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World Cup 2018: 12 stadiums finished, 108 in the ether

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World Cup 2018: 12 stadiums finished, 108 in the ether

Every day the countdown continues for the opening of the World Football Championship, which will take place in Russia in 2018. The question of whether the country will manage to do everything in time during these crisis-ridden times is worrying everybody.

The preparation for the World Cup 2018 is going on in Russia. A vast volume of work is to be fulfilled, which is being complicated by a far-from-ideal economic situation. However, the tasks have been set and they are to be fulfilled. Russia will do its best, and the Olympiad in Sochi is proof of this. 

First money, then football

On June 20th, 2013, the Russian Prime Minister, Dmitry Medvedev, signed the government decree, “On the preparations for holding the World Cup Football Championship in Russia in 2018”. It includes the main events and their predicted cost to the federal budget, regional budgets and investors.  

The cost of the program’s implementation totals 664.1 bln roubles, including 336.2 bln roubles from the federal budget, 101.6 bln roubles from the regional budgets, and 226.3 bln roubles to be drawn from non-budgetary sources. This was to be spent on the construction and reconstruction of 12 stadiums in 11 Russian cities including Moscow, Saint Petersburg, Ekaterinburg, Sochi, Kazan, Nizhny Novgorod, Samara, Rostov-on-Don, Kaliningrad, Volgograd, and Saransk.

But this is only the tip of the iceberg. In fact, while preparing for the World Cup 2018, 108 stadiums with a capacity of 3,000—5,000 spectators will be built. These sports facilities are for exercise and training. Besides this, a number of old sports arenas will be reconstructed. It was planned that 177 bln roubles would be spent on the construction of stadiums, 120.9 bln roubles of which would be federal money.

But it is not only sports infrastructure which is to be created. The program includes the construction of 60 new hotels, and if the construction of sports facilities is being financed mainly by the public purse, hotels are to be constructed at the expense of private investors. 

Besides this, a number of medical centers are to be repaired for use of foreign guests.

It is interesting that in the process of preliminary calculations, the regions claimed twice as much money as the initial sum. 917 bln roubles was requested. If we add probable investments from natural monopolies, the total sum surpasses 2 trn roubles. The host cities of the World Cup, as well as leading state companies, wanted to use the event to get additional money for their development.

Key matches and stadium capacities

But, alas, life intruded on these overly optimistic plans. The World Cup budget has been cut several times already.  In April the RF Government took a decision on the expenditure cut: from 620,865.9 m to 617,167.6 m roubles. According to the Minister for Sport, Vitaly Mutko, the budget reduction does not affect the construction of stadiums and infrastructure – the money connected with the organizational aspect of the championship will be reduced.   

 

Who pays for the banquet?

As soon as it became known that the World Cup would take place in Russia, there arose the question of if the expenses would be recouped. It is a good thing that a third of all expenses are to be taken from non-budgetary sources.  

To remind you, 98% of the 1980 Olympics expenses were from the state budget of the USSR, and 70% of the money spent on the 1984 Olympics in Los Angeles were private investments. World experience shows that the larger the private investments in such events, the higher the payback.  

According to statistical research, during a World Cup, 57% of tourists come to the host country to watch the matches, whilst the other 43% have other objectives. Thus, the Football World Cup is a good booster for tourism and the corresponding infrastructural development, which can be maintained after the championship.   

It may sound odd, but the principal expenses for the World Cup are not so much connected with the construction of stadiums but with social objects. The International Federation of Association Football (FIFA), as well as the IOC, specify strict requirements for the host cities regarding the ‘friendliness’ of the urban environment: the development of transport infrastructure, hotels, drug stores, cafes, restaurants, etc. 

Oh, Samara - stadium

On October 8th, 2015, FIFA published the official list of the stadiums where the matches will take place. Only one of them – Moscow’s “Otkrytiye Arena”, the home stadium of Moscow Spartak - is operational now. The others are under construction.

 

World Cup 2018: 12 stadiums finished, 108 in the ether

Photo: The Samara Arena stadium construction, February, 2016

 

In April, 2016, the FIFA inspectors visited Russia to check on the preparation of the stadiums for 2018. On the whole, the officials were satisfied with the course of the work.

It should be remarked that the construction began badly: for example, the location of the Ekaterinburg Arena in the Urals had been discussed for two years.

The Samara Arena first was supposed to be erected in the Samarka River valley, but then the location was moved to the other end of the city. Besides this, the construction process was delayed because of a conflict with the residents of nearby houses who were to be resettled. But these are not all of the problems the Samara stadium has: it has become known recently that its construction is at risk of failure. The contractor (PSO “Kazan”) has demanded an increase in the estimated price. According to the company directors, it is impossible to build such a big sports facility for the initial 13 bln rouble price.

