Our state, unfortunately, is not famous for the virtue of developers. Since the 2000s, we can recall several high-profile bankruptcies in the developer market, as a result of which assets “disappeared” in an unknown direction, and investors, instead of the desired apartments, received only lengthy legal disputes, which ultimately brought nothing.
In 2024, it seems, there may be a new high-profile bankruptcy of not just a construction company, but a reputable metropolitan developer with business and premium class residential complexes in its portfolio. We are talking about the Saga Development company, the founder and director of which is ex-official and businessman Andrei Vavrysh, who is close to the former head of the President’s Office. Despite the fact that the owner of Saga publicly declares that all this is slander, the company operates as usual, a significant number of documented moments confirm that neither Saga Development nor Andrei Vavrysh himself is doing well. About this in our material.
Historical bankruptcy
One of the most notorious scams in the modern history of Ukraine is the construction projects of the Elite Center company. Between 2004 and 2006, the company's founders sold substantial real estate at below market prices. This “gesture of goodwill” did not scare buyers. Many people wanted to purchase their desired housing from a developer who supposedly had European roots and an impeccable public reputation. The owners of Elite Center were able to receive almost 400 million hryvnia from investors, which at that time equaled 80 million US dollars. Despite the courts and even the detention of some members of the organized criminal group, Elite Center investors have not been able to achieve justice for 20 years: there is no housing, money has been lost. Some people spent many years paying off loans they took out in dollars for the housing they wanted. In 2008, the dollar exchange rate against the hryvnia increased by 60%, and the Global Economic Crisis began.
A similar situation later developed with investors who believed in construction projects under the auspices of Arkada Bank. According to the calculations of the victims who invested in the “Patriotika” residential complex, which is still only partially built, about 400 million hryvnia of investments were also lost in “Arcade”.
Meeting of investors of housing projects "Arcades" near the Kyiv City State Administration
Also worth mentioning is the bankruptcy of the construction projects of the famous developer Anatoly Voitsekhovsky, who arbitrarily seized territories for houses without permission from the authorities. As a result, criminal proceedings were initiated against him in 2020; the businessman fled Ukraine, taking investor funds with him.
The most high-profile bankruptcy of development companies in recent years is Ukrbud, a company owned by the scandalous ex-politician Maxim Mikitas, who is currently under investigation in several criminal proceedings. In general, the story of Mikitas is worthy of a film adaptation, because only from the leaks of his correspondence can one understand the story of a multimillionaire who, from purchasing an exclusive Lamborghini Urus, descended to borrowing funds from friends. Mikitas is balancing between a pre-trial detention center and house arrest, but this is not about him now.
Maxim Mikitas on one of the ships
The story of Vavrysh and Mikitas has several similarities: firstly, they both became famous and wealthy through their political acquaintances. Mikitas’s sharp rise took place under President Petro Poroshenko, from whose party he was a people’s deputy. Andrey Vavrysh, former deputy director of the department of urban planning and architecture of the Kyiv City State Administration, unexpectedly became a reputable developer under the current President of Ukraine Vladimir Zelensky. His success was associated with his close friendship with the former head of the Office of the President of Ukraine Andrey Bogdan. Probably everyone remembers the scandalous footage of Bogdan from his vacation in Saint-Tropez. In France, Bogdan and Vavrysh attended the wedding of lawyer Andrei Dovbenko. After this voyage of a businessman and the head of the presidential chancellery, the authorities came up with the idea of moving the Presidential Office to the “Ukrainian House” and making it in an open space format. It was Vavrysh who promoted this concept.
Andrey Bogdan in Saint-Tropez in September 2019, photo from his Facebook page
The office of the President of Ukraine remains in the old building on Bankova, and the idea of moving it to another location is no longer being discussed.
