Why Are They Tearing Up Moscow?

(Bloomberg) -- Ilya Bogdanov evacuated his family from their cozy apartment in the heart of Moscow after spending two summers with clouds of dust and roaring construction machinery. For the rest of the warm weather, they will stay on the Baltic seaside in Latvia.

"We need a respite from urban improvement," the 44-year-old insurance analyst deadpanned.

Moscow is undergoing a massive reconstruction, amid an economic crisis caused by the slump in oil prices and Western sanctions imposed after Russian's incursions on Ukraine. The city was last subject to such a major revamp under Soviet leader Nikita Khrushchev in the 1960s, said Grigory Revzin, an urban development expert and a champion of the project even before Moscow hired his architecture firm.

Sidewalks are being widened and primped on all the major streets of the city center, with about 50 streets in reconstruction each summer. Beyond the center, more than 70 new metro stations are being built, at a cost of roughly $15 billion. Two additional circle lines, which connect the radial lines that cross in the city center as in London and Berlin, will complement the existing one, built in the 1950s.

In the past four years, the authorities have made over Moscow’s numerous parks and gentrified old industrial areas, turning them into slick hipster haunts that swarm with galleries, designer shops, startup offices, and co-working spaces for freelancers. They have considerably reduced traffic chaos by introducing paid parking across the city. Separately, a reconstruction of all major soccer stadiums in Moscow is under way for the World Football Cup to be hosted by Russia in 2018.

Revzin, a partner in KB Strelka, which is helping redesign the streets, said the idea is to make the city "more tolerant to pedestrians" at the expense of cars.

"We want to create a friendly city where streets serve as institutions that enhance communication between the inhabitants," Revzin said. Moscow plans to spend about $1.9 billion on the streets and an additional $1.1 billion on reconstructing the whole river embankment, he said.

If Bogdanov was exasperated enough to retreat to the Baltic shore, much of the urban middle class isn't thrilled with Moscow's big dig, either, or with the lack of public consultation before the tractors kicked into gear. The reconstruction has caused an uproar in the liberal press and on social networks, forcing Revzin into an exchange of bitterly worded op-ed pieces with leading liberal opinion-makers. Local protests against specific urban development projects (some related to the ongoing reconstruction, some not) are on the rise and often lead to clashes with police and private guards.

"It’s like a war. People feel as if their city has been occupied by an alien force that strikes in many directions simultaneously, with no prior warning," said municipal deputy Yelena Rusakova, who is affiliated with the liberal opposition party Yabloko and who led a successful campaign to suspend the reconstruction of a major thoroughfare, Leninsky Prospect.

The press secretary for Mayor Sergei Sobyanin declined to comment on the project, directing the request to the Department of Capital Reconstruction, which said the project is "mostly economic" but also sprang from "caring about citizens' health, education, social welfare, and leisure."

The urban renewal project would seem to be a godsend. A city of 12 million with a budget a third the size of New York’s (population 8.4 million), Moscow is choking on some of the world’s worst traffic jams and still suffering from post-Soviet infrastructure decay. The state of the urban environment was among the issues raised during major protests against President Vladimir Putin in 2012, along with unfair elections and corruption. It was the only demand of the protesters the authorities have addressed in earnest.

At first the reconstruction was a way of appeasing the middle class, which made up the bulk of the protests, Revzin said. Sobyanin even had a deputy responsible for gentrifying the city and acting as a liaison with the intelligentsia, who was sometimes referred to in the press as the “hipster minister.”

Then came the 2013 mayoral elections, in which Sobyanin was confronted by the protest leader Alexei Navalny. Navalny came in second, with 27 percent of the vote, and has since been barred from running for public office, after being convicted of fraud in a case widely regarded as political.

"The creative class overwhelmingly voted for Navalny," Revzin noted. The city government decided at that point there was no reason to mollify a minority that would remain hostile no matter what it did, he said. The hipster minister resigned.

These days, Revzin said, the government "simply doesn't talk to cultural and business elites, which inevitably results in them becoming critical of all the changes." Revzin, who hails from the same cultural environment as the anti-Putin protesters, lamented that the conflict leaves his own team in an ambiguous role, because "we’ve been driven by the idea of making the city comfortable for creative people, while nowadays the creative elites are grossly marginalized."

Maxim Kats, a municipal deputy and political operative who made his name by promoting the gentrification of Moscow, cited Sobyanin’s "presidential ambitions" as a factor in the big dig. Mayor of Moscow is an ideal springboard to the presidency, and insiders spoke of Sobyanin as a potential successor to Putin back in 2007. Instead, Putin chose Dmitry Medvedev as his temporary replacement. Since then, a Sobyanin run has repeatedly surfaced in the Russian news media. Sobyanin has steadily denied any interest.

Kats also said city officials wouldn't miss a chance to process rich government contracts. Russia has long remained low in Transparency International’s corruption perception index chart, and massive construction in the run-up to the Asia-Pacific Economic Cooperation summit in Vladivostok in 2012 spurred a flurry of corruption cases culminating in the arrest of Vladivostok's mayor, Igor Pushkaryov, last month. The $50 billion 2014 Sochi Olympics project was dubbed "Russia’s biggest fraud case in history" by the assassinated opposition leader Boris Nemtsov, who drafted a report on the subject. 

Kats defends the Moscow infrastructure project itself, saying people tend to reject improvement until it is complete and they can feel its positive impact—even though he campaigned against some aspects of the reconstruction, such as replacing electric-powered trolleybuses, whose lines date back to the 1930s, with diesel buses.

"I disagree that we are talking about authoritarian modernization. It is an expert-driven modernization," he said, being done "in accordance with the best modern trends and practices in urban improvement."

The outcome of Russian parliamentary elections, due in September, will reflect the success or failings of the project. Sobyanin said in June he would lead the campaign of the ruling United Russia party in the capital. It’s going to be an uphill struggle as United Russia’s popularity declines nationwide while Moscow remains the country’s main hotbed of political protest.

Still, the reconstruction may yet help soothe the middle class, said Kirill Petrov, a political expert at Minchenko Consulting.

"It’s like saying, hey, there is no bread," he said, "but here are the circuses."

To contact the author of this story: Leonid Ragozin in Washington at leonid.ragozin@gmail.com.

To contact the editor responsible for this story: Peter Jeffrey at pjeffrey@bloomberg.net.