Simon Johnson: The UK developer making his mark on Prague
One of biggest construction projects in Prague at present is the renovation and extension of the city centre Savarin Palace. Behind the 1.7 hectare complex, which should house Alphonse Mucha’s Slav Epic, are developers Crestyl, who are also creating the capital’s new Hagibor housing complex. The firm’s COO and managing director for Czechia is Englishman Simon Johnson. For the lowdown on its projects – and his own background – I spoke to Johnson at Prague Crestyl’s HQ at the highly impressive Libeň Dock, which the company also built.
What brought you to Prague back in the ‘90s?
“A simple answer: I worked for a big British construction company. They had opened an office in Prague and they were looking for English-speaking staff who were core employees to spend some time in Prague.
“So I was brought over here for a year. After staying for a year I got a couple of jobs, I got a couple of contracts, for Bovis, stayed – and then the rest is history.”
You were here during at least part of the “Wild East” days of the 1990s. What were some of the craziest things you saw in your industry at that time?
“Czech business has changed completely in that time. Development in the ‘90s was run almost exclusively by international institutions – there were no real Czech developers.
“Since then the Czech market has really taken off. The local players have become the strongest and the international players have dropped away.
“So that lack of local involvement, and pure international involvement, was the big surprise when I started.”
Crestyl now has many amazing projects, including this Dock where we are now, where your office is. But if I could, I’d like to mainly talk to you about a big project you’re doing right now, which is the Savarin Palace, right in the centre of Prague. Anybody who has been to Prague will have passed it, possibly without noticing it, because it has looked a bit drab in recent years. What is the scale of the Savarin Palace project?
“We always divide the project into two parts in our minds. One is the palace itself, which is being constructed. That will be finished in March next year. There we’re investing about half a billion crowns into a beautiful refurbishment of the existing palace. That’s something we’re really looking forward to. You can see that it’s almost finished now. You can see that the facades are complete. I think people are very, very keen to see that done.
“And secondly there’s the larger part, which is the new build and the refurbishment of the buildings on Václavské námeští [Wenceslas Sq.], on Panská and on Jindřišská.
“That’s been designed by Thomas Heatherwick and is an extraordinary scheme. We’re expecting to have the permits for that in the next month and we’re really looking forward to starting that.”
If I understand it right, the Savarin Palace will open onto four Prague streets?
“Yes, Panská, Jindřišská, Václavské námeští and Na príkopě.”
What does Heatherwick Studio, the studio of the well-known architect Thomas Heatherwick, bring to the project that maybe you wouldn’t find among local architects?
“The way Thomas Heatherwick strives to be excellent is something that is quite extraordinary.”
“They’re amazing. It’s just their approach. I’ve worked with some wonderful architects and there are some great architects working in the Czech Republic and most of our work is done with architects based here.
“But Thomas takes that design approach somewhere completely different. It’s much more interactive. As an investor you participate in the process much more.
“There’s really no idea that isn’t considered. They’re all challenged, but the way he approaches that design process, the way he strives to be excellent, is something that is quite extraordinary.”
We’ve also seen the Masaryčka project by Masaryk Train Station, which has been designed by Zaha Hadid Architects. Is this a kind of new trend in Czechia?
“I’d love it to be. I’m a big fan of Masaryčka; I think it’s a great project, I think Penta have done a great job.
“And why not? We are a small market but we have wonderful opportunities. There’s no limit of talent in the Czech Republic, but why not have a combination of local and international talent working at the moment, for all they can bring us. So it’s a great move, for me.”
Was it hard to get Heatherwick Studio involved?
“Yes. Initially, they’re very cautious about every project they take. Initially one of the partners came to have a look at the site. When they came to look at the site, they saw where it was, they saw the excitement of it, they saw the location in Prague. You could see the way they responded to Prague.
“And when Thomas came he just fell in love with it, and then the rest of the approach was very easy to agree.
“But that initial getting them confident that it’s something where they can express themselves was quite a challenge.”
Obviously it’s going to be a very big complex once it’s completed. What will people find there?
“You can actually climb up the Savarin Palace building on the staircases and actually walk across the roof.”
“What do I like? I like something that’s completely open to the air. There’s no enclosed passages – everything is public. I love this idea of when you go into a city and you open up spaces which were previously closed and not accessible.
“It was an old print works, it was closed, it was dirty. You’re getting a new sort of square in central Prague where the public can go and explore retail, explore office, explore restaurants.
“We have a public facade and a public roof, so you can actually climb up the building on the staircases and actually walk across the roof. You can freely walk down into the basement areas. We’re creating a new park in the centre of the project. It is a new 1.7 hectare project in the middle of downtown Prague, so it’s absolutely extraordinary. And because it’s so big it gives us the opportunity to put all those functions in there.”
Given where it is and all these positives about the site, how come it has taken so long for a project like this to come about?
“The Savarin Palace is a new 1.7 hectare project in the middle of downtown Prague, so it’s absolutely extraordinary.”
“The project has grown organically for many years. I think the first time someone planned to develop the site was in the year 2000. The developers who owned it before us, for instance Ballymore, had a certain plan. When we started, we changed that plan.
“There were big changes with the city as well, with the political approach of the city. For instance, the previous administration, when we started, insisted on huge numbers of public car parking. The second administration insisted that we remove public car parking. Those things create substantial changes in the project development period.
“We ourselves changed from an office and retail development to the Heatherwick scheme that we see today. So all of these things affect the timeline. But even in a Western country a project of that nature would have a substantial planning timeline.”
I’ve been reading that the Savarin Palace will house a kind of centre that will be the new permanent home of the Slav Epic by Alphonse Mucha. Is that confirmed or is that still under negotiation?
