Norman construction company bankruptcy. Norman goes bankrupt. Built - forgotten
The top management of the Norman holding should get used to exciting “on the carpet” excursions to the governments of St. Petersburg and the Leningrad region. But, however, they have themselves to blame: in the fall, the company made changes to the design declarations of all seven residential complexes being built in St. Petersburg and the Leningrad region, shifting the construction timeline by at least a year and a half.
The authorities of the 47th region responded to the activists' voice more quickly. At the beginning of February, the initiative group asked Vice-Governor Mikhail Moskvin to arrange a meeting with the company’s management, and at the end of February this meeting took place. The company did not dare to send its newly hired general director Boris Brosalin (in January he replaced the “old-timer” Nikolai Kopytin) to be torn apart by the shareholders, and therefore the chairman of the board of directors of the holding, Viktor Seppenen, came directly to answer.
They started with the positive: the vice-governor solemnly promised that the developer would receive permission to commission the first stage of the Desyatkino residential complex - and the authorities would no longer cancel it. “Public Control” has already written that this permit cost the company 80 million rubles. Let us note that, theoretically, residents may have problems with registration, since the SNiP methods for calculating the areas of the developer at the site diverged from the PIB methods (the designers showed off and did everything exactly according to SNiP and bypassing common sense, the company says). But the authorities of the Leningrad region assure that if Rosreestr has any questions, the construction unit will send an explanatory letter to the department.
Built - forgotten
However, as it turned out, no one in the vice-governor’s office was concerned about the fate of the first stage of the project. Three activist shareholders came to find out from Victor Seppenen: why isn’t a second one being built? “Now the construction is practically at a standstill. The work is simulated - 2-3 people on site. If the developer does 1-2% of the work per week, this is considered very good. In addition, the developer refuses to provide the shareholders with a report form agreed with the company on the work done, that is, those documents by which movement at the construction site could be tracked,” activist Nadezhda Petrova explained to the vice-governor. It should be noted that many shareholders on social networks shared information that for the emergency completion of the first stage, labor was removed from the second.
Now the construction is practically at a standstill. The work is simulated - 2-3 people on site. If the developer does 1-2% of the work per week, this is considered very good.
Another problem is the reinsurance of part of the share participation agreements after the bankruptcy of the insurer IC Sovetskaya. Mr. Seppenen personally promised to bring the DDU under new insurance within 15 days (SK went bankrupt in May 2016), but he never did.
The shareholders described in detail how they were knocking on a closed door: the developer “hid his head in the sand,” did not communicate with the shareholders and avoided meetings scheduled first for December, then for January and February. The only response from Norman, according to shareholders, is the work schedule provided, but it is a priori unfulfillable. “All work, including landscaping, has simply been moved in a broad gesture to the 4th quarter of 2017. And the company plans to issue the keys in a month,” says Ms. Petrova.
Finally, the shareholder’s angry tirade touched on the most important thing - money. The activist complained that the first and second stages have a single account. “Accordingly, the developer handed over the first stage, but, according to our information, there was no money left for the second stage. If the delay in the delivery of the first stage was 9 months, that is, the developer managed to hand over the object without falling into the problem category, then in our case only the official forecast of the developer for the delay is 1.5 years, but in reality it will be much more,” they said shareholders.
Suspecting something was wrong, the shareholders turned to the regional State Tax Service in order to clarify the issue of misuse of funds from the account, and also asked whether the account was divided between the 1st and 2nd stages. But the developer never provided any documents to Gosstroynadzor. The company was fined 100 thousand rubles. “This is a waste of funds that could be used for completion,” say shareholders.
Non-target penalties
The most curious thing is that shareholders called the payment of penalties for residents of the first stage exactly the same inappropriate “wasting” of funds. Now they have more than a hundred lawsuits against Norman LLC in court. According to Ms. Petrova, the developer has already paid more than 700 thousand rubles for these claims. “This is practically a million rubles for nothing - just down the drain. I can tell you about another 40 million rubles of your additional payment, but I won’t, I can go into details for a long time...” - the shareholder easily talks about other people’s money.
The developer was overdue for the first stage of Desyatkino by more than a year: initially they promised to give the keys by the second quarter of 2015.
