Employees in Russian companies are not ready to relocate along with the offices.

Companies are moving from one business center to another, changing neighborhoods, districts, or even relocating to other cities in Russia. Employees who have rented housing closer to work should logically follow the office by vacating the occupied apartments. But Moscow realtors say that the rental housing market hardly notices such movements. Even in Gazprom, the management does not expect that when the corporation moves from Moscow to St. Petersburg, most of the employees will leave. Earlier, Interfax reported that when some divisions move to St. Petersburg, a possible loss of 50% of the staff who did not indulge, to use the expression of Alexey Miller, Chairman of the Gazprom Management Board, in the "raw tasty air" of the Northern Palmyra, is considered the norm. Practice shows that if the new office is also within Moscow, then employee-tenants rarely change their place of residence. "After our move to Moscow City from Belorusskaya (White Square Business Center)," says Ekaterina Prokopova, Head of Public Relations at CBRE, "only a couple of employees moved closer because their previous lease was over. Several other people (secretaries, a coordinator of one of the departments) quit: it became inconvenient for them to get to the office, and they did not have money to change housing." It is also important that a significant proportion of employees of Moscow companies have their own housing in the capital. If a company moves from the center of Moscow beyond the Moscow Ring Road, the loss of employees increases. "In this situation, about 70% of employees are more likely to change the company itself," says Evelina Ishmetova, Director of Consulting and Development at Key Capital. Top managers and heads of departments remain, and middle and lower-level employees are hired locally: it is often cheaper, and they usually already have housing, she says. As Vedomosti already reported, when moving to Country Park in Khimki, at the intersection of Leningradskoye Highway and the Moscow Ring Road, up to 20% of line employees are dismissed from companies: it is inconvenient for them to travel outside the Moscow Ring Road. According to observations by Kalinka Group, top management of large corporations moves to a new location almost in full. They can afford to buy or rent housing. For example, when moving to Moscow City International Business Center, some managers did just that, as there are many apartments available for sale and for rent in skyscrapers. According to Kalinka Group, apartments with a total area of ​​81-523 square meters in the Mercury skyscraper (completed in 2013) cost an average of $ 9,841 per square meter. In the Moscow International Business Center (completed in 2015), apartments with finishing and a total area of ​​71-295 square meters can be purchased at a price ranging from $ 7,473 to $ 11,257 per square meter. On average, for maintenance in skyscrapers, you pay 200-240 rubles per square meter per month. Points of Attraction Currently, according to Kalinka Group's estimates, 20% of tenants of apartments in the Moscow City International Business Center are employees of companies based there. And demand is increasing by 10-15% per year. However, Ekaterina Rumyantseva, Chairman of the Board of Directors of Kalinka Group, clarifies that only those who are interested in the "city lifestyle" for themselves and their families agree to move to skyscrapers following the office. "The business center is a special ecosystem, and if a family is used to living, say, on Vorobyovy Gory with a view of the park, then an environment of high-tech skyscrapers can be an unacceptable option for them," explains Rumyantseva. "Conversely, for some of our clients, moving to the city closer

From Moscow to St. Petersburg

The relocation of companies from Moscow to other cities is rare. More often, regional players move to the capital. However, in 2008, the Constitutional Court of Russia moved from Moscow to St. Petersburg, and the Supreme Court is next in line. One of the most well-known examples in recent years is the relocation of Gazprom. However, the building on Nametkina Street in Moscow will remain under the company's ownership. The offices of the holding's subsidiary companies will move there, as well as Miller's reception and so on. In St. Petersburg, the 86-story Lakhta Center complex will be completed in 2018, and for now, the gas monopoly occupies space in leased business centers, including the Class A Fort Tower on Moskovsky Avenue.

According to Interfax, on March 17th, Miller announced that two-thirds of Gazprom's administration had already moved to St. Petersburg, and the remaining administration would move soon. This is a significant and desirable client for the real estate market in St. Petersburg. Marina Shekera, the Director of the Rental Department at Penny Lane Realty, says that this corporation usually did not rent accommodation for its senior employees but owned apartments for top managers near its offices. It is likely that, as in the capital, apartments will be purchased for top management in St. Petersburg. As for regular Gazprom employees, they independently resolved the issue of renting apartments in the capital. As reported by Vedomosti, the departments responsible for construction and procurement were the first to move to the northern capital in 2013. As a relocation allowance, employees who agreed to move were given an additional two to three monthly salaries for housing rent.

Rental rates in St. Petersburg are lower than in Moscow. For example, a 220 square meter apartment with high-quality finishes in the city center would cost 400,000-500,000 rubles per month, whereas a similar level apartment in Moscow, not necessarily in central areas, would cost at least 800,000 rubles per month, as stated by Rumyantseva.

A Drop in the Ocean

According to Anastasia Mogilatova, the CEO of Welhome, more apartments have recently appeared on the rental market around the "Novye Cheryomushki" metro station, with prices ranging from 70,000 to 200,000 rubles per month. It is traditionally believed that the main tenants in this area are Gazprom employees and its subsidiary structures. However, realtors say that the departure of prestigious tenants did not cause an oversupply and a decrease in rental rates in this area; renters quickly found tenants for the available housing. Mogilatova explains that there are many business centers located in the Southwest District, such as Cherry Tower, Lotte Plaza 2, 9 Acres, Gas Field, Gazoil Plaza, Smart Park, Neo Geo, and others. Moreover, since the subsidiary companies' offices are moving to Gazprom's headquarters, they also need somewhere to live, preferably near their offices.

Zhukova from Miel-Rent believes that corporate relocations cannot affect the rental market in Moscow. According to her calculations, 200,000 flats are rented/sold annually in the capital. Even if 150 or 1000 employees of a particular company rented accommodation in Moscow and now it is being vacated, it is still a drop in the ocean compared to 200,000. In addition, the relocation of a large company takes a lot of time. Zhukova shared that one large company, which was opening its head office in Moscow, turned to Miel-Rent for assistance in finding housing for its employees. The work started in February 2016 and is still ongoing, as the employees of this company are still moving from another city.

In St. Petersburg, the situation is similar, continues the Director of Miel-Rent. "Even if 1000 people suddenly start looking for a place to live, considering the available stock of housing for rent, it will not fundamentally change the market," she says.