“It’s still under negotiation. We have reached preliminary agreements with the city to do so. We think it’s a wonderful thing to do and we’re working hard with the city and the Mucha Foundation to realise that now.”
Are the Mucha Foundation on board with this?
“Yes.”
I was reading also that Crestyl will fund this centre. Who will operate it, if it comes to pass?
“How it will be operated is part of the discussions at the moment, but it will probably be operated between the foundation and the city itself.”
What will it look like? What will people find at the Mucha centre?
“In the eyes of the Mucha Foundation it wasn’t enough just to find a place for the Epic – they really want to sort of demonstrate the life of Mucha.”
“The initial idea was to create a space where the Slav Epic would be housed. It’s an extraordinary piece of work, in both its scale and its complexity.
“But in the eyes of the foundation it wasn’t enough just to find a place for the Epic – they really want to sort of demonstrate the life of Mucha, his whole history, his effect on modern art, and to really have a gallery that expresses all parts of his work and his life.
“When you start looking at how much space you need to do that, it becomes a substantial piece of real estate, so we’re looking at a gallery that’s closer to 5,000 square metres. We’re designing it with Heatherwick to make it extraordinary.
“All of a sudden you’re looking at an international gallery of the standard of the Van Gogh Museum in Amsterdam, which will not only be an asset for people who live in Prague, but also for people who visit Prague. I can imagine that every schoolkid in the Czech Republic is one day going to get on a bus and come and see this.
“It’s quite an extraordinary endeavour. It’s exciting.”
Is it the case also that the huge paintings that make up the Slav Epic will be seen in a better way than people have had the chance to in the past?
“We’d like to think so. Alphonse himself laid out the paintings exactly the way they should be seen, and to find a space big enough to do that is quite extraordinary. Most of the time they’ve been exhibited, they’ve been exhibited back-to-back, or in a fairly limited space which doesn’t fulfill the original intents of the artist.
“But I can assure you, with Savarin it’s bespoke, based on the artist’s wishes, exactly the format, scale and layout that Alphonse wouldn’t wanted for the world to see his paintings.”
You also worked on Palladium, which I guess is downtown Prague’s most busy and large shopping centre. But just beside the Savarin Palace there is also a shopping centre, Černá růže, which always seems kind of dead. I wonder, what makes a centre like
“First of all, I think the phrase ‘shopping centre’ is history. We don’t like to talk about that any more. You know, things are ‘mixed use’, they’re ‘destination centres’.
“Palladium is dated. It’s had its time. It’s 20 years old and it was designed for a market that existed at the time.
“Černá růže is beautiful. I love the architecture and there’s a feel to it which is really special. But the person who looked at that, in my mind – and this isn’t criticism – focused more on the architectural intent rather than on the functional use of the centre.
“I think the phrase ‘shopping centre’ is history.”
“Perhaps a more experienced developer with knowledge of how retail patterns work would have looked more constructively at how to get their customers to the higher floors.
“So Černá růže is beautiful. I think it’s one of the nicest spaces in Prague, but it doesn’t have those attributes that a successful destination in modern architectural terms should have, in my mind.”
Crestyl also builds apartment complexes. Right now you’re building at Hagibor, another major project. For a long time I was hearing that there was a great shortage of apartments in Prague. Is that still the case?
“Yes. The residential market has slowed. Mortgage rates are affecting all of us. Most developers are still saying they’re selling well and everything’s fine. It’s not – the market has slowed down.
“But there is a shortage of permitted product. The planning permit and building process here is quite arduous, and that limits the supply of apartments on the market. And because there is relatively low supply and there is still ongoing demand, that market continues.”
Crestyl is also planning to move into, or is already moving into, the area of building flats to rent. Could you tell me something about that please?
“After Covid, residential or PRS [private rented sector], build for rent, became really, really popular, because it was shown to be the most sustainable during the period of Covid and investors jumped on that.
“Developers, because there’s investor interest, tend to be driven by that investor interest.
“Interest rates have come now and that’s slowed down that interest, because investors are looking at maybe 5 or 5.5 percent return on a residential development and they’re borrowing money at 7 or 8 percent, which doesn’t add up today.
“Genuinely I believe it’s the future. If you look at co-working, how people live, living in rental accommodation, not staying in one accommodation for the whole of your life, is the way people will want to live. All of the Western markets are moving in that direction.
“It will be a big opportunity in the Czech Republic and we’d love to be part of that. It’s a difficult market to be involved in now.”
How big are you going in that area? What are you planning, basically?
“We’re a very ambitious company, so we’d like to give numbers. In Poland, for instance, we have under construction more than 2,000 apartments in that field.
“We’re developing one project with Invesco now in Hagibor. I’d like to be talking of numbers of thousands of lease apartments in our portfolio over the next five years.”
If I could end with a personal question. You have really made a mark on Prague, and I guess other parts Czechia. When you drive around do you have a sense of pride? Do you think, We built the Libeň Dock here, we built this, we built that?
“I think yes. I think anybody who works in our industry… Even when I walk around London now, as I visit, I’ll see projects which I worked on as a young man.
“Being involved in development and construction, you leave that footprint in the built environment and it always brings you pleasure to see what you’ve done, particularly when you see those projects sort of blend into their community and become almost like existing rather than new build.
“Clearly my role in the Czech Republic is much larger than in the UK when I was a younger man, and there are some really nice things I’ve left in the Czech and Slovak markets.
“I’m particularly proud of the Dock – I think it’s beautiful. Eurovea in Bratislava is one thing I’m particularly proud of; that was a great development and was market leading at the time. And I love what we’re doing now in Savarin and Brno.
“That opportunity to do a project which doesn’t change its local environment but can also affect and change the city that we’re in – these are wonderful opportunities to do something special.”
