Detached house plot in Kaarela (Kuninkaantammi), plot 33412/5, Pitkäkoskentie 9, area 359 m², building entitlement 160 m², Helsinki

The City of Helsinki is leasing, by open price competition to the highest accepted bidder, seven (7) detached house plots in the Pitkäkoski area of Kuninkaantammi in the 33rd district (Kaarela). Each plot has its own auction listing where bids are submitted. Bids may be made for each plot.

The city has the right to accept or reject the bids made in the price competition.

The rent is determined on the basis of the accepted price competition offer with a 3.5% return target. Before signing the long-term lease, the tenant requires authorisation from the lessor to apply for a building permit. The authorisation is valid for up to one year and a reservation of two months' rent is charged for that period. The authorisation is decided upon in connection with the long-term lease. The long-term lease decision may be made after the building permit has been granted at the tenant's request. If the plots are built with more gross floor area for the plan’s main use than is shown in the zoning plan for the plot, additional purchase price/additional ground rent will be charged for the excess in accordance with the terms of the draft deed/ground lease agreement.

The tenant may purchase the plot for five (5) years from the start date of the long-term lease provided a residential building has been constructed to a useable condition approved by building control and the obligations under the long-term ground lease have been observed. If the purchase option is not used, the lease term is approx. 80 years. The rent includes a so-called level adjustment, meaning that the annual rent for the residential premises is adjusted at each adjustment point using the average of the annual averages of the Helsinki metropolitan area housing price index for old apartments (2020=100) for the three (3) years preceding the adjustment (adjustment index). For each level adjustment the base index used is the annual index figure for old apartments in the Helsinki metropolitan area for the year preceding the start of the lease. The level-adjusted annual rent is calculated by dividing the adjustment index by the base index and multiplying the annual rent by the resulting factor. Thereafter, the rent is adjusted every 10 or 20 years according to the tenant’s choice, compared to the index mentioned above. If the level adjustment cannot be performed at an adjustment time due to the absence of the housing price index, the new annual rent for the residential premises will be determined instead using the average of the consumer price index figures for the year preceding that adjustment (adjustment index), adjusted by the amount of implemented residential building rights (m²) stated in or exceeding the lease, the market value per m² set in the lease (euros/m²) and a 4% yield requirement, and the rent development will be linked to the change in the consumer price index according to the lease terms. The base index in this lease is the base index specified at the start of the lease term.

A reservation fee of €5,000 must be paid in accordance with the invoice before the short-term lease decision for applying for the building permit. The reservation fee will be credited against the rents of the long-term ground lease if the long-term lease proceeds. Otherwise the reservation fee will not be refunded.

Further instructions can be found in the attached Price Competition brochure.