Video: Wartime Real Estate Privatizations in Ukraine
The tens of billions of dollars and euros being sent by Western taxpayers are not enough.
Ukraine needs more cash.
So it is privatizing thousands of properties all over the country.
Unlike past privatizations which were notoriously corrupt, this wave of privatizations is extremely transparent, is done online, is open to non citizens, and even has an English website.
In this video, my Ukrainian lawyer Taras explains the process and how people can participate. Both foreign individuals and entities are welcome to take part.
To be extremely clear, this video is not an invitation to invest.
As a full-time investor, I am always monitoring markets around the world for unique opportunities. It’s part of my process.
To be extremely clear, this video is not an invitation to invest.
🇺🇦 English Privatization website: https://privatization.gov.ua/en/
🇺🇦 Ukrainian Privatization website: https://prozorro.sale/
As a full-time investor, I am always monitoring markets around the world for unique opportunities. It’s part of my process.
Ukraine is extending expired residency cards
Taras shared some good news with me, he told me that the Ukrainian government decided to automatically renew foreigners’ residencies that expired since the conflict started. This offer is valid for as long as there is martial law in Ukraine. All you need to do is to go to any Ukrainian city to renew it, not necessarily the city of your registration.
As a resident of Ukraine, I welcome the easier procedure.
Having said this, I am in no rush to go back as long as the situation continues to escalate.
Prayers for the civilians, soldiers, families of soldiers, wounded, and deceased on both sides. And may the wrath of God punish the Warmongers.
The Wandering Investor
If you want to read more such articles on other real estate markets in the world, go to the bottom of my International Real Estate Services page.
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Full transcript of “The Ukrainian Government is Privatizing Real Estate all over the Country”
LADISLAS MAURICE: Hello, everyone. Ladislas Maurice from thewanderinginvestor.com. And today, I’m with Taras, my lawyer in Ukraine. How are you, Taras?
TARAS: I’m fine, thank you, Ladislas. And how are you?
LADISLAS MAURICE: Good. Good, good. So Taras has helped me obtain residency in Ukraine, he’s helped me with a lot of other paperwork in Ukraine. And today, he wants to show us an opportunity that is showing up in the sphere of government privatizations in Ukraine. So the government clearly has money issues in Ukraine, and they’re looking to raise money. So what they’re doing is they’re selling a whole bunch of state assets. And there’s apparently a very transparent bidding process even for smaller properties. So I’ll let Taras elaborate a little bit on this.
TARAS: Yeah, yeah, sure. It’s basically what you said, we have this idea of whole new type of privatization or for sale government properties in the form of auction that are done online without any kind of corruption or any stuff. So what they do, they just offer for bidding individuals, companies, and what is also good that they allow to do it for foreigners. So the whole new law was changed this summer. And actually, it started in August, I guess, this new type of simplified way how to do it. Of course, it still needs some paperwork to do. But it makes, in this situation, what we have now, less offers and some prices that really can be attractive.
Again, it’s not the type of real estate that you would go and buy, like residential one, it’s a bit more complex. You either need to invest a lot to have this flipped or to find some other value. But still, it’s maybe good period to find risky asset but still that makes some good profits.
LADISLAS MAURICE: Yeah. So what we’re going to be showing here is absolutely not risk free. We’ll discuss this but essentially from a legal point of view, like you say, it’s very transparent, not corrupt, which is new for Ukraine. Because before, Ukraine was known for extremely corrupt privatizations. But the fact that they’re now moving online and doing all this in a transparent way is a very positive step.
TARAS: Yeah, I would also add that even they did it in English, as you see, I shared my screen, so it’s like State Property Fund page. You can go by privatization.gov.ua and find everything is online. And you go with small privatizations. This is a type of what we are saying about, is like the special procedure during martial law period. And you can find really good big quality stuff. Mostly, in this website, you would see value offers that are higher in value from the starting price. But also you can find in not English version web page, it’s called like Prozorro, objects that valued in a smaller price.
So if you go with some examples that what we had, like it was recreation base in Carpathian Mountains, really pretty spot. Mostly, what you buy here, usually not the real estate that is already in operation or what you see in picture, you’re buying place or object, usually land. So it was offered for 37,000 hryvnias and end up with 5 million. Of course, it was advertised very much. And that’s why its price went so high. But if you go for–
LADISLAS MAURICE: So the currency is about 40 hryvnias to the dollar, so roughly the starting price was $1,000 for this whole plot of land.
TARAS: Yeah. Land was very good because even in this page of privatization, you can see that it’s near a river, it’s near main road, right way in mountains, like two hours right from Lviv, or Uzhhorod both sides. So it’s really, really nice site. And that’s why competition was higher. And it was advertised, as it says, very much in media because it was very first stages of this privatization, so they wanted to show how it can be done. And what we hope to see further, objects that would not be so much advertised but still would have this– And I’m like sure that it’s like a ton of these assets that are like just waiting and they’re never used. But we can still find them.
