The real estate developer Hanner is taking over the construction of the National Stadium in Vilnius. The original concessionaire, managed by the investment fund BaltCap, has passed on the project amid an embezzlement scandal.
The announcement about the change of developer for the National Stadium was made on Friday by Vilnius Mayor Valdas Benkunskas.
“The main piece of news we would like to announce is that the BaltCap fund is pulling out of the project and is being replaced by the well-known company Hanner. We have an agreement in principle between Hanner and BaltCap on the transfer of shares. A draft contract amendment and indexation will be presented at the next Vilnius Council meeting in February,” said the mayor.
Under the new contract, Benkunskas said, the project partners – Vilnius Municipality and the Ministry of Education, Science and Sports – have agreed to expand the would-be stadium’s seating capacity from 15,000 to 18,000. This will make it the biggest stadium in the region, bigger than similar facilities in Kaunas, Riga, and Tallinn.
Earlier this week, the business daily Verslo Žinios reported that BaltCap was looking for another investor for the project, possibly to take it over completely.
The project started to stall last year after it became apparent that it would be significantly more expensive than originally planned. BaltCap then appealed to Vilnius Municipality asking to index the construction cost and halted construction works.
This happened around the same time as BaltCap fired one of its managers, Šarūnas Stepukonis, who is now being sued for over 16 million euros he allegedly embezzled from the fund and gambled away in a casino.
BaltCap has insisted Stepukonis’ actions did not cause any damage to the National Stadium project.
Forty-percent inflation of construction costs
Mayor Benkunskas said the construction costs had increased by 40.35 percent between January 2020 and July 2022. Of the increase, 28.71 percent will be covered by the city and the ministry, with the remaining 11.64 percent to be borne by the concessionaire, which will cover it from its own working capital and the profits it will make.
“It is not the case that only the municipality and the ministry are being asked to cover the entire price increase, this burden is shared,” said Benkunskas.
Gintautas Jakštas, Minister of Education, Science and Sport, said that the cost of the improvements to the project had not yet been finalised and was still awaiting a decision from the Ministry of Finance: “We believe that there should be no objections.”
Arvydas Avulis, the CEO of the new concessionaire Hanner, said that the stadium is expected to open in 2026, a year later than originally planned.
“We have responded to requests and invitations, and we will take this work responsibly. I think we have enough experience, financial resources and I think we will have the stadium ready in 2026 to play football,” Avulis told the press conference.
Troubled project
Constructing a stadium in the Šeškinė neighbourhood of Vilnius has been a decades-long endeavour. The initial construction started in 1987 and stopped six years later. In 2008, a further 33 million euros were invested into the project.
In 2015, the project was interrupted again after the Public Procurement Office declared its tender illegal.
Whatever had been built on the site was demolished in 2022 and a permit for the construction of a new stadium was issued in May 2023 to Vilniaus Daugiafunkcis Kompleksas, a company owned by BaltCap Infrastructure Fund.
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