Real estate giant Nrep withdraws from the renovation and development of the Lapinlahti hospital area. The reason is money.
Real estate giant Nrep withdraws from the development and renovation of the Lapinlahti hospital area. The reason for withdrawing is money.
According to Nrep, the price of the repair contract for the hospital area is too high. The decision has been made after Nrepi had compared contract offers for repair costs.
Nrep received offers from three contractors. There was an offer for the contract requested from eight companies operating in Finland and specializing in renovation construction.
Repairs the price would be around 35 million euros. If the buildings were repaired in stages, the price would increase by another five million euros.
“They are comparable prices on average. Based on them, we were able to conclude that we are talking about the right costs”, says Nrep's director of project development Juha-Matti Varjonen.
To the area the Lapinlahti Foundation, which represents the current actors, as well as several artists and other influencers are at the beginning of the year campaigned visibly, so that the facilities remain mainly owned by the city of Helsinki.
The city's primary goal has been to form a joint real estate company with Nrep for the renovation of Lapinlahti.
However, public pressure did not affect Nrep's communications manager Jannica Aalton decided to withdraw from the project.
“No, the contract offers revealed too great a risk to make the project financially sustainable,” says Aalto.
No no public job offers. According to Varjonen's assessment, the renovation will be re-tendered in one way or another.
In Nrep, it is estimated that the publication of market data could affect the offers that the city receives. That's why Nrep says it keeps the market information to itself.
Hospital area is clearly in worse condition than expected. This was evident from the fitness tests that came to the public in February. The city had commissioned Afry to conduct fitness tests.
Before the extensive condition report on the condition of the buildings, Nrepi had surveys commissioned by the city in 2007–2008 and a few conducted in the last decade.
“They were years too old. You should always know the current situation, and unfortunately the condition of the buildings has deteriorated,” says Varjonen.
According to Varjonen, the price of repair construction is driven up by the fact that there is still demand for it on the market, even though new construction is slowing due to the depressed economic situation.
Several The present ones of Lapinlahti users and their supporters have hoped for the renovation to be done in stages. However, that would increase the price of the renovation even more.
In recent years, the start of repairs has been delayed by the city of Helsinki's withdrawal from the tender, which Nrep won in 2020.
Now Aalto estimates that if the renovation had started in 2021, the bad condition of the building would have been an even bigger unpleasant surprise than it is now.
Situation is not easy for the city of Helsinki. However, Nrep now clearly wants to say that it is resigning from Lapinlahti.
“We don't want to keep the matter open, because the buildings are in this condition and plans for repairs must be started. The continuation is in the hands of the city”, says Aalto.
Nrep is not even interested in Lapinlahti anymore, even if the city wants to cancel Nrep already due to backing down agreed block area in Kalasatama. Office premises and accommodation are planned for the Koksikortteli.
Koksikortteli and Nrep's commitment to Lapinlahti do not formally exist connected to each other. However, Nrepin Aalto says that the construction was planned for Koksikorttel because no additional construction was planned for Lapinlahti park.
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