Developers and activists: is a constructive dialog possible in changing cities?
Amidst the active development of Ukrainian cities, the need for restoration and revitalization, tensions often arise between developers and the community. As part of the discussions at the Forbes Development: The Foundation of Success" forum, the participants discussed why this happens and whether it is possible to find a common language.
Dmytro Perov, a monument conservationist and urbanist, emphasized that:
"The city belongs to everyone - citizens, developers, and tram drivers. It is a complex urban ecosystem where political, financial, and vital interests intersect. And it is important to find a balance..."
He also added that it is important to involve urbanists, analysts of the urban environment who can foresee potential conflicts at the planning stage. He also advised to engage in proactive communication.
Igor Raikov, a developer and market participant, emphasized that responsibility should be shared:
"In general, in the actions of an active community, there is often a hint that developers are always dishonest people who are trying to destroy some cultural heritage or build up some protected areas. But usually, a developer is just an entrepreneur. Entrepreneurs create added value. And an entrepreneur starts acting when he has permits. But why is there no city government in this system, which should be a referee between the interests of business and the community? For some reason, city authorities always hide somewhere in such conflicts."
The panel "Indifferent or Irreconcilable" also discussed how to involve urbanists in development projects so that it does not "kill" the project's economy and does not overstate the cost. Dmytro Perov noted that urban planners could conduct a survey of citizens to find out what kind of facility they would like to see in this particular location. However, according to Raikov, this approach is ineffective, because the responsibility and risks lie with the entrepreneur. Usually, it is the owner of the asset who determines its functionality and develops the business model.
As an example of the conflict between real estate investors and active citizens, the case of Flowers of Ukraine was cited, a building that was purchased by a private owner, a development project began, but the work was stopped due to protests at some point. The building is still abandoned.
Revitalization as a litmus test
The discussion also touched on the difficulties of revitalizing old industrial or cultural facilities in large cities. Entrepreneurs complain that:
- the process is unprofitable, often even unprofitable (restoration is always more expensive than building from scratch);
- laws do not allow for flexible adaptation of historical and cultural monuments to modern functions;
- Any changes could provoke a conflict with the communities.
For example, A Station in Kyiv, Lem Station, and Jam Factory in Lviv were named as examples of successful projects to restore historic buildings. But such cases are the exception rather than the rule. Revitalizing historic areas in cities is a complex process. Often, protest actions take place without prior discussion or analysis, and this creates risks for all parties, including the city. Richert & Park was named as a potential case that did not work out.
Oleksiy Baranov, founder of A Development, shared that:
"Investments in A Station amounted to more than $100 million. There are two national monuments and four local ones on the territory. We also have 10 criminal cases against us, of which only two are active."
Igor Nikonov, founder of KAN Development, also spoke about the difficulty of building in Ukraine. Unresolved legislation and insufficient protection of property rights discourage foreign investors from investing in projects here, and that is why there are still no major international developers in Ukraine.
"If an investor has lost money due to loopholes in the law, someone has to compensate for these costs. Not many people today believe in Ukraine, let's just say. And even fewer people are willing to invest here. Therefore, there should be significant support for investment projects."
Valeriia Kolomiets, Director of Conservation and Restoration Initiatives, WWF-Ukraine, noted that:
"Recently, a law was passed to help protect land ownership rights. This law helps developers [...] However, the city should bring both economic and social benefits. People want to breathe fresh air and walk with their children in the park. So we have to find a balance. This situation with the law and the petition has brought the expert community to the opportunity to build a dialog with business. Everyone lobbies for their own interests, but maybe we can do it together in some ways."
Position of the government and city authorities
Oleksandr Novytskyi, Chairman of the DIAA, at the panel on public-private partnerships through the eyes of the state, noted that the organization is doing its best to demonstrate openness and promote cooperation with business at several levels, from advisory to regulatory. And that there are currently more than 200 projects involving the state and private companies.
The forum was attended by two mayors from Lviv and Mykolaiv. They were not part of the panel with architects or urbanists, but spoke about the problems and focuses of the cities. Andriy Sadovyi said, "Currently, the first priority of Lviv is exclusively the military, and more than 2 billion hryvnias have been allocated from the city budget for this purpose."
Oleksandr Sienkevych, Mayor of Mykolaiv, said that the city's priority is to rebuild. "We want to build without looking back at the past, but using our best practices: industrial heritage and the area by the sea. Unfortunately, Mykolaiv is closer to the frontline, which does not add to our advantages." Oleksandr also noted that the city's stakes in business will be high and the search for tools that would help make an economic breakthrough is ongoing. The city authorities are ready and interested in working more closely with private entrepreneurs.
