Legal norms at the commercial real estate market: draft bill
The real estate market in Russia is not perfect. Some processes are not regulated here, which complicates the development of the segment. That is why experts decided to create their own code of owners and tenants, which will simplify and formalize the relations between the parties to the agreement. According to experts, legal norms in the commercial real estate market are necessary, and developers, builders and users of objects are involved in their development.
One of the factors behind the creation of such a code was the situation related to the discussion of the draft bill, which allows for unilateral termination of lease agreements. So far the government has not come to an unequivocal decision and postponed the consideration of the document for a week. The purpose of this law is to minimize the negative consequences of the coronavirus pandemic, as well as to provide a basis for development of the segment. The point of agreement termination raises the greatest number of questions. According to the document, tenants may do it unilaterally, and no additional compensation will be charged, and the owner of the real estate must return the security payment. That is why many developers and management companies decided to join forces to develop together a set of rules that would help regulate the relations between the parties to the agreement in a way that would be convenient for all parties.
The experts took as a basis the experience of the Netherlands, where such a code is fully functional. Banks, state authorities, property owners and tenants took part in its creation. All of them expressed their vision of processes in the market, their solution of conflict situations and their reasons. The result is a document that takes into account the interests of all market participants and gives answers to the most difficult questions. Unfortunately, there is no such dialogue in Russia, which causes difficulties and impedes market development. In order to unite professionals, a conference was recently held. Representatives of various companies shared their vision of what a code should include, what legal norms in the segment are imperfect and what needs to be done to make them work.
It is worth mentioning the bill, which served as a basis for the creation of new legal norms. At the regular meeting, the Russian government presented a document aimed at maintaining business, which was affected by the coronavirus pandemic. According to it, companies that have lost 50% or more of their total income have the right to unilaterally terminate the lease agreement. At the same time, they are not threatened with penalties.
This bill caused a heated discussion among market representatives. Developers, management companies, owners of commercial real estate were against such permission. According to them, such regulations will not allow building transparent relations between market players and will hamper the development of the segment. Besides, the situation with commercial real estate is complicated now, and such a law may lead to critical consequences.