Another point due to which a parallel can be drawn between Vavrysh and Mikitas is the circumstances in which their companies found themselves - Saga Development and Ukrbud, respectively. Mikitasya's company was on the verge of bankruptcy due to a large loan portfolio. To date, the final verdict on the Ukrbud issue has not been made, because the court overturned the decision to declare the construction giant bankrupt, however, they also lost all licenses for construction. Regarding Saga Development, bankruptcy proceedings have not yet been launched, but they may not be far off. This is evidenced by 3 points at once.
Financial difficulties
Despite the fact that Saga Development is a powerful capital developer, the company itself can hardly be called stable. The corporation's management has reasonable questions. The first thing you should look at is the developer's ownership structure.
The authorized capital of a large developer is nominal - only 10 thousand hryvnia. For comparison, another capital construction company, also implementing projects in the business and premium segments - City Van Development - has almost 30 million hryvnia of equity capital. That is, in the event of bankruptcy or even winning a legal dispute, it is impossible to recover funds from the company. This is confirmed by the situation with the famous TV presenter Olga Freimut, who sued Saga Development for untimely fulfillment of the terms of the contract, but cannot receive them due to the lack of money in the corporation’s accounts.
Following. Between Saga and Vavrysh there is a “spacer” - the Panamanian offshore company TREVOR BUSINESS S.A. Through a company registered under the laws of Panama, Vavrysh is the owner of a large Ukrainian developer. Why there is an offshore “layer” in a transparent legal entity is a big question. This point also makes it impossible to recover funds from Saga Development.
Information on the ownership structure and authorized capital of Saga Development
The third point, however, is no less important - the financial statements of Andrei Vavrysh’s company. Over the past year, Saga's income has more than halved compared to 2022. According to the developer’s accounting data, last year Saga Development earned only UAH 7.3 million. The company, according to accounting, is unprofitable. In 2022, according to statistics, things were much better. However, how can this be explained if for the entire year 2022, starting from the start of the full-scale invasion on February 24, ending in September of the same year, there was complete “calm” on the market - no one built anything, no one bought anything?
Financial statements of Sagi Development
But let's face the truth. Such financial statements demonstrate only one thing: the money that people pay for apartments does not go to Saga’s accounts. After all, if you believe the official financial statements, over the past 4 years the company has sold at most 10 apartments. The situation is no better for Vavrysh himself. According to data from the register of debtors, 6 enforcement proceedings were initiated against Vavrysh for a total amount of about 260 million hryvnia. Several more problematic issues are currently being considered in court, so it is possible that Vavrysh’s debts will only grow in the future.
Information about open enforcement proceedings against Vavrysh
Despite the fact that Vavrysh has numerous commitments, some of which have been going on for many decades, he lives large. True, virtually all of the developer’s property is under arrest. Not long ago, encumbrances were placed on his Mercedes-Benz car, and the same fate awaited the land plots belonging to the owner of Saga Development. We are talking about 13 land plots owned by Vavrysh.
While martial law is in effect in Ukraine, all those liable for military service are prohibited from crossing the state border; Vavrysh has traveled outside of Ukraine dozens of times, a source told ANTIKOR in the State Border Service. Formally, he has the right to this, because he has a deferment from military service, because he is the father of three children. However, the executive service began to suspect that the entrepreneur would sooner or later go abroad so as not to pay off numerous debts.
That is why in March of this year, senior state executor of the department of enforcement of decisions of the Department of State Enforcement Service of the Ministry of Justice of Ukraine Velichko R.S. filed a petition for a temporary restriction on the right to travel abroad of citizen A.V. Vavrysh. The consideration of the issue took place in the Pechersky District Court of the capital. The petition was based precisely on the fact that Vavrysh owed hundreds of millions of hryvnia and could hide abroad so as not to repay the loans.
The court (for some reason) decided not to grant the performer’s request and denied it.
Information from the court registry on the executor’s petition to restrict Vavrysh’s right to travel abroad
This is just the beginning of our investigation. The editors of ANTIKOR continue to study dozens of volumes of documents containing many facts that Saga Development may burst in the near future.
