Kazakhstan: Astana to Make Offers for Properties that Construction Companies Shouldn't Refuse

The head of Kazakhstan's Samruk-Kazyna national welfare fund, Kairat Kelimbetov, has announced that if hard-pressed construction companies do not participate in a state-organized real estate buy-back scheme, the government may initiate action to take over desired properties.

The Kazakh construction sector has been hit hard by the global economic downturn with scores of building sites closed and half built apartment blocks littering the skylines of cities, including Astana and Almaty. The state allocated roughly $4.5 billion in assistance to the ailing sector in 2007 and 2008, and now officials are looking to recoup at least a portion of that outlay. Samruk-Kazyna has offered to buy up unfinished real estate at the fixed price of about $637 per square meter in Astana, and $796 per square meter in Almaty, Gazeta.kz reported March 2.

"The law will be passed within a year. We will come to you -- the State, the fund Samruk-Kazyna -- the operator, and we will be bankrupting you, taking away these houses and completing their construction," said fund chairman Kairat Kelimbetov.