Prague – The City Hall of Prague 8 returned approximately 55.2 million crowns to the municipality as a repayment from a loan of 300 million crowns, which it received three years ago for the completion of the Palmovka Center. Since she did not finish the building, she has to return the money. The reason for the repayments is the poor financial situation of Prague 8. This follows from a document approved today by the Prague councilor. The building was to be completed according to the agreement concluded when granting the loan by June 30, 2019. The management of Prague 8 stated that it is now solving the problem with the city, Mayor Ondřej Gros (ODS) did not want to comment on the current situation. Originally, Prague 8 was to return the entire amount at the same time earlier.
The construction of the buildings, where the town hall was to have a new seat, was approved by the previous management of the city district in 2010. The costs were estimated at more than a billion crowns. However, the previous management of the town hall stopped the construction and subsequently its ownership was tried.
The current management of the town hall asked the capital to be able to repay the debt last year. In January 2021, according to the document, the mayor of Gros (ODS) asked for repayments again due to lack of funds and submitted the repayment schedule as part of the handover of the documents for the financial settlement for 2020. In March, the town hall sent about 55.2 million.
“The whole thing is still going on between the city districts of Prague 8 and the municipal negotiations, which should lead to the resolution of the whole matter. This also applies to buildings and surrounding land. I can’t comment on that yet.” said Gros.
Prague 8 was originally supposed to repay the entire amount earlier, but in March 2020 the Prague City Council approved an amendment to the loan agreement, which allowed the money to be returned until 31 December 2020. But according to a document approved by Prague City Council today, the amendment was not signed by City Hall. According to information from ČTK, the city district owes another 80 million as a penalty. The penalty continues to jump.
The project for 1.1 billion crowns was approved in 2010 and was to have a new town hall and commercial premises. About half of that amount was built. However, after the elections in 2014, the previous management of Prague 8 questioned the ownership of buildings and structures concerning legal disputes between Prague 8, the municipality and the construction company Metrostav. In the end, the parties agreed that the building would be completed in Prague 8. However, this eventually came to an end, among other things due to disputes with the builder, who terminated the contract with the town hall. At that time, the company justified its step by the inaction of the town hall. The current leadership of the 2018 election is looking for a torsion to the highway building, one of the options being for sale.