Analysis of the Economic Prospects of the Transition from Shared Construction to Project Financing on the Example of St. Petersburg Market

The study examines the economic prospects of innovations in the Federal Law № 214 “On participation in the shared construction of apartment buildings and other real estate objects” which were introduced in Russian Federation in the end of 2017. These innovations are coming into force from 01.07.2019 and this fact makes the work relevant and significant. The aim of the study is to identify all the key economic prospects for the transition from shared construction to project financing and their assessment. The main objectives of the study are analysis of the theoretical and legal aspects of this transition in terms of financing of construction projects, analysis of foreign experience of project financing in construction and its comparison with Russian practice, as well as the assessment and forecasting of economic changes in the construction industry based on the collected data on the implemented projects of St. Petersburg. The obtained results proved that the innovations in the legislation will indeed lead to several significant changes in the economic aspects of the construction industry, including a constant decrease in the interest rate on the loan depending on the balances on escrow accounts, an increase in the cost of construction by 3.8 % - 9.7 % depending on the rate of sales and an increase in residential real estate prices to 10.1 %.