Business
Russian building downturn leaves Moscow apartment buyers in limbo
Russian building downturn leaves Moscow apartment buyers in limbo
About this update from Samolet
By Nika KhutsievaPlastic sheets flap in empty windows and balconies hang askew at part of outer Moscow's unfinished Ostafyevo housing complex, where disgruntled homebuyers say they are suing its developer.Fuelled by state-backed mortgages, a record volume of housing was built across Russia in 2023, but a rollback of subsidies and high borrowing costs have since hit builders in a broader economic slowdown as war with Ukraine drags on.The amount of residential space completed slumped 28% year-on-year in the first quarter, data from the state statistics service shows, while Russia's largest lender Sberbank warned that the whole construction sector had stagnated in the period.Some buyers of Ostafyevo apartments said they had seen move-in deadlines slip multiple times since March 2025 and a group of around 20 confronted developer Samolet at a meeting in May."Who is working there? Are they even working? Because ... we have not seen any changes since January," one buyer said.Another showed Reuters video shot inside one of the half-built apartments, where wiring hung from walls of bare breeze block and a large patch of damp spread from the ceiling.Samolet said in a written response to a request for comment that it understood the group's concern and was "making every possible effort" to expedite move-ins.It did not say what had caused the delays, but said a number of contractors had been replaced with "reliable partners".With a video of children swinging in a sunlit playground, Ostafyevo's website promises to deliver a sprawling complex of landscaped apartment blocks with schools and shops. Units start at around 7.5 million roubles ($101,500).Samolet said construction was complete on three of six phases, with buyers already in residence. Apartments in the fourth phase and some in the fifth are ready for move-in and a gradual handover of the rest will start by September 30."All obligations to clients will be fulfilled," it said.The finances of the firm, one of Russia's largest developers, reflect pressures facing the wider sector. After rapid revenue growth in 2023-24, high borrowing costs contributed to Samolet reporting a loss in 2025. Denied state subsidies, it refinanced part of its debt load in February.As of end-2025, its broader debt exposure stood at 373 billion roubles ($5 billion), the latest available data shows.The building downturn is set to further dr...