Let us remind you that the developer was overdue for the delivery of the first stage of Desyatkino by a total of more than a year: initially they promised to give the keys by the second quarter of 2015. And in the spring, the first-stage shareholders began to prepare for massive claims to recover penalties. Citizens were incited by numerous lawyers on social networks who showed photographs of won cases against SPB Renovatsiya, Glavstroy-SPb and other developers. Apparently, half of the amount indicated by the shareholders went to the pioneer Maxim S., who, having won 360 thousand rubles in court against Norman, became an example for other shareholders. In total, there are 872 apartments in the first stage. If they all file lawsuits, the developer will owe about hundreds of millions of rubles.
However, “Normann” is also not the first day on the market. As the shareholders wrote, in court the company’s lawyer tried to fight off the claims, using all possible arguments: bad weather, crisis, bankruptcy of contractors, changes in network design, etc. Apparently, the company is going the same way now. As Ms. Petrova said, the developer is now making attempts to save this money - to reset the account and withdraw assets from the subsidiary. “But I want to note that back in June 2016 I told your previous general director Kopytin: you have two methods to avoid claims. The first is practically legal: quickly build the second stage and bankrupt Norman LLC. And the second is the method of “gray” schemes, which “Norman” has followed now. That is, the withdrawal of funds to other accounts and objects,” thundered the shareholder.
At this point, the vice-governor and top manager were embarrassed: public people know very well what can and cannot be said publicly, and even more so in the presence of the press. “Perhaps you should hire Nadezhda? This is how I described everything...” Mikhail Moskvin joked. “I’m also sitting and thinking about this,” the top manager supported. There was no stopping the shareholders.
At the courts, the company's lawyer tried to fight off the claims, using all possible arguments: bad weather, crisis, bankruptcy of contractors, changes in network design, etc.
“We understand perfectly well that “Normann” has an excellent legal backing; HSE associate professor Ivanov works for him (apparently, this means Anton Ivanov, associate professor at HSE, Honored Lawyer of Russia, awarded the Order of Merit for the Fatherland, III degree ) - there are reserves to stop giving out money,” the shareholder stated, finally proposing to discuss money issues in a “more closed environment.” Apparently, already without the media.
The shareholder ended on a positive note - she asked the regional government to closely address the topic of construction of the second stage of the project and finally discern the fact of fraud on the part of the developer.
Victor Seppenen did not support the tone. “I wanted to talk about the state of affairs at the construction site, but now all desire is gone. If you consider us scammers, then we have nothing to talk about,” said the top manager and forced the activist to take back her words.
But the developer had nothing to report on the substance of the questions raised by the initiative group. Construction work is indeed being carried out at an extremely slow pace and the slowdown process is, alas, manageable. Only on February 27, the holding will unfreeze the contract agreement with the Rost company, which will deal with the roofing and facades at the site. Until now, the contractor could not go to construction because, according to Seppenen, he was “performing feats of labor” at the Zenit Arena. Here we must understand and forgive - it is unlikely that the company went to the construction site of the century on its own initiative. The elevator campaign will be resumed in March.
But to install the engineering, you will have to wait for the change of season: the heating circuit is still not closed, and at subzero temperatures the developer does not want to put a screed on the pipes (horizontal distribution). “We have reached an agreement with the window makers so that they will slowly do the glazing with little effort. I can’t say about the completion date, but they won’t keep the entire construction going,” Victor Seppenen consoled the shareholders and promised to provide a new schedule for the completion of the facility on Monday, March 6.
Norman's bankruptcy is, perhaps, an irreversible process. First they started construction, then they started selling assets, and now they themselves have filed for bankruptcy.
According to experts, 6.2 thousand shareholders are waiting for apartments.
Why am I doing all this?
You can't buy cheap apartments! Well, you can’t, you understand!? And then there is no point in blaming the state that it is to blame for the fact that shareholders were left without apartments and with construction projects frozen.
2015 year. Devyatkino.
Residential complex "Greenlandia". Settl City. Reliable developer. Studio 25m2, price about 1,900,000 rub.
Residential complex "Solnechny". Arsenal. Reliable developer. Studio 25m2, price about 2,100,000 rub.
Residential complex "Colors of Summer". Polis Group. Reliable developer. Studio 24m2, price about 1,800,000 rub. Studio 20m2, price about 1,500,000 rub.
Residential complex "Alphabet". Petrostroy. Reliable developer. Studio 20m2, price about 1,450,000 rub.
Residential complex "Devyatkino". Norman. Studio 28m2, price about 1,500,000 rub.
Why do you think the price for a large studio is so low? Do you think it’s because other developers are greedy and set high prices?
