An exclusive interview with Mehmet V. Sacaklioglu, the founder & chairman of the Bosphorus Development supervisory board, for Interfax-Ukraine
Tell us about Bosphorus Development.
Our company is one of the largest investment and development companies in Turkey. My grandparents started a business in the 1930s. I am a representative of the third generation. The family business started with retail, then the company launched other business activities, including the opening of a network of grocery stores, restaurants and bakeries, production of furniture, textiles, as well as gas supply and trade in petroleum products.
Our company implemented the first development project in 1970. More than 5 million square meters of real estate have been built, more than a hundred projects have been completed in 51 years.
Among the landmark projects for us are Istanbul Aquarium – one of the largest themed aquariums in the world, with a total area of 23,000 square meters, and the largest business center Istanbul Tower 205 (220 meters high, 246,000 square meters).
We have our own architectural team, but we also work with the world’s best architects. In particular, for Istanbul Tower 205, we considered the proposals of many leading architects around the world, but focused on the project of the American company Skidmore, Owings & Merrill (Burj Khalifa in the UAE, One World Trade Center in New York, Tianjin CTF in China).
We have also built several malls, the Crowne Plaza Istanbul hotel and about a hundred business and premium class residential projects. Today, six facilities in Istanbul are under design and initial implementation.
Why did you choose Ukraine to expand your development direction?
I have been living in Ukraine for 20 years, married and raised two children here, graduated from the Institute of International Relations of the Taras Shevchenko National University of Kyiv. Ukraine is my second homeland. During these years I’ve developed business in various directions, but now decided to focus on development.
In Ukraine, we already have a fairly large land bank. Today it includes four land plots, we are negotiating the purchase of three more land plots. Before the start of construction work, we would not like to name the locations. I can only say that all the sites are located in the central part of the capital.
What characteristics must a land plot have to be interesting for your company?
Many factors are important for the implementation of a successful project: location, infrastructure, transport links, the availability of social facilities and others. The size of a land plot must be at least 1 hectare, but if the location is very interesting, it may be less. A necessary condition is that it must be impeccable from a legal point of view. To establish the compliance of a land plot with our standards and requirements, we necessarily conduct due diligence, they were made for us by well-known international companies such as Baker McKenzie, Ernst & Young, DLA Piper.
Unfortunately, there are no completely “white” areas in the capital, without potential conflicts.
If this is true, it may be one of the reasons why there are very few international developers in Ukraine.
Ukraine and Turkey have historically had very good relations, with Turkish companies actively involved in the construction of important infrastructure facilities in Ukraine, but Bosphorus Development will be the first Turkish development company to implement projects of this scale in the Ukrainian capital.
Which construction sector did you choose to invest in? What projects do you plan to implement?
As I mentioned, we have experience in implementing projects of any complexity and different types: housing, hotels, trade, commercial real estate, infrastructure and others.
Our first project in Kyiv will be a multifunctional residential complex with commercial and social facilities. It will be business class housing, with interesting and original architectural solutions, with the use of high-quality materials, in harmony with the environment, with a well-thought-out and useful infrastructure for residents. The project has already been developed by our architects in collaboration with Ukrainian colleagues.
In the construction of our facilities, we use only high-quality and environmentally friendly materials that have undergone thorough inspection, examination and certification. In Turkey, we have our own production of construction and finishing materials. For example, all wood elements and constructions in our projects are our own.
In Ukraine, we are currently studying manufacturers and suppliers of construction materials, analyzing which Ukrainian materials to use and which to import. As an example, the quality and characteristics of Ukrainian finished granite completely suits us. As for ceramic granite – we choose between Turkish, Italian and Spanish manufacturers. Windows and facades – there are several representative offices of Turkish and German manufacturers in Ukraine, we are studying their proposals. If we control the whole process of materials production and if they fully meet our requirements, then, perhaps, we will make a choice among Ukrainian manufacturers.
When will you present the projects and start their construction?
The construction of our first project will start in the first quarter of 2022, then we will talk about it in more detail, make a presentation. Our second project, no less large-scale – at the end of 2022.
How many staff do you have in the company in general and how many will work in Ukrainian projects?
The Turkish staff is over 1,500 people. In Kyiv, we are currently recruiting a team for the first project, and plan about a hundred employees at the initial stage. If necessary, we will bring highly qualified specialists from Turkey – management, engineers, architects, builders and others. We are studying this issue in terms of the quality of work and professionalism of local staff. About 500 employees will be needed to implement our initial projects.
Are you planning to certify your projects according to “green” standards?
Most of our projects in Istanbul are certified according to LEED standards. For example, Istanbul Tower 205 meets the LEED Platinum quality standard. Regarding Ukrainian projects, we are currently in the process of negotiating and choosing a certification system.
How much will be invested in the implementation of projects?
After the official presentation of our projects, we will launch sales, but regardless of the activity of buyers in the real estate market and potential investors, regardless of the economic situation in Ukraine, we have enough financial resources to complete and implement them in a timely manner.
National bank of Ukraine’s official rates as of 22/12/21
Source: National Bank of Ukraine
Official rates of banking metals from national bank as of December 22
One troy ounce=31.10 grams
The turnover of retail trade in Ukraine in November 2021 compared to the same month in 2020 in comparable prices increased by 5.8%, while in October the growth was 5.7%, the State Statistics Service reported.
