EXPERT COMMENTARY: SITUATION WITH "REPUBLICAN STADIUM" IS INDICATOR OF STAGNATION OF VALUATION MARKET AND ITS REGULATION

In 2022, the government signed a memorandum committing to sell the land of the former Republican Stadium to the United States government for the construction of a new embassy complex. To do so, the asset needs to be appraised. The first tender was announced back in May 2022. However, neither through a competitive bidding process nor through direct negotiations was it possible to find a candidate for the valuation of this asset. Why?

In an exclusive comment to the agency "INFOTAG" explains the president of the Association of Independent Appraisers of Moldova (SEI), Doctor of Economics Galina SELARI.

To evaluate the Republican Stadium is not the most difficult job. The fee offered by the Agency of Public Property (APP) is twice as high (400 thousand lei) as the highest appraisers in Europe or America ask for similar objects. Why, then, does no one want to take the job in Moldova?

Responsibility. More precisely, the blurring of the concept. The way Moldovan regulators understand the process of valuation of state assets and the way it should take place in accordance with international practice are, unfortunately, diametrically opposed.

Today, there are about 130 people working on the valuation market, in the commission that issues certificates and admits to work on the market, there are people who evaluated non-performing loans for the three "burst" banks or contributed to the sale of Air Moldova for next to nothing. There are those who verified them, some of them are already being questioned by the anti-corruption bodies. Their level is high, but far from precise and correct steps. They are used to doing everything "under the covers" so that no one can see, but here there is such a high level of publicity.

By the way, in the terms of reference (for the evaluation of the Republican Stadium) there is a clause on confidentiality. This is complete nonsense. On the contrary, there should be a clause about openness.

The second point is regulation. When the whole world is trying to bring everything into one ball, we are separating. Valuation of real estate and valuation of intangible assets under Moldovan law requires different authorizations. The Republican Stadium is not only a land plot with encumbrances, it is also an intangible asset related to real estate. Because the syntagma "Republican Stadium" is valuable and there are other cultural and historical moments that affect the value.

Third - the legal framework of the evaluation activity in the Republic of Moldova (in particular, the lack of standards) does not allow performing the work in the interest of the budget and in accordance with the international practice.

Now – about the technical part.

Taking into account that the transaction takes place between two countries - Moldova and the USA, the value to be determined should not be market, but fair. This will provide the parties with more room for maneuver in the transaction, to take into account the real utility with the prospect of long-term cooperation, taking into account the significant impact that the future "Republican Stadium" has on the surrounding real estate.

This is the only way to ensure that the future facility (which, according to the new owner, will include not only the diplomatic mission itself, but also a park, i.e. a cultural facility, right in the center of the city) facilitates the maximum flow of transparent investments. This will provide not only material benefits to both parties, but will also create an image of Moldova, which knows how to make profit, and at the same time improve the image of Chisinau through the realization of complex long-term projects. This will be a kind of premiere, in the absence of positive experience in the past.