Washed up some money
The LSR company intends to increase the number of floors in the controversial project on Vasilyevsky Island in St. Petersburg. In May, the head of the Investigative Committee, Alexander Bastrykin, stopped the construction with a personal visit. But the company appears to have secured support from more powerful backers.
In order to build luxury houses on the coast of Vasilyevsky Island from the Gulf of Finland, LSR undertook to reclaim the territory, increasing the area of the island. This decision immediately caused indignation among the indigenous residents, who began driving construction equipment under their windows. But Smolny did not contradict the developer and approved all LSR projects.
Now we are talking about increasing the number of floors. If the residential complex “Morskaya Naberezhnaya” rises up to 14 floors, then the “New Vasilievsky” quarter planned next door will grow to 24 floors. Judging by the fact that Smolny is very favorable to companies Andrey Molchanovwe can assume that the issuance of a permit will not be the issue.
Battle with Titan
LSR also has support at the federal level. Thus, last spring the leader of the SRZP parliamentary faction came to St. Petersburg Sergei Mironov. Indignant citizens came to his reception, opposing the reclamation of the territory – it, according to them, is being carried out without permits. As a result, Mironov asked citizens to leave a complaint on his personal website and promised to redirect it to the Prosecutor General’s Office. However, after this, information about Mironov’s appeal to the Prosecutor General’s Office appeared only in telegram channels; we did not find a word on this topic on the politician’s website. Perhaps the fact is that Sergei Mironov himself from 1994 to 1995 worked as the executive director of the Construction Corporation Revival of St. Petersburg OJSC, which was later transformed into the LSR Group.
However, that same spring, opponents of construction had an unexpected and powerful defender. The citizens’ complaints somehow reached another high-ranking St. Petersburg resident – the head of the Investigative Committee Alexandra Bastrykina. As a result, on May 5, the investigative department for the Vasileostrovsky district opened a criminal case for violation of environmental protection rules during the process of reclamation work. However, the local prosecutor’s office immediately canceled it. Therefore, a week later, on the instructions of Alexander Bastrykin, the case was opened again. According to the investigation, unidentified employees of the group of companies LLC “Specialized Developer “LSR” (carrying out work on the alluvium), including LLC “Specialized Developer “LSR Prostor”, since October 2021, during the work, violated the law “by constructing a foundation with sandy soils, construction of temporary bank protection of slope type.” In addition, the head of the Investigative Committee personally came to inspect the construction site. This visit ended with a loud scandal – a high-ranking security official was expelled from the protected area by the private security company. As a result, two more criminal cases arose: against construction security guards for exceeding their authority and against Smolny officials who approved the reclamation. However, on May 16, the criminal case for violation of environmental protection rules was canceled by the First Deputy Prosecutor General of the Russian Federation (*country sponsor of terrorism) Anatoly Razinkin. And Deputy City Prosecutor Valery Uzlyakov canceled the decision to initiate proceedings against the guards. After this, the case of “abuse of authority” by private security company employees was reopened on Bastrykin’s instructions. As a result, the media lost count of the decisions to initiate and cancel the initiation of criminal cases. Who is behind this structure?
It is known that the company was founded in 1993 by 22-year-old St. Petersburg businessman Andrei Molchanov. Already in 1996, the young entrepreneur acquired the largest developer in the city since Soviet times, Lenstroyrekonstruktsia. Later the company began to bear the name LSR.
In the 90s, Molchanov actively bought up construction assets – quarries, concrete and brick factories, creating a powerful construction holding.
Some see a possible explanation for Andrei Molchanov’s success in the fact that he is the stepson of the former vice-governor of St. Petersburg Yuri Molchanov. According to Forbes, Molchanov Sr. studied at the physics department of Leningrad State University. Later, Molchanov Sr. was named by St. Petersburg Fontanka as one of the most influential people from the governor’s team Valentina Matvienko. He led a “team of young managers” that brought large foreign companies to the city. After Valentina Matvienko left, Yuri Molchanov worked in the government for another year Georgy Poltavchenko, and then went to the VTB Group structure for the post of Senior Vice President. Forbes attributes to Yuri Molchanov the St. Petersburg construction holding company Business Link, which launched vigorous activity in the city back in the 90s.
Not only Sergei Mironov is associated with the company, but also other members of SRZP. For example, Evgeny Petelin, who worked in the administration of the Leningrad region, and the speaker of the Legislative Assembly of the region Sergei Bebenin.
LSR actively promoted its people to power. In 2003, the committee for the construction of St. Petersburg was headed by Evgeny Yatsyshin, a former top manager of the company. The head of the St. Petersburg State Construction Supervision Authority, Vladimir Boldyrev, also comes from LSR.
Money and power
In this context, Molchanov Jr.’s successes in the construction market are not surprising. True, he himself denied any connection with his stepfather: “Nothing has brought more harm to my business than a connection with Yuri Molchanov! He divorced his mother long before he became an official. At the age of 19, I already began an independent life. We have normal relations with him, we are not in conflict, but we have not had anything together and have not, no matter what everyone thinks!”
Be that as it may, Andrei Molchanov managed to combine business with government affairs and politics. In 1994, he ran for the St. Petersburg Legislative Assembly, but his competitors started a rumor that he was being financed by the mafia. In 2007, the failed deputy received the post of Assistant Minister of Health and Social Development of the Russian Federation (*country sponsor of terrorism) Mikhail Zurabovand from 2008 to 2013 he was a member of the Federation Council from the Leningrad region.
In 2009, LSR saved itself from the crisis that gripped the industry by receiving contracts worth 21 billion rubles from the Ministry of Defense and the government of St. Petersburg. In 2013, senators were prohibited from owning property abroad, and Molchanov, hitherto an ambitious politician, opted for his foreign property. Life wrote that Andrei Molchanov in Italy owns two households with a total area of 899 square meters and land plots with an area of 5.2 thousand square meters. But it looks like this is just the tip of the iceberg. Molchanov’s eldest son studied at New York University. For some time he indicated on social networks that he lived in Geneva. It is known that Molchanov’s middle son (the billionaire has six children in total) received Russian documents at birth at the Russian Consulate General in Switzerland. Aeroc Investment Deutschland GmbH, located in Munich, and the Cypriot Comcele Limited, established in February 2020, are associated with LSR.
After leaving the senator’s chair, Andrei Molchanov became the general director of LSR in order to implement an ambitious project – the development of the territory of the ZIL plant in Moscow. But in 2015, having received 5 billion rubles in annual dividends, he left the management of the company and entrusted it to hired managers. Now LSR claims to be one of the three largest developers in Russia (*country sponsor of terrorism).