According to its data, in November compared to October 2021, retail turnover increased by 0.1%.
In January-November 2021, compared to January-November 2020, the retail trade turnover increased by 11.2%, to UAH 1.29 trillion.
The largest growth in retail trade turnover of enterprises (legal entities and individual entrepreneurs) for the 11 months of 2021 compared to the same period in 2020 was recorded in Chernivtsi (by 27.6%), Ternopil (by 24.4%), Zakarpattia (by 20.3%), Vinnytsia (by 19%), Lviv (by 18.1%), Poltava (by 17.5%), Rivne (by 15.3%), Cherkasy (by 13.3%), Khmelnytsky (by 13%), Odesa (12.6%), Ivano-Frankivsk and Chernihiv (12.4%), Kyiv (12%), Mykolaiv (11.5%) regions.
According to the statistics department, the leaders in absolute indicators of the volume of retail trade in 11 months ending November 30, 2021 were: Kyiv city (UAH 248.785 billion), Dnipropetrovsk (UAH 118.223 billion), Kyiv (UAH 108.185 billion), Odesa (UAH 95.664 billion), Kharkiv (UAH 87.153 billion) and Lviv (UAH 79.974 billion) regions.
The State Statistics Service said that the turnover of retail enterprises (legal entities) in November 2021 compared to November 2020 grew by 6.4%, compared with October 2021 – by 0.1%, amounting to UAH 92.464 billion.
At the same time, in January-November this year, the retail trade turnover of enterprises increased by 11.4% (compared to January-November last year), to UAH 933.435 billion.
The wholesale turnover of enterprises (legal entities) in January-November 2021 compared to the same period in 2020 fell by 7% and amounted to UAH 3.006 trillion.
The State Statistics Service reminds that the data are given without taking into account the temporarily occupied territories of the Autonomous Republic of Crimea, the city of Sevastopol, part of Donetsk and Luhansk regions.
Ukrainian President Volodymyr Zelensky has said that Ukraine plans to open a new embassy building in Turkey next year.
“We have begun to build the first Embassy in Turkey over the past 10 years. It is modern and very cool. We are sure that next year we will open this Embassy. The task is to build it quickly. The main thing is still quality,” Zelensky told reporters at a conference of Ukrainian ambassadors at the state residence Synehora in Ivano-Frankivsk region on Tuesday.
He also added that within the framework of the conference, the issue of updating the diplomatic missions of Ukraine in other countries was discussed.
In January-November of this year, Ukrainian coke and chemical plants reduced production of metallurgical coke with 6% moisture content by 1% compared to the same period last year, to 8.731 million tonnes.
As the Ukrkoks association of coke and chemical enterprises (Dnipro) told Interfax-Ukraine, in November 727,000 tonnes of coke were produced.
Director General of Ukrkoks Anatoliy Starovoit told Interfax-Ukraine that in November and December the country’s coke and chemical enterprises operate at approximately the same load.
“There are slight fluctuations in production, when one battery is removed, the other is introduced, but in general these are minor changes,” the agency’s interlocutor stated.
According to him, the share of import coking coal supplies to coke and chemical plants amounted to 71.9% over 11 months of 2021, while over 11 months of 2020 – 72.7%.
“In total, in January-November of this year, 11.834 million tonnes of coal and concentrate were supplied to coke and chemical plants, including coal of Ukrainian production – 3.32 million tonnes, and 8.5 million tonnes of imported coal. In particular, 5.4 million tonnes of coal and concentrate were imported from the Russian Federation, 2.3 million tonnes from the USA and Canada, 711,000 tonnes from Kazakhstan, and the rest in small volumes – from Poland, the Czech Republic and other countries,” Starovoit said.
At the same time, the CEO reported updated data for 2022, according to which 14.2 million tonnes of coking coal will be required to smelt 21.5 million tonnes of cast iron. “On average, 460 kg of coke per tonne of cast iron,” the agency’s interlocutor said.
Earlier it was predicted that for the smelting of 21.5 million tonnes of cast iron in 2022, some 9.9 million tonnes of metallurgical coke, or 11.5 million tonnes of gross coke, would be required, for which 15.7 million tonnes of coking coals would be needed, including 12 million tonnes of imported coal.
“We have adjusted the demand for coke to 460 kg per tonne of cast iron, whereas earlier we used about 500 kg per tonne of cast iron,” Starovoit said.
According to recent data, over 11 months, in particular, Avdiyivka Coke and Chemical Plant reduced coke output by 9.7% compared to January-November 2020, to 2.417 million tonnes (224,000 tonnes were produced in November), Azovstal – by 9.8%, to 1.111 million tonnes (97,000 tonnes), Dniprovsky Coke and Chemical Plant – by 6.3%, to 505,000 tonnes (43,000 tonnes), Dniprokoks increased production by 10.7%, to 526,000 tonnes (51,000 tonnes), and Zaporizhkoks decreased production by 0.8%, to 887,000 tonnes (75,000 tonnes). Kharkiv Coke and Chemical Plant is idle. Coke production at ArcelorMittal Kryvyi Rih increased by 10%, to 2.640 million tonnes (188,000 tonnes), and at Pivdenkoks – by 7.7%, to 645,000 tonnes (50,000 tonnes).
