2023-10-24 17:26:29
Vienna (OTS) – Investor group DBR is withdrawn from responsibility for the long-distance bus terminal project
Wien Holding does not allow additional costs to be passed on to taxpayers
The investor group DBR – Donau Busterminal Realisierung GmbH (Dr. Ariel Muzicant and Dr. Markus Teufel), which emerged victorious in an EU-wide competition, has been stripped of responsibility for the construction of the new international long-distance bus terminal in Vienna Leopoldstadt by Wien Holding.
This is done by terminating the construction concession agreement (BKV) concluded in 2021, which regulates the interaction between the City of Vienna, represented by WH Fernbus-Terminal Projektentwicklung GmbH (WH Fernbus-Terminal), which is part of Wien Holding, and the investor group DBR. The termination was served on the DBR today, Tuesday, October 24, 2023.
The DBR had the task of implementing and financing the project under the conditions agreed in the tender and within an agreed period of time with construction starting in 2024 and completion at the end of 2027. The project consists of the long-distance bus terminal and a 105 meter high-rise structure above it Hotel or office use.
A long-distance bus terminal will definitely be built
The construction of Vienna’s central long-distance bus terminal remains the highest priority for the City of Vienna and Wien Holding. In the future, it will be the third strong pillar of long-distance passenger transport alongside the airport and Vienna Central Station. It is therefore clear that the long-distance bus terminal project will definitely be implemented – even in difficult times in terms of real estate.
At the WH long-distance bus terminal, concrete plans are currently underway to implement the long-distance bus terminal without the DBR. The manner in which the project will be implemented will be decided by the turn of the year and will then be started as quickly as possible. The start of construction, originally planned for the middle of next year, will be delayed accordingly.
The operating company BGR Busterminal GmbH, consisting of the companies Blaguss, Gschwindl and Dr. Richard, will ensure an optimally managed long-distance bus terminal as planned.
Irreconcilable differences
WH Fernbus-Terminal Projektentwicklung GmbH takes this step of terminating the contract due to the existence of important reasons defined in the construction concession contract that make a continuation of the contractual relationship unreasonable. In addition, there are also irreconcilable differences regarding the project implementation goals.
These differences arose in May 2023 in connection with the unjustified termination of the construction concession contract by the investor. DBR justified this step with the high inflation rate, the sharply rising construction costs and the collapse of the market for real estate investments by institutional end investors. However, the DBR then withdrew this termination in July 2023 as “invalid”.
In order to possibly resolve the differences, it was agreed that there would be appropriate discussions and negotiations with the DBR over a maximum period of six months. However, this pause for reflection took place without any rapprochement between the contracting parties.
The investor is not willing to implement the project quickly and in accordance with the contract
DBR demands that the City of Vienna assume the full risk and additional costs
Although WH Fernbus-Terminal Projektentwicklung GmbH has created all the prerequisites for a successful project implementation, the investors still lack the willingness to implement the project quickly and in accordance with the contract.
The investor group DBR – citing the difficult situation on the real estate and financial markets – continued to pursue the goal of passing on the risk and additional costs to the city of Vienna or Wien Holding. Although it is contractually agreed that such risk and the associated costs must be borne by the investor.
As part of the project development by DBR, due to the investor’s extensive changing plans and the current real estate crisis, the situation has arisen that the project is simply no longer viable for DBR in this further developed and modified form. DBR is now trying to play for time in the hope that the real estate situation will improve in the next few years. DBR wants to transfer the resulting risk and additional costs to the city of Vienna, which Wien Holding, as a public sponsor, must under no circumstances allow.
Some of the many examples of this:
In this sense, the DBR is still unwilling to sign the negotiated and ready-to-sign building lease contract and pay the agreed advance building rent, despite repeated requests, even though it would have been obliged to do so since July 14, 2023.
The DBR only wants to begin construction of the long-distance bus terminal (contractually agreed with the DBR was that construction would begin in mid-2024) when the ECB’s key interest rate falls below 300 basis points. Nobody can currently estimate when this will be the case. In the event that the key interest rate does not fall, the DBR demands a right of withdrawal and reimbursement of the costs incurred and interest paid up to that point by the City of Vienna or the WH Fernbus-Terminal.
With regard to all upcoming approval procedures, the DBR requires that the WH Fernbus Terminal must ensure that no objections are raised by the City of Vienna or its associated bodies (authorities, companies, companies). The DBR wants a “clearance” from the authorities so that the project can be waved through. The DBR also wants to pass on the costs associated with official requirements to the city of Vienna.
The investor also does not accept the contractually agreed valorization of the building interest. A “little detail” to sprinkle on: The DBR also wants 300 parking spaces with guaranteed availability in the Stadium Center, although this was never contractually agreed.
Wien Holding does not allow additional costs to be passed on to taxpayers
Wien Holding and WH Fernbus-Terminal will not allow the additional costs caused by the investor and his demands to be passed on to taxpayers. The WH long-distance bus terminal does not want to and will not meet the investor’s demands. Not least because this would mean so-called “significant contractual changes”. However, such contractual changes are not permitted because competition law does not allow subsequent, significant changes to the tender conditions of a procurement procedure.
At the same time, the lawyers at WH Fernbus-Terminal are also examining possible claims for damages from the DBR.
Questions & Contact:
Wolfgang Gatschnegg
Wien Holding – Group spokesman
T: +43 1 408 25 69 21
Mobil: +43 664 82 68 216
E: w.gatschnegg@wienholding.at
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