Most of the land plots in the city of Moscow are owned by the city, so business entities have to deal with state authorities in the process of exercising the right to receive land plots from the city. In this article, we will tell you who has the right to conclude a land lease agreement and how to exercise this right.
Under the Resolutions of the Government of Moscow #99-PP of February 20, 2013, and #199-PP of May 15, 2012 “On Approval of the administrative regulations for the provision of public services by the Moscow City Property Department” (hereinafter referred to as the Administrative Regulations), one of the tasks of the Department is to perform the powers of the owner in relation to the land and property of the city of Moscow.
The legislation provides for two ways to conclude a lease agreement on state and municipal property. A person wishing to purchase a lease right enters into a contract according to the standard procedure in the event of a tender. If the lessee is the owner of the capital construction objects located on the land plot, the auction is not held. It is worth paying attention to the essential terms of the lease agreement, without which it can be considered not concluded.
How long can the procedure take?
The Administrative Regulations strictly regulate the timing of implementation of the procedure for concluding a land lease agreement. Registration of a land lease agreement usually takes no more than 25 working days, but it is necessary to take into account the specifics of each situation. For example, if necessary, the Moscow City Property Department sends a request to the State Inspectorate for Control over the Use of Real Estate Objects of the City of Moscow to obtain information about the presence/absence of objects of unauthorized construction on the land plot, which leads to an increase in the service delivery period.
What risks should be considered when signing a lease agreement?
The rent of urban land in Moscow has its peculiarities. When signing a lease agreement, it is necessary to consider the rent calculation (if the rent is overstated, it may be reduced by challenging the cadastral value https://en.reasons-law.ru/services/osparivanie-kadastrovoj-stoimosti/), limited opportunities for construction/reconstruction. Typical risks on the territory of the city are:
- introduction of changes in the Rules of land use and development of the city of Moscow, the establishment of the “F” index, which leads to the impossibility of changing the type of
- permitted use of the land plot and construction exceeding the area of the existing building (to solve this problem, it is necessary to perform an urban planning audit and apply to Urban Planning and Land Commission with a request to introduce amendments to the Land Use and Development Rules).
- the risk of attributing the capital construction object to the objects of unauthorized construction and its inclusion in Appendix #2 819-PP;
- the risk of early termination of the lease agreement unilaterally on the grounds provided for in the lease agreement, but not provided for by law, and sometimes contrary to them;
- the risk of withdrawal of the land plot for the needs of the city.
What can be the grounds for refusal:
In accordance with clause 2.10.1. of the Decree of the Government of Moscow of 15.05.2012 #199-PP (version of 26.09.2017) “On approval of administrative regulations for the provision of public services by the Moscow City Property Department,” the grounds for a refusal to conclude a lease agreement with the Moscow City Property Department are:
- recognition of a real estate object as an unauthorized construction;
- unauthorized reconstruction of the building (illegally erected floors, extensions, and superstructures, changing the height of the floors, deepening the basement, the construction of a vestibule with an area of more than 15 meters);
- the use of the object for other purposes, the lack of economic activity in the premises, the lack of access to the premises to the representative of the owner to conduct its inspection;
- use of the land plot for purposes that do not correspond to the permitted type of use. In other words, the use of the land plot not for its intended purpose or in such ways and methods
- that lead to a significant decrease in the fertility of agricultural land or cause damage to the environment or damage to the land;
- the expiration of the period of suspension of the provision of public services, if the reasons that became the basis for the suspension of the provision of public services were not eliminated during this period;
- other reasons specified in clause 2.10.1. of the Decree of the Government of Moscow of 15.05.2012 #199-PP.
To minimize the risks, the Reasons Law Firm experts are ready to conduct a legal analysis of your situation and fully accompany the process of concluding a land lease agreement.
