Wooden anniversary of 'digital city': what done in Innopolis in five years
One hundred and fifty residents and about five thousand inhabitants have come to Tatarstan's 'Silicon Valley' in five years
Five years ago, Dmitry Medvedev and Rustam Minnikhanov inaugurated Innopolis — “the Tatarstan science city”, conceived as Russian “Silicon Valley” or, as stated on the website of Innopolis, “the IT capital of Russia”. Realnoe Vremya tried to figure out which of the ambitious plans announced at that time have come true, which have transformed, and what Innopolis has actually become.
Who “fills” Innopolis
“I am sure that many thousands of new modern innovative products in the field of science and technology will be created here," then Russian Prime Minister Dmitry Medvedev said at the opening of “the city of the future”. Minister of Digital Development, Communications and Mass Media of Russia Nikolay Nikiforov specified: the full population of Innopolis by residents should be completed in five to seven years.
President of the Information Democracy Foundation, Ilya Massukh, then formulated the main tasks for the development of Innopolis in just two sentences: to fill the built structure with innovators who are able to set up production and ensure its sale, primarily on the domestic market.
“Today, 97 resident companies and 18 partners work in the Innopolis special economic zone," Renat Khalimov, the director general of Innopolis Special Economic Zone, told Realnoe Vremya. “Not so long ago, the order of President of the Republic of Tatarstan Rustam Minnikhanov introduced the status of a startup for companies applying to the SEZ. Since December 2019, four selections have been made and 39 startups have been accepted. Thus, 154 companies are currently operating in Innopolis SEZ.
Success belongs to those who have already become leaders
“Residents and partners of Innopolis special economic zone can be divided into four categories," Renat Khalimov answered the question of Realnoe Vremya about the residents of the SEZ. “First, these are the development centres of the largest corporations in the Russian Federation. The companies such as Sberbank, Yandex, MTS, X5 Retail Group, and Magnit have opened development centres in Innopolis and are helping to digitally transform their businesses. Besides, we have the leading developers of domestic software. For example, Innopolis developed the first Russian mobile operating system Avrora with a high degree of data protection, which allows it to be used in government institutions. New Cloud Technologies company has developed office software for corporate communications and document management. Its clients include large Russian organisations, and in 2019 an agreement was signed to supply MoyOfis software solutions to a number of African countries.
The third category of companies operating in the SEZ, according to Khalimov, is developing, but already proven residents on the international market. For example, Soramitsu Labs, which developes Bakong digital payment platform for the National Bank of Cambodia, designed for 18 million users. It was put into pilot operation in July 2019, the source of Realnoe Vremya specified. Innosoft company with the project of Yorso web platform, whose users are clients from China, Ecuador, Morocco and other countries. Infomatika, a company that signed a contract in Qatar in July 2019 to supply a system for controlling audience access to the AL Rayyan stadium, which is being built for the 2022 World Cup. Provectus Labs, whose application Worker Safety, which uses machine learning algorithms to detect inconsistencies in safety techniques at manufacturing and construction sites, is used by some American oil and construction companies. The Visiology platform developed by the resident of the SEZ, Visiology Technologies, for data collection, analytical processing and forecasting in business and public administration has been used in Nizhny Novgorod Oblast since April 2020 by the Regional Management Centre.
The SEZ CEO stressed that the development of the Innopolis resident — IVKS company — the IVA MCU video conference platform was provided free of charge by the owners to the ministries and major enterprises of the Republic of Tatarstan to work on the implementation of measures to combat coronavirus.
He also listed residents-international companies: Schneider Electric, IBM, Portavita, NNG.
“In total, companies registered in the special economic zone Innopolis created 3,400 jobs," said Renat Khalimov. “Residents and partners of the SEZ invested 16,9 billion rubles as of December last year, and in 2019, investments were made almost twice as much as in all previous years.