As a result, the regional government had to change contractors, but there is some doubt as to whether the new company will meet the cost.  

The Samara stadium is one of the largest objects of World Cup 2018: its area and volume are much larger than the other stadiums, even the large ones such as Kazan Arena and Moscow Luzniki. Many experts have remarked upon the unjustified scope of the object and think that the initial cost was too low. “The stadium project turned out a third bigger than other similar sports facilities, and it ate up over 20 bln roubles. More than 40% of its area is meant for commercial use. There are a lot of potential solutions. Now, a reduction of the project is being considered”, Alexander Khinstein, Deputy of the State Duma, said at a press conference in Samara at the end of April. His claim about “multibillion rouble corruption in the Samara region” before the FIFA delegation’s visit to Samara caused a conspicuous scandal. “In my opinion, it is a deception of the federal center and the government. Competent authorities will study the case. We’ll see the results of their work”, the parliamentarian said.

It may be a moot point, but even Vitaly Mutko did not know the exact sum needed from the federal budget for the construction of the stadium in the regional city. “Governor Merkushkin wanted to create a significant heritage object: a vast stadium. A whole recreational area has been designed, and we still cannot determine the final cost”, the RF Minister of Sports admitted

The situation in Samara is not an organizational failure, but a systematic failure. That’s what the President of the Estimator-Engineers’ Union, Pavel Goriachkin said: “The state is in a maze with the construction’s estimated costs! Builders do not want to go bankrupt at significant state construction sites, and do not want to go to prison as a “present” from the state. Inadequate prices and contract conditions, blackmail and under-the-table payment, constant inspections, delinquency… that’s what constructors expect at such objects, he said and added, “Very large, serious, respected construction companies have been “burnt” lately at state construction sites, and this negative tendency will continue”.

We are going to watch the development of the conflict concerning the stadium in Samara, but now nous revenons à nos… stadiums. 

To be remade

The first project for the “Volgograd Arena” sports facility in Volgograd was rejected by the state expertise after they pointed out 40 ‘punch’ points. In Rostov-on-Don, the Russian Technical Supervisory Authority went to the law courts with the general contractor for the usage of piles of lower quality than identified in the documents.

Photo: The Volgograd Arena stadium construction

Kazan Arena, erected for the 2013 Universiad, turned out not to be ready for the football competitions either. While preparing for the Water Sports World Championship that took place in the capital of Tatarstan last year, the stadium was transformed into a swimming center. All these facilities are to be dismantled for 2018.

The famous Fisht stadium in Sochi, in which the opening ceremony of the 22nd Winter Olympic Games took place, turned out not to meet FIFA requirements. In particular, the roof over the play zone must be dismantled and side tribunes must be built. This work is to be completed this year.  

The reconstruction of Moscow’s Luzhniki Stadium, for the first and the final matches, is much more successful. According to the plan, all construction work at the object is to be completed in December, 2016, and the stadium is to be put into operation in February, 2017. To remind you, all facilities for track and field have been removed and the stadium has become nothing but a football pitch. That’s why it is the most complicated object of 2018 World Cup. The designers and constructors were given the task of preserving the unique historical look of the stadium, and yet still making it a modern object regarding the use of technology.

Kaliningrad Stadium is also worth mentioning. Its construction started later than the others, but the work is proceeding fast. The arena has its shape: by the end of April the foundation was poured, and metal structures are being assembled now. At the same time, the preparation work for the roof assembly has started. 

Can’t live without corruption

Zenit Arena in Saint Petersburg is a whole different thing. It is the most long-delayed of all Russian stadiums. It has been in the process of being built since 2007, and its budget has grown from 6.7 bln roubles to almost 35 bln.  

The construction was first supposed to be financed from local sources and the city budget, but in 2012 it became clear that the money was not sufficient. In September, 2012, the construction site was visited by Dmitry Medvedev and it was then decided that the money would be allotted from the federal budget. “It is not simply a long-delayed construction project, it is a source of shame”, the Prime Minister said at that point. As a result, the matter was delayed and, according to the city authorities, the object will be commissioned in December, 2016.

The construction of the arena has been accompanied by corruption scandals fit for a novel. The latest news: the Vasileostrovsky district court of Saint Petersburg obliged the Director General of one of the subcontracting companies, Dmitry Korshunov, to pay back more than 570m roubles of the city budget’s money. 

Mr Korshunov’ company, “Stary Gorod” (‘Old City’) dealt with the arrangement of cast piles at the stadium. Later it turned out that the price of the piles was set twice as high as it should have been, which led to a cost increase by more than 500m roubles.

And if we compare…

So, how much will the Russian stadiums constructed for 2018 cost if we compare them with modern foreign analogs (see table)?