Everything is much simpler. These are huge management failures. Selling a 28m2 studio for 1,500,000 rubles is on the verge of cost. It was easier for Norman not to bother with marketing, not to bother with building a good house, but to simply set very low prices - this would attract buyers. But they forgot that, by the way, they also need to earn money somehow. I sat then and thought, why are they even going to build? Here is the result. No money left.
Dear customers, I beg you, do not be fooled by the very low price. If everyone is more expensive, and someone is very cheap, think about why this is so? If Petrostroy sells 20m2 for 1,400,000 rubles. - This is fine. If Norman sells 28 m2 for 1,500,000 rubles, this is not normal. 28m2 in Devyatkino near the metro should cost at least 2,000,000 rubles.
Agree that it is more profitable to take out an extra 300-400 thousand on a mortgage, but get an apartment on time than to be left broke, am I right?
Buy from reliable developers.
Do you want to choose an apartment? As always, ready to help. Contact:
Shareholders of the problematic Moroshkino residential complex in the Vsevolozhsk district of the Leningrad region have achieved bankruptcy of the developer of the complex - Norman-Zapad LLC. Now they hope that a new investor will complete the work on the site.
According to information from the file of arbitration cases, Norman-Zapad LLC was declared bankrupt and bankruptcy proceedings were opened against it. The corresponding arbitration decision has not yet been published. An application for insolvency of the developer was filed by shareholder Evgeny Filippov, to whom the company owes 1.2 million rubles. The “other persons” involved in the case also include eight shareholders who are counting on the return of money invested in the construction.
As Vitaly Uvakin, a shareholder of the Moroshkino residential complex, told RBC St. Petersburg, this court decision is important for the applicants: “Now we will contact the insurance company, since an insured event has occurred, and we expect that we will soon be included in the register of problem shareholders of the Leningrad region.” “We hope that the authorities will help us find an investor who will complete the work at the site,” said Vitaly Uvakin.
The Chairman of the Board of Directors of the Norman Group of Companies, Viktor Seppenen, did not comment on the situation; the General Director and owner of Norman-Holding LLC, Vladimir Smirnov, did not respond to RBC St. Petersburg’s request.
As Deputy Chairman of the Regional Government Mikhail Moskvin explained, within three months shareholders need to include their data in the register of creditors. “The authorities are ready to provide free legal advice to defrauded shareholders if they encounter legal difficulties. After six months of the competitive supervision procedure, the manager must offer shareholders either to sell the property and divide the money, or to create a housing cooperative to complete the property. If citizens make the second decision, then the regional government will be able to help and find an investor.” According to Mikhail Moskvin, Moroshkino is the most attractive property for potential investors “due to the large number of unsold apartments.”
Residential complex "Moroshkino" is located in the village of Poroshkino, Vsevolozhsk district, Leningrad region. It includes five 12-story monolithic buildings, a kindergarten for 150 children and four closed parking lots. The developer of the property, Norman-West, began construction in 2015 and was supposed to deliver the houses during 2018. However, in three years, the developer built only 30% of the monolithic frame of the first building. Since October 2017, no work has been carried out at the construction site. According to the complex's shareholders, 598 of the 1,068 apartments were sold. A total of 904 million rubles were collected from buyers.
GC "Normann" is building several residential complexes in St. Petersburg and the Leningrad region. Delivery deadlines were missed in three complexes in the city: “Three Oranges”, “On Zarechnaya” and “Izhora Park”. In the region, deadlines were violated for four residential complexes “Normanna”: “Desyatkino 2.0”, the second stage of “Desyatkino”, “Moroshkino” and “Yarky”. In total, more than 6 thousand shareholders of the construction company are waiting to receive their apartments. Due to the current situation, clients of Norman Group of Companies organized rallies and pickets several times.
In addition to the claim against Norman-Zapad LLC, the Arbitration Court of St. Petersburg and the Leningrad Region is considering several more bankruptcy claims filed against other structures of the Norman Group of Companies (“Normann-Holding”, “Normann-Stroy”, “Normann Yug”, “Normann " and "Norman-LO").
This summer, a criminal case was opened against the management of the Norman construction company under Art. 159 of the Criminal Code of the Russian Federation (fraud).
Reference:
Group of Companies "Normann" was founded in 2004. A number of organizations included in its composition perform the functions of a developer, customer, investor and general contractor. According to SPARK-Interfax, Norman-Zapad LLC is part of Norman-Holding LLC, and the 100% owner of the company is Vladimir Smirnov.
