In 2009, the ski jump was valued at 1.2 billion rubles, in 2012 – at 8.9 billion rubles. / M. Mokrushin / RIA Novosti

That's how it is. After Vladimir Putin gave "Comrade Bilalov" a dressing down in absentia, law enforcement agencies became interested in the businessman

On April 10, 2013, it became known that a criminal case had been opened against the former chairman of the board of directors of OJSC Resorts of the North Caucasus (KSK) Akhmed Bilalov under the article "abuse of power". During the prosecutor's inspection, facts were revealed of KSK's failure to comply with the requirements of the legislation on concluding transactions, and measures were also not taken to preserve the property acquired by KSK for the implementation of its statutory goals. The company's expenses on management activities in 2012 were 1.3 times higher than its expenses on investment activities. In addition, violations were revealed related to Bilalov's personal activities and unjustified expenses for company management trips to foreign countries. According to the police, in September 2012, more than 2.5 million rubles were paid from KSK funds for Bilalov's stay in London from July 26 to August 13 and more than 877,000 rubles. - for transportation services. At the same time, as the Ministry of Internal Affairs claims, Bilalov was actually in London from August 4 to 8. From the reporting documents it followed that during the same period his accommodation in Krasnodar, St. Petersburg, Yessentuki and Mineralnye Vody was paid for.

In Krasnaya Polyana, in the area of Mount Aibga, construction does not stop for a minute. When you drive up by car on the road from Sochi, it seems that a whole city is growing on the right – the cranes and walls of houses under construction stretch so long. There is not a single living place on the construction site – workers, equipment. It is better to move around in rubber boots. Here, the two most problematic Olympic facilities are being built – the ski jump and the mountain media village.

You can see all this from Moscow, from the office of Sberbank Vice President and Chairman of the Board of Directors of Krasnaya Polyana OJSC Stanislav Kuznetsov. "Let me show you what's going on there now," says Kuznetsov and approaches one of the computers. Sberbank has had everything under control for a year and a half now. But it wasn't always like that.

How Bilalov ended up in Sochi

There are dark days in everyone's life. For Akhmed Bilalov, February 6, 2013, was a dark day when President Vladimir Putin inspected the Olympic facilities. Upon learning that the deadline for the ski jump in Krasnaya Polyana had been moved from June 2011 to July 2013, and that the construction budget had grown from 1.2 billion to 8 billion rubles, the president quipped: "Well done! You're doing a good job." Bilalov was removed from his position as chairman of the board of directors of the state company "Northern Caucasus Resorts" (NCR) and from his post as vice president of the Russian Olympic Committee. The Prosecutor General's Office and the Ministry of Internal Affairs began an investigation of NCR and opened criminal cases (see inset). The businessman went to Baden-Baden for treatment and is in no hurry to return.

And it all started well. In 2005, when Sochi applied to host the Olympics, Bilalov was a member of the United Russia faction in the Duma; he had good relations with the governor of Krasnodar Krai, Alexander Tkachev, whom he had met in the late 1990s. Bilalov became one of the sponsors of the Olympic bid campaign. Meetings to prepare the Sochi bid were held in a Moscow mansion on Khlebny Lane that he had rented. In July 2007, at a session of the International Olympic Committee (IOC) in Guatemala, this bid was approved.

And in early 2006, Bilalov bought the Gornaya Karusel ski resort in Krasnaya Polyana from Farkhad Akhmedov, the owner of Northgaz, for $15 million. The project involved building a trail, ski lifts, and – the key to payback – 250,000 square meters of real estate for sale. The status of a deputy does not allow one to formally own a business, so legally, control over the capital of Krasnaya Polyana OJSC, which is implementing the project, was given to the structures of Bilalov’s younger brother Magomed. At the end of 2008, they owned 84.85% of the shares. The rest belonged to the Krasnodar Region and the Sochi administration.

Where did the trampoline come from?

When Bilalov bought Gornaya Karusel, there was no talk of a ski jump. A month and a half before Guatemala, Bilalov was invited to see the Deputy Minister of Economic Development and Trade, Stanislav Kuznetsov. He said that the previous investor, the construction holding company Bamo, had refused to fulfill its obligations and offered the entrepreneur to finance the construction of a ski jump and a mountain media village on the territory of Gornaya Karusel. The total area of the property grew to 500,000–600,000 square meters, plus some more could be built around the ski jump. It was impossible to sell so much property at once, but the plans did not seem impossible – the resort was planned to be developed, and the Olympics would be good advertising for Sochi. The state promised to build infrastructure – roads, utilities and energy networks, and the proximity of the facilities to each other allowed saving on the delivery of construction equipment and building materials. Bilalov agreed.

