Chinese and Russian investors plan to open a new, 10,000-square-meter complex near the Vladykino metro station, the first market of its kind since the closing of Cherkizovo in June.
The market will be manned primarily by Chinese merchants and is expected to do more than $1 billion per year in sales, its owners said.
The market — which will be called Charoit and is slated to become operational at the end of 2009 — is planned as a wholesale footwear complex selling products from over 200 Chinese factories, co-owner and managing director Oleg Sumarokov said.
All of the market’s retail spaces have already been subleased to merchants, Sumarokov said.
The project’s main investor is Mikhail Chao, a Chinese immigrant who runs a construction business in the Chita region. The third partner in the complex is Chinese entrepreneur Ju Dzen Liu, Sumarokov said. Liu confirmed his involvement in the project.
Charoit will rely solely on wholesale trade, Liu said.
“The time for ugly forms of trading, such as wholesale-retail markets, is now over. Large wholesale complexes need to be operated separately from retail points,” he said.
With the specter of Cherkizovsky Market still flitting over Moscow, the partners “would not have been permitted to open a market bearing any resemblance to Cherkizovsky,” Sumarokov said.
Traders from Cherkizovsky will not be working at Charoit, Sumarokov said. Footwear will go through official customs procedures and will be sold by companies that are officially registered in Russia, he said.
Rent at the complex is $1,440 per square meter, Ju said.
At current rates, a typical shop renting 50 square meters would pay about $6,000 per month, a price that experts said was on the high side.
Rent at this type of complex should not exceed $1,000 per square meter, said Vladimir Avdeyev, a partner at King Sturge property consultants. Chinese businessmen, however, are ready to pay a premium on rent after Cherkizovsky’s closure, he said.
A visit to the complex confirmed that it was nearing the final stages of construction. Some of the complex’s shops already sported signs.
The complex’s owners said they did not know whether Chinese traders would establish more markets similar to Charoit in Moscow.
It will be the first market built for Chinese traders since the closing of Cherkizovo, said Sergei Sanakoyev, chairman of the Russian-Chinese Center for Trade and Economic Cooperation.