Norman has postponed the delivery of its properties for a period of six months to two years and says that honesty today is the best foundation for a developer facing a crisis.
Archive/Interpress
The Norman company has made changes to the design declarations of all seven residential complexes being built in St. Petersburg and the Leningrad region. The delivery of thirteen houses has been postponed. They tried to prepare shareholders for this decision in advance, and the company has more than 6.2 thousand of them. In October, an interview with the chairman of the board of directors of Norman, Viktor Seppenen, appeared on the company’s website, in which the top manager refers to the country’s general economic difficulties: “We are now living in a crisis. I won’t say that this is not the company’s fault, of course, but the crisis has changed the situation very seriously.”
The developer offers apartments at almost the lowest prices in the city. Studios in Yanino are entering the market for 0.9 million rubles. At the same time, the cost of building materials has increased significantly since 2014, and contractors began going bankrupt, Norman explains.
“Many factors influenced the transfer. This is a drop in demand in the market and our excessive optimism when we planned the previous dates,” Viktor Seppenen explained to Fontanka. – This happened in the prosperous years of 2013-2014, and we expected that we would have a little more money than we have now. In 2015, we focused on reducing housing costs without compromising quality and restructuring the company and achieved results in this, but for too long we did not give out plans to the public.”
The company is building three complexes in St. Petersburg. The delivery of the fourth stage of the Izhora Park residential complex in Metallostroy has already been delayed for a year; now the shareholders have been promised apartments in August 2017. The already delayed completion of the second stage of “Three Oranges” on Parnassus has been postponed again - to December next year. But the least fortunate were the buyers of apartments in the third stage of the Na Zarechnaya residential complex, which is being built there, on Parnas. Instead of 2017, the complex is promised to be completed in 2019, although the average construction period for a house on the market is 1.5-2 years.
From the beginning of November, Norman's shareholders began asking for meetings with top management. The company assures that the deadlines were postponed “with reserve” in order to meet them exactly, say buyers of apartments in the residential complex “On Zarechnaya” and explain their distrust by the fact that new construction schedules were not provided, and they promised to compensate for the delay with certificates for free property registration.
“Our house is 90% ready, all the apartments were sold a long time ago, but construction is actually not underway,” one of the shareholders of the first stage of the residential complex “On Zarechnaya” told Fontanka. “We were not told any specifics when active work would begin at the meeting; they only assured us that the house would be completed on a new date, with a delay of 10 months.”
Buyers of the Yarkiy residential complex in Yanino contacted the prosecutor's office. Since the beginning of last year, the company has built only 1.5 floors in the houses of the first stage and has already postponed their completion to 2018. Moreover, 100% of the apartments in the two buildings are budget one-room apartments and studios.
Buyers of apartments in the Moroshkino residential complex, not far from Yukki, found themselves in a similar situation. The company promised to deliver the first thousand-apartment building at the beginning of 2017. But by November of this year I had only reached the second floor. The delivery was immediately postponed for 1.5 years - to July 2018.
Shareholders are thinking about terminating the contract with the developer, but the decision is difficult to make. According to the agreement, Norman has the right to withhold 10% of the cost of an already inexpensive apartment. As a result, after months and even years of waiting for their own home, buyers will receive money that is barely enough for new square meters.
The company explains that they offer more options. “After the acceptance certificate, people will be able to demand late fees in the prescribed manner. For those who are not ready to wait, we offer to reassign the apartment, move to another queue or terminate the agreement,” says Victor Seppenen. “This is how we previously worked with investors who bought apartments from us for further resale, and we have worked out such a mechanism.”
“We could have waited until the last minute to postpone the deadline and offered to wait another six months. And another six months. And then there’s just a little bit left,” adds the chairman of the board of directors. “But in order to maintain trust between the company and shareholders, we considered it necessary to announce new realistic and absolutely achievable deadlines. In the short term, this is an unprofitable step for us, but losing trust in the developer is much more dangerous in the long term.”
The government of the Leningrad region is aware of the company's problems. “We are recording a delay in the delivery of facilities to the Norman company. In particular, in the Yarkiy residential complex in Yanino. Shareholders have repeatedly sent appeals to the State Construction Supervision Committee of the Leningrad Region, but no one has yet addressed me,” said the region’s vice-governor Mikhail Moskvin through the press service.
