Latvians Reclaim Pre-Soviet Property

RIGA, Latvia -- Behind the new coat of pastel-pink paint on its 19th-century facade, the four-story apartment house at No. 1 Ausekla Street is not looking too good.


The mailboxes are battered, the walls are stained, the dim entryway is festooned with dangling wires. The landlord, Uldis Lelis, is apologetic.


"Typical Soviet," he says. But Lelis, 31, swears he will make up for the 50 years his family spent as involuntary absentee landlords.


Last summer, under Latvia's broad restitution program, the family won back four apartment buildings bought by Lelis' great-grandfather, a sea captain, and confiscated when the Soviets occupied Latvia in 1940.


Lelis, a blond, boyish-looking architect who speaks Russian with a heavy Latvian accent, dreams of draping 1 Ausekla's spiral staircase with soft rugs and adorning the entryway with fresh flowers, just the way his late grandmother remembered it from the days when she lived in one of the building's high-ceilinged flats.


But to do that -- not to mention fixing the plumbing, electricity and heating -- he would have to raise the rent far beyond the reach of the people who live there now, mainly pensioners and families crammed into Soviet-style communal apartments.


It's a scenario being played out all across the country, said Vladis Zakis, president of the Association of Real Estate Firms in Riga. Over 1,000 former owners and their heirs have received title to buildings, lands and companies in Riga alone, and 8,000 are awaiting review and will likely receive property in the next few years, he said.


Thousands more have applied for restitution of land plots across the country, said Zigfred Berezovsky, an official at the Central Land Commission, which oversees the program. Application deadlines -- June 20, 1994, for requesting land, December 31 for houses and companies -- have already run out, but former owners may still apply for restitution through the courts.


Neighboring Lithuania and Estonia are also returning property confiscated when the Soviet Union absorbed the Baltic republics and outlawed private ownership.


In Estonia, several hundred farmers have received old lands and tens of thousands more are in the application process, said Janus Varu, Economic Counselor at the Estonian Embassy in Moscow.


Russia has decided that restitution, which would raise countless disputes over property confiscated over 70 year ago, is a can of worms best left unopened.


But in Latvia, where communism held sway for just five decades and many original owners are still living, it has become as integral to government efforts to create a class of private owners as privatization -- and, in some ways, politically preferable.


"In Latvia, there are 800,000 non-citizens," said Zakis. "In Riga, non-citizens make up 65 to 75 percent of the population. If apartments are privatized, most of them will end up in the hands of non-citizens."


By contrast, he said, restitution assures that property will go mainly to ethnic Latvians and others who were citizens of pre-Soviet Latvia, not to those moved in by the Soviet regime.


Latvian Jews who lost property during German occupation and Russians whose ancestors were Latvian citizens have also received property, he said.


The focus on restitution means that Riga is still awaiting a real estate boom like the one which was set off in Moscow when the city allowed residents to privatize their apartments practically for free.


Most apartments in Riga are still state-owned, and renovations are moving slowly because landlords are not allowed to evict tenants until seven years after they acquire title and rent controls keep revenues low.


Lelis said he felt sorry for tenants who know they will have to leave their homes in seven years, but called their eviction an economic necessity.


"If a pensioner has to pay most of his pension for rent and utilities, he thinks he pays a lot -- it's hard for me to explain to him that he pays almost nothing," he said.


"We're not carrying out any repressions here. It's good for them too; they shouldn't have to live in a building that's falling down.


"People say it's not their fault the property was nationalized," he added. "Well, it's not my fault either that 20 people live in one apartment."


For now, Lelis says he is just breaking even on the buildings by renting out storefronts at market price. "It's more for the future," he said. "And it's emotional. We didn't want to refuse our own property."


But, he adds, he is sure the buildings will be worth a fortune by the time he reaches middle age.


"There will have to be a boom," he said. "Or else all these houses will just fall down."