LADISLAS MAURICE: Because we were talking, it’s like former factories or pharmacies in small towns or in big cities, it’s just like literally everything.
TARAS: Yeah.
LADISLAS MAURICE: There is like random buildings and plots of land all over the country that are being sold this way.
TARAS: I even seen the plane that is advertised there. [laughs]
TARAS: Yeah. So the second example was a similar way but near seaside, Black Sea. Also recreation base. It was offered for 6 million and nobody came to offer because for offering you need to pay deposit, and it’s like 10%, usually, from the price. So here, they are offering this for 3 million now. And I still don’t know if it has this value of 3 million or not. But one of objects that you can be like have this understanding what you can find in the stuff. So formally and legally, you need to go through three ways.
First, you need to register on the trading webpage. And unfortunately, they are not translated as this one state-owned in English. Usually, it will be in Ukrainian, so you need to find someone that would help. So we can do it. Then you need to upload very simple three papers about that you are not Russian, you have your source of income, and you would guarantee that when you do this bidding, you would agree for the price, otherwise, you would pay some fine. And third, what you also need to be sure that what you’re buying from the state is what you want or what you see. So in this example of this 3 million, when you’re buying 5,000 square meters in buildings that really cannot be usable, you are aiming to get two hectares of land right across the sea. So it’s like seaside land.
But still, even in this ad that on public page, you see that it’s court decision that has this 2,000 square meters. But in fact, the plot is not registered. And that’s why this may be a red flag for most investors that never came even for the first auction. That’s why you need to have, still, somebody to check. But a part of it, it’s really, really interesting stuff. You can see in Kyiv, even I shown also some objects that are, for example, like bad building, but still it’s like few meters from Metro Station, and it’s like city that can be very good to have the space. Also, shopping street, not very good object but it’s like, again, you have right in the heart of the city some real estate. So now at last, to sum up, really cool stuff to check. You can check it by yourself.
LADISLAS MAURICE: Cool stuff. A lot of crap, but some cool stuff.
TARAS: Right. Yeah. This is true, you need to find this really value here.
LADISLAS MAURICE: Okay, cool. Thank you, Taras. So this is very, very interesting. So essentially, people can go directly themselves onto the English website, kind of browse through all the properties. But you were saying it’s more the more expensive properties that are marketed on the English website. If people want to have all the kind of cheap stuff, they should go to the Ukrainian website as well. So people should really be looking at both. So essentially, people can do that on their own, if they want to put a bid, you can help with the paperwork and do the due diligence on the actual properties.
TARAS: And closing of the deal is also important. It’s not obligatory to go if you have somebody that is authorized by a power of attorney to have this deal done. Because after you bid, and even win, you have a period of months to pay, and then, additionally, a month or two to close it to sign. So you have enough time to be sure that you would send, for example, power of attorney and then somebody would go and sign all papers on [?your behalf].
LADISLAS MAURICE: Okay. Cool. Fantastic. Thank you very much, Taras. This was very interesting. So again, people, look at whether you want to invest in Ukraine or not right now, obviously, it’s risky. It’s for people that have, I’d say, a lot of money and that are willing to just speculate on some very high risk stuff. But there’s this really new system, which is transparent, which shows that some things are improving in Ukraine. Also, Taras, people are still getting residency in Ukraine, right? So a lot of people are asking me, “Oh, can I still go visit, etc.?” Like even tourists–
TARAS: Yeah. Even new law, like two weeks ago, was issued that if you had residency that was expired during the martial period, like war time period, you would have possibility to come visa free on a legal basis and have 30 days to apply and extend. And yeah, it’s still going on. So you can, immigration office usually works. You have this extraterritorial principle that you can apply in other authority. For example, if it was in Kharkiv and you are afraid to go, you can apply in Lyiv, and everything would go [crosstalk 00:09:55].
LADISLAS MAURICE: Okay. So people can still easily go into Ukraine. Generally, people go through Romania, Hungary, Poland. There are trains, buses, etc., also from Slovakia. And it’s possible to still get residency there, it’s possible to still run a low cost 5% business, etc. There’s still things going on. I mean, obviously, I’m not recommending this to anyone, but just so that people know, it’s a massive country, and yes, there’s a big conflict, but people are still going on with their lives.
TARAS: Yeah, true.
LADISLAS MAURICE: All right, fantastic. So if people are interested in getting in touch with Taras, there’s his email right below.
TARAS: Thank you very much.
LADISLAS MAURICE: Take care, Taras.
TARAS: Bye-bye, Ladislas.
