In post-Olympic Sochi, white elephants – and improved daily life

The Sochi Winter Olympics, the costliest in history, left behind a host of empty facilities and stadiums. But many locals say that the investment was worthwhile.

For years in the Sochi suburb of Adler, a tiny Soviet-era train station served this end-of-the-line community, with its single northbound railroad track.

Today, it is a cafeteria. Over it looms a new station, a giant steel-and-glass balloon that's today one of the largest railway stations in Europe. Built to impress and accommodate huge Olympic crowds, it now handles little more traffic than the old station did.

The Sochi Olympics was billed as the most expensive in the history of the Games, with its projected budget quadrupling during construction. Today, the Adler station and the largely empty stadiums in nearby Olympic Park stand as prime examples of a phenomenon known as "ghost infrastructure," which has fueled post-Olympic blues in many host cities. The upkeep of the huge structures is a constant drain on the budgets of the various local and federal offices that have been given dubious ownership of them.

But many people in Sochi, a city of half a million wedged between the Black Sea and the Caucasus mountains, point out that tens of billions of dollars in public and private investment also went into transforming their city from a provincial resort town, known mainly for its health spas, into a world-class vacation spot.

"People around here debate this all the time," says Alexander Balov, manager of the popular Sochi.ru news website, which often criticizes local authorities. "There definitely are winners and losers from the Olympics, plenty of pros and cons for the city as a whole. I personally see it as 50-50."

'A public burden'

Post-Olympic blues have haunted cities around the world. Many a metropolis has experienced the prestige and excitement of hosting the Games, only to find themselves saddled with debt and a herd of costly white elephants when the crowds leave and the torch goes out. The phenomenon has even spurred some cities to reject bids that were already underway, as happened last year for both Boston and Hamburg, Germany.

And Sochi has proven no exception, thanks to the Sochi Winter Games' huge price tag. Many of the facilities in the Olympic Park struggle to attract events, such as concerts, sports matches, and even business conferences. One of Russia's leading state-run banks, Vneshekonombank, is reportedly floundering under the weight of bad Olympic loans.

"More than $50 billion was spent on Olympic preparations, and much of this was loaned by Vneshekonombank. Now it's a serious problem, because the banks are trying to unload their bad Olympic debt on the government," says Vasily Solodkov, director of the Bank Institute at Moscow's Higher School of Economics.

"There is no money in the state budget to cover this, and the various solutions under discussion involve either tapping the pension funds or raising income taxes. In other words, it's going to be a public burden for quite awhile."

But Mr. Balov argues that the huge debts and empty stadiums do not tell the whole story, at least as far as how locals' lives have changed.

"About 70 percent of the investment that came in here before the Olympics was not for sports infrastructure at all, but went into things that will benefit the city in the long term like roads, hotels, schools, sewage and water systems, and a completely rebuilt international airport," he says.

Sochi's legendary traffic snarls along its single seaside main avenue have been banished by the ultra-expensive, Moscow-funded construction of a dublyor (duplicator) second road, mostly blasted through the mountains under the city. Locals say that without the Olympics, no one would have ever paid for that.

And the rolling power blackouts that were a feature of Sochi life are a thing of the past as well, thanks to a new electricity grid.

A Russian Florida?

Perhaps most importantly, a wave of private investment into Sochi in the Olympic run-up built scores of new condominium towers, office blocs, and shopping malls. Real estate professionals say that is fast defining a whole new role for Sochi, the only subtropical city in Russia, as the retirement capital for the whole country – a sort of smaller version of Florida. The region now boasts mountain resorts, two dozen five-star hotels, and a modern seaport that's filled with yachts and was visited by 20 oceangoing cruise liners last year.

"Demand is going crazy, and prices for Sochi apartments and condos have doubled in the past two years," says Bersano Bers, sales director for Vincent, the region's largest real estate agency.

"If you have some money and live in Russia, where it's snowbound for half the year, Sochi is the ideal city to buy a rest or retirement home. It's a Russian-speaking place, but with palm trees, where you can spend your rubles. The more Sochi's standards continue to progress toward European levels, the more we expect this boom to continue," he says.

Even over at Olympic Park, the mood is not all black. While many, even most of the park's facilities are frequently empty, there is a constant – if occasionally successful – effort to find fresh ways to utilize them.

The huge Fisht Stadium, where the Games' opening and closing ceremonies were held, is being renovated to accommodate the 2018 FIFA World Cup, which Russia is hosting. One of the smaller ice rinks has become a national skating school, to train a new generation of Russian hockey players and figure skaters. The park is now home to a Formula One racing track, and a giant amusement park that does seem to attract large numbers of local people on weekends.

Thanks to Vladimir Putin's personal patronage of the city, and the sport, Sochi now boasts its own hockey team, whose home base is the former Bolshoi Ice Dome in Olympic Park.

"It's extraordinary that Sochi, a subtropical city that still doesn't have its own soccer team, now has a hockey team," says Balov. "But this is our life, this is the way things happen here."

Environmental damage

One group that's hopping mad over the Olympic legacy are environmentalists. They claim that none of the Olympic promises to protect the fragile ecology in the region were kept, including the requirement to install a "zero waste" system of garbage sorting and recycling for Sochi.

"During the Olympics they just trucked all waste to a dump 300 km [186 miles] away. Then they handed waste disposal to private companies, who charge heavily for it and often illegally dump their loads in the national park rather than hauling it away as they're supposed to," says Yulia Naberezhnaya, deputy coordinator of North Caucasus Ecology Watch, an environmental group.

She also complains that "the world's most expensive road," a road-and-rail link up to the Olympic cluster along the left bank of the Mzympta River at a cost of about $10 billion, was totally unnecessary – since there already was a perfectly good road on the right bank – but also undermined the river valley's ecology, perhaps permanently.

"One of the few Olympic investments that turned out to be profitable was ski and mountain resorts for rich people," Ms. Naberezhnaya says.

"Now there are reports that Russian big business wants to to build two more resorts, which will impinge on the territory of the UNESCO-protected Caucasian National Park, the last pristine alpine wilderness in Europe. So, to us it seems that they used state funding, and changed a lot of laws, in the name of the Olympics. But actually they just wanted to open up development of our natural heritage for the benefit of a few wealthy people," she adds.

But Tatiana Strakhova, a lifelong Sochi resident who works at Olympic Park, says the quality of local life has changed for the better.

"After suffering through years of inconvenience during the Olympic construction, I mean noise, dust, and massive traffic jams, it was such a relief just to wake up after the Games ended, and find that everything was peaceful, renovated, and all this new stuff was ours," she says. "This city has been changed completely, it's much improved, and it has a great future. I'm sure of that."