Booking as a way to fill the rental space
Today, as follows from the presentation posted on the official website of Innopolis, 95% of the rental space in the Popov Technopark is occupied by residents. If you look on this same website section, which offers space for rent, then there is a slightly different picture: on the first seven floors only five small rooms are rented — no more than 20% of the area, almost all area is occupied on the second and third floors, on the fourth and fifth about half of the areas is rented, and the rest is “booked”, that is probably vacant than occupied. On the sixth floor, about 90% of the space was rented, on the seventh — about 20%, the rest of the area is divided equally into free and reserved.
However, answering the question of Realnoe Vremya how much Innopolis is filled with residents today, and the technopark of Innopolis — Popov ADC — by tenants, Director General of Innopolis SEZ JSC Renat Khalimov called other figures:
“At the moment, the occupancy rate of the Popov Technopark is 87 per cent. Another 10 per cent of office space is reserved under preliminary cooperation agreements with companies that intend to apply for a resident or partner status in 2020. Startups can rent an office or work space in the coworking on preferential terms.
When asked whether it is planned to expand the rental area and at what expense, Renat Khalimov said that work is underway on the construction of a second technopark on the territory of Innopolis, which will bear the name of N.I. Lobachevsky — a total area of 30,000 square metres:
“The completion of the work is planned for the end of 2020. We are already being approached by companies that express interest in moving to Innopolis after the opening of a new technopark designed for 1,500 jobs.
Khalimov said that the most promising projects for the development of Innopolis were presented to President of Tatarstan, Rustam Minnikhanov:
“Together with Rosenergoatom Corporation, a roadmap for creating a data processing centre has been approved. Within three years, Innopolis SEZ is also planning to build a logistics centre and the first robotic hotel in Russia, an industrial park and an industrial valley, where companies will develop projects in the areas such as biomedicine, drones, new materials, microelectronics and industrial robotics.
Since Realnoe Vremya wrote about the lawsuits of the ministry of communications against Innopolis residents — Govermedia Incorporated, Dom Bobra and CI Connect -initiated in connection with their violations of the agreement on technical and implementation activities in the special economic zone, the number of such violators has doubled. According to the website of the Arbitration court of the Republic of Tatarstan, similar claims were filed against Level 90 LLC, Yuridichesky Intellekt JSC, IMC PLC.
Besides, Innopolis Special Economic Zone JSC is currently collecting debts from misfortuned residents through the court for renting premises in the Popov Technopark. For example, FM Razrabotka PLC for an office area of 115,8 square metres owes, including penalties, almost 886,000 rubles, IMC PLC — about 350,000 rubles, Uroven 90 PLC — about 120,000 and so on. On June 2, the last claim was received as of today — to to ITBS Development, the amount of claims — more than 668,000 rubles.
The arbitration court of Tatarstan satisfies these claims almost automatically, but what's the point? It is not a problem to evict the defendants, as requested by Innopolis. And what can they take, for example, from IMC PLC, which ended 2018, according to Spark-Interfax, with a net loss of 1,33 million and since August 2019 is on the verge of bankruptcy?
Or with Uroven 90 PLC, which ended 2017 with a half-million loss and since this very year has not produced any products (it specialises in creating computer programmes)? By the way, the owner of the latter company is the co-owner of Dom Bobra PLC, which also acted as an unsuccessful resident of Innopolis. On June 2, the Arbitration court of the Republic of Tatarstan declared FM Razrabotka PLC bankrupt.
The arbitration court of Tatarstan ten times reduced the amount requested by the minsitry of digitalisation of Tatarstan for breach of contractual obligations with another resident of Innopolis — GoverMedia Inc PLC, with 14,4 million rubles to 1,44 million, but the Verkhneuslonsky bailiffs cannot recover this money from last July.
Tellingly, it was not possible to talk about the reasons for the unsuccessful call to Innopolis, which cost so much to the special economic zone, with the heads of the above-mentioned enterprises: the phones of the resident losers were not found in the public domain or they were disabled.
