Revenues of budgets of various levels from small-scale privatization of state and municipal property in the state electronic trading system Prozorro.Sale amounted to almost UAH 3.3 billion in 2023, according to a joint press release on Thursday.
“In total, in 2023, businesses and citizens privatized almost 914 objects across the country. 350 of them are state property sold by the State Property Fund (SPF) and its regional offices through online auctions on Prozorro.Sale, and another 560 are assets sold by communities,” said First Deputy Prime Minister and Minister of Economy Yulia Svyrydenko.
It is specified that the state budget received more than UAH 2.6 billion, while the privatization of communal facilities brought communities more than UAH 650 million, and the price of the facilities increased almost threefold as a result of electronic auctions.
“It is important that privatization is not just a one-time revenue for the state or local budgets, it is primarily about attracting investment and economic development,” emphasized Svyrydenko.
CEO of Prozorro.Sale Serhii But noted that in total, more than 3.6 thousand participants competed for the right to purchase state and municipal property in 2023.
“The business demand for small-scale privatization objects in the second year of the full-scale war remains, with an average of more than three bidders. Factories, hotels, warehouses, outpatient clinics, car dealerships – these and other objects have found a new effective owner this year thanks to online auctions,” said Booth.
Head of the SPF Vitaliy Koval added that, in addition to development and modernization, job creation and mastering new markets, another important area of privatization auctions under martial law is the search for objects for business relocation. According to him, this is especially relevant for the hospitality industry (catering, restaurant business and hotel industry), agricultural, logistics and other sectors of the economy.
“That’s why the most popular real estate objects, which is 76% of the sold property, are industrial and administrative assets. Businesses are interested in the so-called brownfields – abandoned enterprises with communications. After all, it is enough to make repairs there and you can start your own business or expand an already running production,” explained the head of the privatization agency.
He said that the SPF plans to actively involve big business in privatization.
“We are already preparing a large-scale privatization. We also plan to open a transparent agricultural land lease market and sell the aggressor’s assets at auctions to compensate for the damage caused by the war,” said Koval, who previously announced a goal of over UAH 4 billion from privatization in 2024. Among the most interesting proposals for next year’s auctions, the SPF mentioned the UMCC, Demurinsky GOK, Centrenergo, Odesa Port Plant, Ukraina Hotel, and Ocean Plaza shopping mall in Kyiv.
According to the press release, the highest price for the privatization of state-owned facilities in 2023 was paid by the winning bidders for the Hermitage Hotel in Kyiv – UAH 311 million, the unified property complex (UPC) Volyntorf – over UAH 212 million, and the UPC of the State Enterprise Ukroboronresursy – over UAH 210 million.
It is specified that among the communities that actively worked with the small-scale privatization market, Dnipro was the most active – 35 successful auctions, Lviv – 32, and Kyiv – 23. The most expensive municipal privatization objects this year are the Zhytomyr Regional Cinematography Center – UAH 40 million, non-residential premises in Lviv with an area of 550 square meters – over UAH 25 million, and non-residential premises in Zhytomyr region with an area of almost 600 square meters – over UAH 22 million.
As reported, small-scale privatization in Ukraine was suspended with the start of full-scale Russian aggression in February and resumed in September 2022. In less than the last four months of last year, more than UAH 1.4 billion was transferred to the budgets of various levels as a result of more than 200 auctions.
