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Special committee condemns Rosimannus' Arsenal deal

The Arsenal shopping center today.
The Arsenal shopping center today. Source: (Rene Suurkaev/ERR)

The special committee called to look into the selling of the formerly state-owned Arsenal property to a business in which a prominent Reform Party member held a silent option has taken the point of view that politicians shouldn’t be allowed involvement in this kind of transaction.

After the committee’s Monday meeting, chairman of the Riigikogu’s Anti-Corruption Select Committee, Artur Talvik (Free Party), told ERR that involvement in transactions such as that of the Reform Party’s Rain Rosimannus in the case of the Arsenal deal could look and might as well be corrupt, and that this damaged the reputation of the state.

The plot of the former state-owned munitions producer E-Arsenal was sold to a company Rosimannus in which Rosimannus was quietly involved. At the time the plot was sold in 2012, up-and-coming Reform Party politician Taavi Rõivas, to be made prime minister two years later, headed the supervisory council of state real estate company RKAS.

In the official documentation closing its investigation, the committee condemned the deal, stating that it had damaged the reputation of both the state’s real estate administrator RKAS, and that of public institutions on the whole. People’s involvement in transactions needed to be transparent also after a reasonable period following their exit from active politics. Anything else had the potential to damage the reputation of the state, the committee wrote.

Plot not sold to the highest bidder, but after real estate boom ended, and for millions less

The plot of the recently opened Arsenal shopping center, eventually developed by a company belonging to businessmen Aadu Oja and Reform Party heavyweight Rain Rosimannus, has a more interesting transaction history than previously known, as it turned out in late January this year.

According to daily Päevaleht, investment holding Infortar (Tallink, Eesti Gaas, among others) wanted to buy the Arsenal plot in Tallinn in 2007. When then-owner E-Arsenal was looking to sell it to the highest bidder, Infortar won, but eventually was rejected twice.

Infortar CEO Ain Hanschmidt told Päevaleht that they were rejected twice with no explanations offered. He said he had wondered at the time who was able to put a stop to a process so big and with such a price. “And twice! But apparently we simply weren’t the right winners,” Hanschmidt said.

Infortar made two bids, one over 50 million kroons (€3.19 million), the other over 84 million (€5.36 million).

Infortar intended to use the Arsenal plot to build offices and support infrastructure for shipper Tallink Group. The plot is located close to the sea, which would have made it a good choice. Tallink’s offices were later accommodated in a new building closer to the port terminals.

Rosimannus: Center Party-ruled Tallinn could have interfered

The Arsenal property then passed over into the possession of state-owned real estate company Riigi Kinnisvara AS (RKAS) in 2009. In 2012 the plot was sold to a holding controlled by real estate developer Aadu Oja—an enterprise, as it turned out just recently, long-time Reform Party big wheel Rain Rosimannus was involved in as well.

Oja and Rosimannus’ company was able to buy the plot from RKAS for a mere €1.52 million.

Rosimannus said it had been decided at the time to draw up the transaction as an option as the whole of Arsenal’s development had to happen in a Tallinn ruled by Edgar Savisaar. Because of the political situation they had lacked full certainty that his involvement in the Reform Party wouldn’t be used as a pretext for biased treatment by city powers, which could have undermined the entire project.

Editor: Dario Cavegn

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