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Friday 20.01.2017 | Name days: Aļģirds, Orests, Oļģerts, Alģis

Alliance: real estate projects in Latvia take ten times longer to coordinate than in Lithuania

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RULithuanian institutions responsible for coordinating real estate projects have a modern system in place that allows them to coordinate projects within one month’s time. In Latvia, on the other hand, real estate coordination process can take from four to eighteen months.

«Disorder and excessive bureaucracy in this field only contributes to continued non-competitiveness of Riga in terms of attracting investments, which causes the capital to lose millions worth of investments every year,» – believes Guntars Grinvalds, board member of the newly-formed National Real Estate Developers Alliance.

The alliance notes that Latvia should look up to Lithuania for a successful and efficient project review system. It is worth starting with a creation of an electronic environment that would help developers submit their project’s electronically and then communicate with responsible institutions and follow the coordination process.

«The project coordination process in Latvia does not comply with modern approach. It’s more of a thing from the past in comparison with other EU member states. Communication between institutions and developers is overburdened with bureaucracy and unnecessary complexity. All it does is lengthen the coordination process. Developers have to submit their projects ion person to the coordinating institutions, and the latter do not communicate amongst themselves during the entire process. Lithuania’s modern approach is much more effective – documents are submitted electronically and are automatically registered in all related institutions. All notes from each institution are added digitally, which allows developers to follow the coordination process more closely, add changes where needed and submit additional documents. In Latvia, on the other hand, convenience is replaces with traditional post, where each decision is documented as an administrative act (taking up to 30 days and retaining the option to extend the response period for additional 4 months),» – explains Grinvalds.

This excessively bureaucratic approach costs Riga and the country dozens of million euros in lost investments annually. In order to make Riga more competitive in the field of real estate projects and be able to attract foreign investments on par with Estonia and Lithuania, the model should be made more streamlined and the process should take no more than six months after initial submission of the project, says the expert.

«There are multiple requirements that are pointless and inconsequential to the final result. The coordination process for new construction projects often lasts years. It is one of the main reasons that pull investors away from investing in new projects in Riga, forcing them to choose instead other Baltic States. Millions worth of investments go past Riga and Latvia as a result,» – adds Grinvalds.

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