Kuznetsov clarifies that the proposal to build the ski jump was made to all investors who were participating in the government program for the development of Sochi at that time – Gazprom, Interros, Basic Element, etc., but only Bilalov’s project was of interest. And in August 2007, Krasnaya Polyana sent a letter to the Ministry of Economic Development, asking to be appointed responsible for the construction of the ski jump. In December, then Prime Minister Viktor Zubkov approved the government program for preparing Sochi for the Olympics. The document stated that Krasnaya Polyana was an investor in the ski jump complex with 15,000 seats and the Gornaya Karusel complex, part of which was to include a mountain media village and hotels with 2,658 rooms. The ski jump was planned to be built by June 30, 2011, and the media village – by 2012.

How Sberbank got involved in the project

In the spring of 2009, a wealthy investor appeared in Krasnaya Polyana. The company's additional issue for 2.7 billion rubles was bought by a 100% subsidiary of Sberbank, Sberbank Capital; it received 25.01%. Thus, fate again brought together Bilalov and Kuznetsov, who became vice president of Sberbank in January 2009.

Why does Sberbank need Krasnaya Polyana? At that time, the project seemed very attractive – this was confirmed by all the documents and expert reports, Kuznetsov recalls. The total budget was 41.1 billion rubles. It was planned to build 800,000 sq. m of residential and commercial real estate. Its cost price was to be $1,600–1,800 per 1 sq. m, and the selling price – no less than $5,000. More than one ski jump could be built for such a difference.

Kuznetsov headed the board of directors of Krasnaya Polyana, which included Sberbank Capital CEO Ashot Khachaturyants. The company's charter was amended, according to which all decisions at the board must be made by votes of at least eight of the nine members, i.e. with the consent of Sberbank Capital representatives. So, strictly speaking, Putin had grounds to ask questions about the trampoline not only to the absent Bilalov, but also to Sberbank President German Gref, who was standing nearby during the inspection.

Kuznetsov, however, does not agree with this. The board members did not have full and real information about the project, he explains: "For example, the board members did not know that geological surveys at the ski jump construction site had not been properly conducted, and this ultimately significantly complicated the construction and made it more expensive." Magomed Bilalov denies concealing any information from the board of directors: "All board members had or could request all the necessary information and were required to approve transactions over 150 million rubles."

According to Kuznetsov, in 2010, the design and construction deadlines had not yet been violated, but problems were already visible – the management of Krasnaya Polyana, which was controlled by Bilalov at that time, could not calculate the full cost of the project due to the lack of design documentation. “The problems of lagging behind construction schedules, incomplete design documentation and lack of understanding of the final budget became obvious only in the summer of 2011. Then Sberbank quickly allocated two bridge loans totaling 3 billion rubles,” says Kuznetsov.

How the roads got mixed up

When Putin arrived for an inspection in Krasnaya Polyana, the ski jump was ready. But there was no accompanying infrastructure. For example, no normal stands or referee tower. And most importantly, there were no ready roads.

In 2008, the government program included the state's commitment to build a road from the existing A148 highway to the border of the land plot where the ski jump is located. Krasnodar Krai built this road at the expense of the federal budget in 2011. However, Bilalov hoped that the state would connect both sites - the ski jump and the media village - with roads. Magomed Bilalov says that in 2008-2009 there was a project, tentatively supported by Deputy Prime Minister Dmitry Kozak, to build a road that would connect the lower part of the media village with the upper part, the upper part with the ski jump, and the ski jump with the A148 highway (see the picture).

A source close to Kozak objects that he never promised this, but gave the order to calculate the cost of such a project and did not support it precisely because of the high costs - it came to 24 billion rubles. In 2010, Kozak nevertheless agreed to build a road from the lower media village to the upper one at the state's expense, but for much less money - 4 billion rubles. There will simply be no road from the ski jump to the upper village. And there was a terrible mess with the road from the border of the site where the ski jump is located to the stands and from there to the launch pad.

