The council approved the agreement between the city, Prague 8, and Metrostav regarding the Palmovka Center

Prague – The Prague councilors today approved a trilateral agreement between the capital city, Prague 8, and the company Metrostav Alfa concerning the unfinished Palmovka Center. The document will allow the disputes over the building's shell to be resolved and the construction to be completed. Jan Chabr (TOP 09), city councilor, informed ČTK of this today. According to the agreement, Prague 8 will pay Metrostav approximately 142 million CZK. In exchange for the building and land, the city will grant a subsidy of 550 million CZK and will also forgive its debt.

The construction of the building, which was to house the city hall's new headquarters and include commercial spaces, was approved by the previous management of the municipal district in 2010. The costs were then estimated at over one billion. However, the previous leadership of Prague 8 halted the construction and subsequently disputed its ownership in court.

"Given that this is an unfortunate milestone from the past and a set of real estate that is to be transferred to the ownership of the capital city, it is essential that all disputes and potential legal claims concerning the municipal district are resolved. This is one of the neglected areas in Prague, and in order to begin its overall revitalization and address the area comprehensively, it must not be burdened by further legal and court disputes. This agreement allows us to do that," stated Chabr.

The agreement was approved last week by the representatives of Prague 8. According to mayor Ondřej Grose (ODS), it is an acceptable compromise, as Metrostav was seeking a higher amount in court than what was ultimately agreed upon with the city hall. Initially, there was a risk that the municipal district would have to pay up to 214 million.

Furthermore, the city will provide the city hall with a subsidy and forgive a debt of 250 million CZK according to the agreement. The city hall received a loan of 300 million, which was to be used for the completion. However, that did not happen, and the municipal district returned only part of the loan to the city. The remaining amount will now be forgiven. "The goal was to protect the municipal district from bankruptcy. Therefore, we forgave the obligation to return the subsidy," said Deputy Mayor Pavel Vyhnánek (Praha Sobě). Prague 8 has long been struggling with a lack of funds. The aforementioned subsidy of 550 million CZK will be disbursed to the city hall gradually from 2022 to 2026.

In the future, the Palmovka Center should be part of the transformation of the entire Palmovka area, where new buildings will arise, and the current bus station will disappear. The existing Bohumil Hrabal Square will also be transformed, with new greenery, benches, or a café being added. What specifically will be in the Palmovka Center building is not yet clear. According to Deputy Mayor Petr Hlaváček (TOP 09), it should consist of administrative spaces, and apartments will be built around the building.