and retail space. The project should include a hospital, kindergarten and possibly a university campus.

"We will be glad if we manage to change the zoning plan by 2010 and only after that we can start the first phase," Vobruba said.

He said Orco would split the project into 25 or 30 parts and finance each of them separately. Vobruba said it was too early to give any details.

Orco shares have slumped by 60 percent over the past year to Tuesday's all-time low of 850 crowns, following a credit crunch in the United States, which cast doubts on financing of the firm's fast expansion in central and eastern Europe.

Vobruba said completion of Bubny project would depend on the actual situation on the real-estate market.

"At the moment we have the target of 2018," he said.

Source: Reuters