This road is the main one for the normal operation of the ski jump. Athletes and spectators must use it to get to the site. From the design documentation and other documents that Krasnaya Polyana sent to Olimpstroy for approval in 2009–2010, it follows that the company promised to build this road – it was planned to be of category IV. This is a normal road covered with asphalt, explains Mikhail Blinkin, Director of the Institute of Transport Economics and Transport Policy at the Higher School of Economics. Two lanes (one in each direction) of 3.5 m were planned.

However, in October 2010, the IOC inspection commission indicated that the road was too narrow – buses with members of the Olympic family (IOC members, athletes, journalists, etc.) would not be able to pass. The IOC did not want to travel to the stands by cable car, which Olympstroy is building from the nearest Esto-Sadok railway station.

In February 2011, Gref and Tkachev wrote a letter to the government stating that Krasnaya Polyana would not be able to build an improved road at its own expense. In April, Kozak ordered Olimpstroy to build the road, and in December, Prime Minister Putin made the corresponding change to the Olympic construction program. But Olimpstroy never started building the road, which the Bilalovs are now pointing out. An Olimpstroy employee explains that it is impossible to design and build the road separately from the ski jump, since it is part of the engineering protection of the entire facility. Therefore, in May 2012, Kozak decided that Krasnaya Polyana would build the road after all.

How the ski jump became more expensive

Initially, the ski jump cost 1.2 billion rubles. The board of directors of Krasnaya Polyana commissioned the German Kohlbecker Architects & Engineers to make a project with such a budget. However, the Main State Expertise did not like the developed project due to the lack of engineering protection. According to the conclusion of Roshydromet from February 2010, there are high risks of avalanches, landslides, mudflows and flooding of the territory at the construction site.

In April 2010, when Glavgosexpertiza first approved the project, the ski jump cost 1.9 billion rubles, and the deadline for its completion was postponed until the end of 2011. In August 2011, the ski jump went up in price to 2.7 billion rubles, in November 2011 – to 3.9 billion rubles, and in April 2012 – to 4.5 billion rubles. All budgets took into account the construction of a technological road only from the stands to the launch tower; expenses for the road from the border of the land plot to the stands were not included, Kuznetsov explains.

The ski jump went up in price for three reasons, Kuznetsov believes: poorly conducted engineering surveys, errors in the design documentation, and additional requirements for the facility from the IOC and the Sochi 2014 Organizing Committee. The costs of the preparatory stage and construction materials turned out to be higher than planned (the costs for cement turned out to be twice as high as the original), and there were costs for the construction of electrical networks, storm drains, parking, and pools with water for snowmaking; instead of temporary stands, they decided to build permanent ones, Kuznetsov lists. Magomed Bilalov cites two reasons - additional requirements from the IOC and the road to the stands that Olimpstroy did not build. "The engineering surveys were carried out properly, which was confirmed three times by Glavgosexpertiza," he insists.

Kozak's decision that the disputed road is being built by Krasnaya Polyana has immediately doubled the project's budget - from 4.5 billion to 8.9 billion rubles. Sberbank hopes that the final costs will not exceed 8 billion rubles. There is an opportunity to save, Kuznetsov explains.

How Hope for the Village Faded

Expenses were growing, and the hope of recouping them through real estate was fading. Due to complex geology and problems with roads, Bilalov abandoned plans to build real estate around the ski jump back in 2009. Apartments in the media village, which they decided to call Gorki Gorod after the Olympics, sold sluggishly, says a federal official. From 2009 to 2012, they managed to find only 100 potential buyers, of whom 20 have already refused, says a source at Krasnaya Polyana. Magomed Bilalov says that there were 120 buyers, and the delay from the plan was only 20%.

It was clear from the start that it would be impossible to sell such a volume of real estate in Krasnaya Polyana, says another acquaintance of Bilalova: “According to experts, up to 1 million square meters could be sold in Krasnaya Polyana, but Interros, Gazprom and smaller investors are building nearby. It turns out that, on average, each large investor needs to build no more than 300,000–350,000 square meters.”