To make a correct comparison, according to engineer-estimator Pavek Goriachkin, one should not use the official euro rate from the RF Central Bank, but the so-called “calculated rouble and euro parity index referring to the cost of construction and assembly operations” (purchasing power parity in construction). The given parity is calculated based on the cost of similar construction resources in Russia and in, say, Europe. For example, the euro rate for the adapter fitting cost is about 110 roubles to the euro, and ready-mixed concrete is 64 roubles to the euro.

The sense of parity is to show not what a conventional set of construction resources (labour payments, materials, equipment, etc.) costs in a given country but in terms of foreign currency. “According to our assessment, such parity in construction is about 46-52 roubles to the euro”, thinks the President of the Engineer-Estimators’ Union.

As a reference point, at the point of this article’s publication, the official rate of the All-European currency in Russia was 74.11 roubles to the euro. 

Simpler and cheaper

It should be noted that since the moment of being awarded the World Cup 2018, the Russian authorities have strived to organize the competition like they did the Sochi Olympics, i.e. without scrimping.  But, as we have already said, life has intruded, and some non-standard architectural solutions had to be rejected and the number of seats for spectators had to be decreased. For example, an unusual roof was planned to look like the Don River, and in Kaliningrad a unique entrance overhang resembling a Baltic wave was to be built, but in the end a simple standard framework of ready-made structures will be erected there.

The stadiums’ capacity has been significantly reduced: the total number of seats will not surpass 580,000. To compare: at the World Cup 2014 in Brazil and at the World Cup 2006 in Germany there were about 660,000 seats. Besides, part of the tribunes will be temporary and after the event they will be dismantled, decreasing the total number of seats to 496,000.

 
Looking forward to the event

Worldwide experience shows that holding such grand events as Olympics or World Football Championships changes the face and character of many cities, and even regions. For example, after the Olympics in Barcelona in 1992, the city got a reputation for being one of the most visited tourist centers in Europe, and indeed in the world. Calgary became a popular ski resort after the first Canada Winter Olympic Games: the number of tourists visiting the city annually has reached 3m people.

Will such changes happen with our Russian cities? Let’s hope so.

Millions of spectators are currently looking forward to the moment when the referee blows his whistle, and the worldwide feast of football starts.

Our journal will keep a careful eye on the course of the construction work at the World Cup objects, and we will tell you about the new stadiums in detail.

 

Vladimir GURVICH

 

 

The name of the stadium

 

City

 

Stadium capacity (number of seats)

 

Construction cost (m euro)

 

The year of opening

 

Construction cost of one seat (euro)

 

Wembley stadium

London

90 000

912

2007

10 137

Emirates Stadium

London

 

60 335

440

2006

7 292

Grand Stade Lille Metropole

Lille

50 157

324

2012

6460

Melbourne Rectangular Stadium

Melbourne

30 050

186

2010

6 179

Lvov Arena

Lvov

34 915

211

2011

6 043

Friends Arena

Stockholm

50 000

300

2012

6 000

Donbass Arena

Donetsk

51 504

294

2009

5 706

Allianz Arena

Munich

69 901

340

2005

4 864

Astana Arena

Astana

30 000

136

2009

4 524

Nelson Mandela Bay Stadium

Port-Elizabeth

48 459

214

2010

4 416

Gdansk municipal stadium

Gdansk

43 615

185

2011

4 260

Bucharest national stadium

Bucharest

55 600

234

2011

4 209

MMArena

Le Mans

25 000

102

2011

4 080

Stade Oceane

Havre

25 178

101

2012

4 011

Arena do Gremio

Porto-Alegre

60 540

239

2012

3 955

Forsyth Barr Stadium

Dunedin

30 748

113

2011

3 666

BBVA Compass

Stadium

Huston

22 039

77

2012

3 472

Amex Community Stadium

Brighton

22 500

76

2011

3 380

Juventus Stadium

Turin

41 000

125

2011

3 049

Turk Telecom Arena

Istanbul

52 650

160

2011

3 049

Stozice Stadium

Ljubljana 

16 038

43

2010

2 681

AFAS Stadion

Alkmaar

17 023

38

2006

2 232

Hypo Arena

Klagenfurt

31 957

67

2007

2 097

Grand Stade de Tangier

Tangier

45 000

80

2011

1 778

Estadi Cornella El-Part

Barcelona

40 500

62

2009

1 531

New Tivoli

Aachen

32 900

50

2009

1 520

Impuls Arena

Augsburg

49 000

65

2009

1 327

Coface Arena

Mainz

33 500

44

2011

1 313

 

TABLE

The cost of the construction of the recently built stadiums as calculated for one spectator’s seat

 

Source: KPMG

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