“Agreements with a number of resident companies were terminated due to their failure to comply with the terms of the trilateral agreement during the procedure for obtaining resident status," says the SEZ's CEO Renat Khalimov. “The reasons why companies were unable to operate were various. It is necessary to understand that companies that come to Innopolis are often technology startups. And the survival of technology startups even in the conditions of support from the special economic zone can not be one hundred percent.
He pointed out that the total number of terminated agreements is significantly lower than the number of companies registered in Innopolis SEZ during this period:
“In 2019, 24 companies started working in the special economic zone, and 12 more received the status of a resident or partner in April 2020.”
“People at work”
Visitors to Innopolis are surprised by its desolation, but the press service of the city hall reported that there are about 4,600 people in the city during the day, 3,600 of them live there permanently. Residents include 700 campus students and 270 high school students, the latter located in a closed area.
The city, according to the press service of the mayor's office, comes to life in the evenings, after 6 p.m. — the rest of the time its inhabitants work in offices or study. The average age of residents is 28,5 years, so only mothers with children walk during the day, and there are not many of them here yet.
“Now the city has 22 apartment buildings for 1,572 apartments," said the head of the press service of the city hall of Innopolis, Liliana Sayfetdinova. “Of these, 1,426 apartments are occupied. In the residential complex Zion, 21 houses with 168 apartments have been built. All these apartments are sold. Now in the residential complex Zion is beginning to build the second stage of the complex.
Initially, it was assumed that by 2030, Innopolis will have 155,000 inhabitants, but a year after the first residents settled, the mayor's office refused to make specific plans for a specific date. Since at that time there were only about 2,000 people who wanted to live there. And judging by today's figures, the population growth rate of Tatarstan's 'Silicon Valley' has remained low since then.
Rental housing: cheap and cheerful
Further development of Innopolis is also under question, at least large-scale one. It was slowed down by low rental prices, which the first CEO of Innopolis SEZ, Igor Nosov, proudly spoke about at the Moscow urban forum — 7-10 thousand rubles for an apartment (not counting housing and utilities fees).
Territory-Innopolis PLC, Moscow, bought two houses from the State Housing Fund — a total of 105 apartments to rent them for 22-27 thousand rubles a month. However, Moscow prices in the Tatarstan “city of the future” did not work out. Realising that neither residents nor employees can be lured here by such “affordable” housing, the government of the republic halved the rental rate.
And Nota Bank, which was supposed to issue a loan to Moscow residents who were going to buy 800 apartments, lost its license, and funding stopped. The project failed in the bud. Today, Territory-Innopolis PLC is bankrupt, according to Spark-Interfax, its debt to creditors exceeds 744,6 million rubles, and almost 267,4 million more — unpaid debts on loans. And the company's property, according to an independent assessment, cost only 317,22 million rubles, and this property — 85 apartments in the house number 114 on Sportivnaya Street.
For those who agree to move
Among those who were five years ago at the opening of Innopolis was the interlocutor of Realnoe Vremya, Matvey Alekseev, who then held the post of the director of external communications at Rambler&Co.
“Now I am engaged in other work and could not track that project, but I often visit Innopolis," he says. “The last time I was there was last year. The city has changed, grown a lot and has really become a platform for implementing innovative ideas.
But Innopolis, in his opinion, can really pay off as a result of the coronavirus pandemic, which has shown how many specialists can work effectively on remote sites. In his opinion, Tatarstan's 'Silicon Valley' may be of interest to companies that benefit from renting office space for such employees (who agree to move to the “hinterland”) at lower prices away from Moscow. Again, it professionals who agree to move, many of whom prefer to live away from megacities and closer to nature but would like to live in comfort without paying too much for it.
“Do you think it makes sense to try to build housing in Innopolis now according to the plan, bearing in mind the future population of 150,000?" Realnoe Vremya asked.
“Building a city is not a quick process. It depends on how investments will be received in the future, on how the infrastructure will develop," Alekseyev issued a cautious forecast.