The cost price per square meter has now risen to $2,800, making the project unprofitable, says Magomed Bilalov. Kuznetsov explains the increase in the budget by the fact that the costs were initially underestimated: "It is impossible to build a five-star hotel in the mountains for $1,600 per square meter." According to the terms of the additional loan agreement with VEB, Krasnaya Polyana cannot sell real estate before the Olympics. Sberbank has not disclosed the prices at which sales will begin after the competition. However, even at $2,800 per square meter, it will not be so easy to sell apartments. Last summer, a representative of Bazel, which is building the Olympic Village in the Imeretinskaya Lowland (closer to both the sea and the airport), said that it would be sold for 50,000–70,000 rubles per square meter.

Experts interviewed by Vedomosti believe that it is not even a matter of price. It is practically impossible to sell housing in Krasnaya Polyana, since it is a resort and there are very few people willing to buy permanent housing there, Penny Lane Realty CEO Georgy Dzagurov and Vincent Real Estate Deputy CEO Boris Lebedev are unanimous.

When it became clear that the project was unprofitable, Bilalov lost interest in it, two federal officials believe.

How Sberbank saved the project

Kuznetsov shows a photo of himself standing at the site of the future ski jump in August 2011. In less than six months, the ski jump should be completely ready, but the photo only shows a clearing and dug up earth. The failure to meet the deadline led to a conflict between Kozak and Bilalov. Kozak was furious that the company was disrupting the project, Bilalov reminded in response that the authorities had not kept their promise to build the infrastructure.

Then the real scale of the problems became clear, notes Kuznetsov. In February 2012, President Dmitry Medvedev called a closed meeting on the ski jumps and the media village. Gref said that Sberbank was ready to sell its stake to any state structure willing to save the project. But Medvedev decided that Sberbank itself should be the savior. No organizational conclusions followed – Bilalov remains in charge of the “Northern Caucasus Resorts”.

In June, the state bank bought out an additional issue of Krasnaya Polyana for 7.5 billion rubles, increasing its stake to a controlling one. Bilalov's structures bought out shares for another 1.5 billion rubles, retaining 42%. Sberbank changed the management of Krasnaya Polyana and terminated contracts with the technical customer and consultant of the project, Bilalov's company NBB-Development; its functions were taken over by the management of Krasnaya Polyana itself. And, without changing the general contractor, the company Transkomstroy (where Magomed Bilalov's structures still own 49%), it replaced the main subcontractor, inviting the Turkish Sembol.

The area of the property was reduced to 621,000 sq. m (including housing - 475,000 sq. m). At the same time, the budget of the entire project (media village plus ski jump) is now 70 billion rubles. The credit line in VEB was increased from 14 billion to 52 billion rubles. "We were told that we were managing the project poorly. But under Sberbank, the budget almost doubled - and the project became unprofitable," notes a person from NBB-development. Kuznetsov explains the increase in expenses by the fact that they were initially underestimated.

How unlucky Bilalov was

By the time Bilalov fell under Putin's hot hand, Sberbank had been managing Krasnaya Polyana for a year. But, having distanced itself from the troubled project, it failed to be in the right place at the right time.

On the eve of Putin's visit to Sochi, Bilalov, his friend says, called Kozak and asked for permission to come and accompany the president on the ski jump. However, Kozak said that there was no point in coming, since Gref was responsible for the facility. Kozak's representative did not comment on this. After the dressing down, Bilalov flew to Sochi. The next day, Putin had a meeting on the results of the inspection of the Olympic facilities, and Bilalov wanted to attend it to present his version of events. However, he was not allowed to attend the meeting.

Everyone spoke out against Bilalov at once – Kozak, Gref and even Tkachev, says a member of the presidential administration. But not at any specific moment – they simply made it clear to the president throughout 2011–2012 that Bilalov was to blame for the project’s woes. The fact that Bilalov did not have access to Putin played a role, says a friend of Bilalov’s: “He is a man from Medvedev’s team. Whereas Kozak, Gref and, to a lesser extent, Tkachev had access to the president.”

After leaving Russia, Bilalov sold 42% of Krasnaya Polyana shares to Mikhail Gutseriev's structures for $20 million. In May, Krasnaya Polyana announced an additional issue. It was not possible to find out whether Gutseriev would participate in it. But Sberbank's structures have already received permission from the antimonopoly service to increase their share to 94.71%. Sberbank will most likely not be able to make money on the project, Kuznetsov admits: "But Sberbank still hopes to recoup its expenses."

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