Current tenant of the Odesavinprom Unified Property Complex agreed to pay 2.2 times more for rent, taking advantage of the pre-emptive right to extend the contract at an online auction

On April 5, 2021, the Regional Office of the State Property Fund of Ukraine in Odesa and Mykolaiv oblasts approved the Protocol of the Auction for the extension of the lease agreement for the Odesavinprom Unified Property Complex (UPC). The e-Auction was held on March 31, 2021.

Starting price of lease of the Unified Property Complex at the auction was UAH 339,550.48 and was equivalent of the rent, paid by the current tenant for the last month of the lease under the contract that continued at the auction.

The lease has been extended by 6 months.

Two participants took part in the auction: current tenant – Odesavinprom PJSC and Industrial and Construction Group “ETALON-BUD” LLC.

The second company won the auction. Its price offer was UAH 751,347. The operational activities of Industrial and Construction Group “ETALON-BUD” LLC are not related with the production of wine, but this company is an active participant in the market for the construction of residential buildings in Odesa.

According to the law, the current tenant of Odesavinprom PrJSC has the pre-emptive right to extend the contract. Within the period established by the law (3 working days from the date of the auction), the extension of the current agreement at a new price equivalent to the final proposal at the auction winner was agreed.

Consequently, the rental rate for Odesavinprom PrJSC will increase by 2.2 times as a result of the auction.

At the same time, before concluding a new lease agreement, the current tenant must also pay the following payments within 20 days:

advance payment in the amount of rent for 2 months (excluding VAT, since the lease of unified property complexes is exempt from VAT);

security deposit in the amount of 2 months rent (also without VAT).

In total, more than UAH 3 million.