The city of Prague is seeking ways to withdraw from its lease at Škoda Palace, which it has used as its headquarters since 2006. Unfortunately for the city, this lease that was signed by Prague’s former mayor Pavel Bém doesn’t run out until 2026. It was controversial at the time, since the city would end up paying a total of CZK 4.5bn (€17.3m) over the life of the contract.
The daily Hospodářské noviny reports that in 2004, the city had the option to purchase the building outright for just CZK 850m. It goes on to criticize the city for agreeing to pay CZK 930/sqm/month, as the €36 per sqm this works out to is more than twice the standard rent price of refurbished office space in the center of Prague.
Prague’s mayor Bohuslav Svoboda is currently looking for a legal way to cancel the contract or at least negotiate rent reduction by 40-50 percent. One option the city is reportedly considering is the failure of the developer, Copa, to inform the city that the building’s ownership structure was changed. Another option under consideration is to purchase the building.
