The parties involved in the joint inspection conducted by SJSC “State Real Estate” and the National Heritage Board have gained confidence that the Mežotne Palace complex has been taken over from the tenant in good condition and that the historical values have been preserved. We have initiated a joint working group of the cultural industry and the municipality on further scenarios of the viability of property. Until a decision is made on the further use of the property's content, SRE will continue to manage, maintain and protect the property,” Andris Vārna, Member of the Board of SRE, points out.
The property is an important part of cultural and historical heritage, regarding which SRE has thus far ensured good management and the preservation of all historical values. “Those present at the property inspection have admitted that the tenant has left the premises in good condition. In order to consider the possibility for the state to preserve this property in the future, we have called on the Ministry of Culture and the local government to work together to find a solution for the future use of the Mežotne Palace complex. Until the decision, SRE will continue to ensure the non-deterioration of the technical condition of the building and the preservation and security of the historic building,” A. Vārna points out.
The first joint meeting of the working group will take place in early May. Several development scenarios would be considered in the joint discussion: transfer of property to the municipality, preservation of property to the state as a museum, if the National Heritage Board together with the Ministry of Culture finds a solution for using Mežotne Palace for cultural needs, or sale of the property in accordance with the procedures prescribed by law - by public auction.
“It is important to understand that SRE manages buildings, but their content and use are decided by the users of the industry. It is rational and economically justified to invest in buildings, where the content and needs of their use are clear, therefore SRE manages several buildings intended to ensure a public function, which are still waiting for a solution on future content use, the most visible examples of which are the buildings at Elizabetes iela 2 and Kronvalda bulvāris 6, which is connected to the building at Elizabetes iela 2 and is currently reserved for the development of an acoustic concert hall, as well as the historic Tetera nams at Brīvības iela 61. Along with the issue of Mežotne Palace, it is planned to jointly consider in the working group initiated by SRE, the effective development and management model of these and other cultural and historical properties in order to ensure their further viability,” A. Vārna points out.
Taking into account the fact that Mežotne Palace was not necessary for the performance of public administration functions, the property was previously leased to the hospitality industry - transferred to long-term lease. It has already been reported that in the conditions of the pandemic and its containment measures, the commercial tenant has not been able to adapt to the conditions in order to receive full possible lease support, and fulfil its obligations to manage the historic Mežotne Palace complex, so SRE was forced to terminate the lease in April this year. In the economic situation of the post-pandemic period, the search for an alternative tenant is not a solution, therefore other scenarios of property development should be sought in cooperation with the industry.
Meanwhile SRE will continue to ensure the non-deterioration of the technical condition of the building and the preservation of the historic building. This includes minimal cleaning of the territory, technical security, installation of video surveillance and other systems, real estate tax and insurance. To ensure the preservation of the building, additionally during the winter period heating will be kept to a minimum. It is estimated that the maintenance of Mežotne Palace will cause the state losses of about 70.5 thousand euros per year.
The arrangement of the palace complex requires capital investments in the amount of approximately 4.5 million euros, which includes the renovation of the palace building, administrative building and sports hall, as well as the arrangement of internal engineering networks in accordance with modern requirements.
Taking into account the fact that the pedestrian pontoon bridge over the River Lielupe, which was renovated in 2018 by SRE, connecting Rundāle Municipality and Bauska Municipality, has been included in the palace complex, to which the tenant has so far provided the maintenance of the bridge, the placement of the bridge in the spring and excavation in the autumn, SRE has made a proposal to Bauska and Rundāle district councils to evaluate the possibility of taking over the pontoon bridge into use and management free of charge to one of the local governments. The readiness of Bauska Municipality to take over and further maintain the bridge has already been made public.
Out of the total of about 1,200 manors and palaces in Latvia, three are under the direct management of SRE - Riga Castle, which has long been used for public functions and receives state support, while the Mežotne and Igate complexes have so far been leased to private individuals.
SRE is implementing 118 infrastructure development projects worth approximately 180 million euros and working on 25 new project ideas. The company provides professional real estate management and administration for approximately 450 real estate properties with 1000 buildings of 1.02 million square metres and more than 3700 land properties with an area of 9.5 million square metres. As a testimony to good governance and sustainable operations, the capital company has received a Gold award in the Sustainability Index by the Institute of Corporate Responsibility and Sustainability. SRE was founded in 1996 and its sole (100%) shareholder is the Ministry of Finance of the Republic of Latvia.