TALLINN - Paul Oberschneider, chairman of the real estate company Ober-Haus, and several joint venture partners have signed a contract for the purchase of over 12 hectares of land in central Tallinn for residential development.
The land belonged to the Marlekor factory, and its sale is being touted as one of the largest real estate deals in Estonia.
"With Estonia at the historic point of having just joined the European Union, large city center land acquisitions like this are unlikely to ever be seen again," said Oberschneider, who has not yet disclosed the price of the deal.
"Estonia's entry into the EU will fuel further foreign direct investment, economic growth, and provide stability and low interest rates," he added. "Add to this a deteriorating housing stock, rising social expectations and immigration to the capital, and you have all the ingredients for strong residential construction growth."
The Marlekor factory currently owns the site between Veerenni and Vana-Louna streets in central Tallinn and houses the production facilities of furniture and plywood manufacturer TVMK. The firm's CFO, Oleg Panfilov, said the company would shut down Tallinn production in 12 to 16 months, after which they would relocate in Kohila some 30 kilometers south of the capital.
Save for the largest production building, 20 hectares of TVMK's land and buildings belong to the Grove Invest company, in which Pyotr Sedin, a large shareholder in TVMK, has a large holding.
Marlekor, which owned TVMK, went bankrupt in April 2000.
