Kharkiv-Moscow accusing Kharkiv mayor of illegal seizure, mayor denies claim, issues rebuttal

Kyiv, October 5 (Interfax-Ukraine) – The director general of the Kharkiv-based Kharkiv-Moscow Firm, Alexander Duker, has accused Kharkiv Mayor Hennadiy Kernes of attempting to illegally seize a site for the construction of the Europe Business Center at 2 Pushkinska Street in Kharkiv, while the mayor says that the investor does not observe its liabilities and that the construction is unsafe.

"I have to announced the possible illegal seizure of a site that was allocated to the Kharkiv-Moscow company with foreign investments. The threat comes from Kharkiv Mayor Kernes, who is using illegal methods and putting pressure on the courts," Duker said at a press conference at Interfax-Ukraine on Tuesday.

According to materials released at the press conference, the gross area of a land plot leased to Kharkiv-Moscow firm for the period until December 1, 2025 is 1.4936 hectares.

Duker said that a criminal case was opened against Kharkiv-Moscow company, nine administrative cases, including a ruling issued by a court of first instance ordering the cancellation of a leasing agreement and a fine of UAH 840,000 for the alleged leasing of a 0.1-hectare area land plot for 24 hours.

The company's director general also said that he had sent several letters to Ukrainian President Viktor Yanukovych and other officials with complaints about the actions of the local authorities. Duker said he'd also sent a letter to SBU Head Volodymyr Khoroshkovsky, as he and his family received phone calls threatening him with arrest if he did not return the site.

He said that according to Ukrainian law, it is impossible to reclaim the land plot. The land plot was leased for 25 years, and the construction was prolonged until 2013, he added.

Duker also said that today the financing of the business center's construction has been suspended. The total investment in the project is assessed at some $300 million ($384 million before the economic crisis).

"We've finished the zero cycle and invested $23.4 million. Today the site has become more favorable for the people who want to take it – the parking area is ready and the frame of the buildings has been erected," he said.

"If there were the political will, and legal decisions from supervision bodies and law-enforcement bodies, we'll build the business center. We're ready to continue building it under personal control of the Ukrainian president. We need 36 months [to build it]," the director said.

Duker said that investors of the projects are two companies and two banks, in particular, from Germany, the United States, Israel and Russia. The names of the companies and banks were not disclosed.

In turn, Kernes told the press that today there is a court ruling on the cancellation of the leasing agreement with Kharkiv-Moscow firm and bringing the territory at 2 Pushkinska Street in Kharkiv into a proper state.

"I'll try to achieve the bringing to order of this territory. We welcome all liabilities of any investor who works in the city of Kharkiv and will help them. However, the liabilities should be observed, especially if this could cause consequences linked to the safety of the public and the city," he said.

He added that three streets were blocked in downtown Kharkiv so Duker could realize the project. Utilities networks were replaced and today they still have to be brought in order.

"We cannot do this, as the state of the pit at 2 Pushkinska Street is causing alarms to specialists. Today the city is bringing about order, and I'm sure that we'll achieve results," Kernes said.

According to the project, the Europe business center of 302,600 square meters will include a five-storey trade and exhibition center of 70,800 square meters, a congress center, a recreation and entertainment center, the House of Representatives (34,300 square meters, 13 floors), the House of Embassies (24,900 square meters, six floors), the House of Banks (15,000 square meters, eight floors), DeLuxe++ class apartments (69,800 square meters, 27 floors), a five-star hotel, a six-level parking area for 2,400 cars (87,000 square meters) and three helipads.

The Kharkiv-Moscow firm ordered the construction of the Europe business center.