Tallinn will continue to seek private sector partners for the reconstruction and deployment of the Tallinn Linnahall, the City Concert Hall. Launching a call for tenders will be decided once the market situation improves.
According to Tallinn Deputy Mayor Andrei Novikov, the city will continue to prepare the terms and conditions of the tender for the partner. "We will continue to seek partners for the reconstruction of Linnahall. We are working to find potential partners, as well as to follow up with those who have expressed interest in this project," Novikov said. "At the moment, it is difficult for both a potential private investor and the city to predict the size and timing of the investment needed. Therefore, we will decide launching a call for tenders to find a private sector partner for the reconstruction and commissioning of the City Concert Hall when the market is more favourable."
The City Government decided at its meeting on Wednesday that the preparation of selection procedures and conditions for the reconstruction and deployment of the Tallinn Linnahall will continue until the construction market stabilises.
In February this year, following a public procurement, the city-owned AS Tallinna Linnahall signed a contract with the business advisory firm KPMG Baltics OÜ to gather information from potential investors and financial institutions to find a partner for the reconstruction of Linnahall, and to advise on the conditions of the competition to find the operator.
In the current climate of unpredictable increases in construction prices and disrupted supply chains, construction companies are not prepared to make long-term forecasts or to enter into fixed price contracts, and investors have therefore become risk-averse. The market interest in large-scale projects has therefore declined, which may lead to insufficient competition in the selection process.
In the prevailing market situation, the risks of the project for the city have increased significantly, making it more economically prudent to take decisions once the economic and political situation has stabilised and investors are in a better position to assess their options and risks.