The development of Hipodroomi at the site of the eponymous historic harness racing track was held up for years as Alfa Property, the owner of the site, did not see eye to eye with Tallinn's Urban Environment and Public Works Department. Namely, the Tallinn Hippodrome site currently lacks water and drainage systems, and the city demanded the developer build a pumped rainwater drainage system that would cost an estimated €12 million.

On Friday, however, the City of Tallinn and developers signed an agreement according to which the city will draw up the necessary special infrastructure projects and organize public procurements while Alfa Property will cofinance construction of the infrastructure.

The development of Hipodroomi at the site of the eponymous historic harness racing track was held up for years as Alfa Property, the owner of the site, did not see eye to eye with Tallinn's Urban Environment and Public Works Department. Namely, the Tallinn Hippodrome site currently lacks water and drainage systems, and the city demanded the developer build a pumped rainwater drainage system that would cost an estimated €12 million.

On Friday, however, the City of Tallinn and developers signed an agreement according to which the city will draw up the necessary special infrastructure projects and organize public procurements while Alfa Property will cofinance construction of the infrastructure.

The framework for the agreement was in many ways provided by a Tallinn regulation, adopted last December due specifically to the Hipodroomi dispute, which sets out specific rules regarding who, how and to what extent infrastructure — including streets, roads, parks and sewage systems — must be built in cases of private developments.

The deal inked with Alfa Property on Friday marks the first of its kind for the capital city.

Tallinn Deputy Mayor Vladimir Svet (Center) said that a new rate was used when calculating the cofinancing for the Hipodroomi development  — €20 per square meter of office and apartment space to be built plus the construction price index (CPI).

Alfa Property board member Jaanus Mikk said that he couldn't understand why the city had to obligate the company to build a rainwater drainage system as this system would serve other parts of the city as well.

"Now there's a logical situation in which the city will rent this infrastructure out and every developer can join it on equal terms," he said.

Alfa Property, meanwhile, will be building several sections of road as well as pedestrian walkways.

Thousand of apartments, new street and a vehicular tunnel

Mikk referred to the Hipodroomi project as a very big one: together with parking spanning a combined area of 350,000 square meters, including 130,000 square meters of office space and nearly 120,000 square meters of apartments.

The development is slated to include a combined 1,000 new apartments across all buildings.

Karl Ader, Development Division manager at business real estate developer EKE, has previously told ERR that a lot of effort has gone into securing the building permits for the business quarter, but they remain hopeful that they can still break ground this year.

On Friday, Ader said that they can hopefully start construction "very soon."

"We'll be submitting our building permit applications in the next few days, and processing will begin," he said. "I hope we're issued our building permits very soon — that by next year, construction will have long since been underway and that all of the building shells are already up. Processing [of the permit applications] will in any case begin right away."

The business quarter being developed by EKE will include three commercial buildings, anchored by tenants Swedbank and Elisa and, in the retail block, supermarket chain Rimi.

The residential area will be developed by Reterra Estate, whose board chairman Reigo Randmets said that on top of the residential buildings, the company will also be building a major recreation area in the development as well.

"We want to submit our building permit [applications] within the next couple of weeks, receive [them] sometime this year and then start building in the first half of next year," Randmets said. "In the first stage, we'll be building six buildings."

Also planned are the expansion of the existing Merimetsa tänav and construction of an entirely new street — to be named Hipodroomi tänav — and a vehicular tunnel to be routed below these two streets. According to Mikk, the building permit application for the Paldiski maantee junction, Merimetsa tänav, Hipodroomi tänav and the first tunnel was set to be submitted Friday.

A promenade stretching from Paldiski maantee to Merimetsa tee is slated to include parks, natural recreation spaces and a pond.

The project for the construction of Hipodroomi Quarter was first launched by Alfa Property owner Jaan Manitski in 2007. Over the years since, the development's detailed plan has been updated and expanded several times, including since its implementation in 2011.

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