Officially, government agencies consider the facility to be a long-term construction project, and the shareholders are deceived only if there is a 9-month delay in handing over the keys. So far, the administration has no reason to control construction. “In general, the company is making contact, correcting the comments of Gosstroynadzor, construction continues, albeit at a slow pace,” says Mikhail Moskvin. – As for missing deadlines, according to the City Code, the time for delivery of objects is determined by the developer himself, based on financial and technical capabilities. The state does not have the authority to force it to reduce the delivery time for objects.”
The St. Petersburg Construction Committee is in solidarity with its neighbors. The company's properties are not on the list of problematic ones, and the developer is not on the register of defrauded shareholders. In addition, this year the company is commissioning queues in Izhora Park, Moroshkino and Three Oranges.
Moreover, the company continues to attract new shareholders. In October - November of this year, Norman opened sales in the new phases of the Moroshkino and Yarky residential complexes in the Leningrad region; their construction has not yet begun. “We expect average annual growth of [the company] by 10-15 percent, maybe 20, but no more,” says Victor Seppenen in an official interview. – In order to continue this business, it is necessary to start new construction projects. We have a certain land bank, and now we are acquiring additional land plots, taking into account the geography of the facilities built and under construction.”
Norman assures that bankruptcy is out of the question, citing its 12-year history. The company was founded in 2004 by Vladimir Smirnov, Yuri Rafalsky and Igor Vitkovsky.
In the 2000s, Rafalsky and Vitkovsky actively developed a business in the production of building materials and contracting work. Their holding, North-Western Nonmetallic Company, included about 20 enterprises for the extraction of sand and crushed stone, the Taxi-Concrete company and ISG Norman. However, in the late 2000s, Yuri joined United Russia, and Igor Vitkovsky focused on his company Intra Tool. "Norman" came under the control of Vladimir Smirnov.
The active development of Norman's development business coincided with the acquisition of Rostov-based Donkhlebbank in 2013, which today is Norman's main partner in issuing mortgages. According to official reports, 59% of the structure belongs to Vladimir Smirnov, almost 31% to the president of ISG Norman Valery Shemrakov, another 10% is distributed among minority shareholders.
According to the Central Bank, in the first half of this year, Donkhlebbank's net income decreased by half - from 160 to 83 million rubles, and the bank received almost 60 million rubles in losses.
In addition, in October, the property relations committee filed a lawsuit against the Norman Yug company, which was building Izhora Park in Metallostroy. Smolny missed 24 million rubles in rent payments.
The last time the LEK company announced a delay in the commissioning of all projects was in 2008. The reason was the conflict between business owners - Andrei Rogachev and Pavel Andreev. The heir to the developer "L1" is still completing projects from the 2000s. However, since then the developer has not brought new properties to the market, and has also used funds from the sale of the land bank accumulated in the fat 2000s to complete the construction of complexes.
Shareholders of the Norman Group of Companies, officials and company executives met at the administration of the Leningrad region.
Deputy Chairman of the Government of the Leningrad Region Mikhail Moskvin said that the regional authorities, together with their St. Petersburg colleagues, conducted an audit of Norman’s assets. It turned out that the company's debt is 15 billion rubles, the cash gap is about 1 billion. The main reason for the financial troubles is the high costs of maintaining the customer service. Mr. Moskvin turned to the present owner of Norman, Vladimir Smirnov, with a request to provide additional information on the company’s assets.
Representatives of the prosecutor's office reported that the day before, on June 21, a criminal case was opened under Article 159 of the Criminal Code of the Russian Federation (fraud), but did not answer additional questions.
The authorities of the Leningrad region freed Norman from the need to build social infrastructure. In addition, officials take part in negotiations with potential investors and banks. The situation was discussed with Sberbank and with the managers of the construction company Liga Stroy. According to Mikhail Moskvin, it is easier to sell assets within the framework of bankruptcy.
Vladimir Smirnov does not like the prospect of bankruptcy; he hopes to get a life-saving sum by realizing the right to develop the Normandy residential complex. Let us remind you that Norman recently received permission to build another house in this complex. “This was done precisely in order to sell the asset,” explained Mr. Smirnov. He also expects to find an investor for the third stage of the Yarky residential complex and for two projects in St. Petersburg: the construction of an apart-hotel on Tovarishchesky Prospekt and a residential building on Evgeniy Shvarts Alley in Ruchi. “Sell your cars, apartments... kidneys,” suggested shareholders. A representative of the prosecutor's office said that attracting personal funds from the company's owners is not yet possible.
According to Mr. Smirnov, in the near future “Normann” will complete the facilities at the high readiness stage.