From our office window, I can see nine cranes hovering over unfinished buildings. None of them are moving, even though it's now well above freezing. In winter, construction stops because of the sub-zero temperatures. But when it warms up, the work starts up again. A year ago, when I first arrived in Ulaanbaatar, there was a ton of construction activity. This year, there's almost nothing. Another visible sign of the crisis.
Even before the crisis, I was astonished by the sheer number of buildings going up. Within spitting distance of our office there are five new office buildings that are nearly complete, and many more throughout the city. Who is going to move into these spaces? There are even more residential buildings being thrown up, including entire sub-districts. But who's going to move into them, if they're ever finished?
The sad thing is that there are half a million people living in gers, traditional Mongolian felt homes, who desperately need decent housing. But many of them cannot even afford fuel for their stoves. How will they pay for private apartments?
Apparently many builders have run out of money and cannot obtain loans to finish their projects. If they do finish them, there won't be many takers. Most likely, everyone expected continued growth driven by the mining sector, with a corresponding surge in demand for office and residential property. Now it seems that many who gambled on this have lost.
I'm not sure what will happen to these buildings, but perhaps we'll need to replicate the Ukraine Unfinished Construction Site Divestiture project here in Mongolia.