28.06.2026
A new apartment in Riga costs a third less than an equivalent one in Tallinn. Not because construction is cheaper, but because the permit process takes a year, not three. When Rail Baltica is completed, it will be faster to travel from Tallinn to Riga than from Tallinn to Tartu. New-generation real estate developer Kristjan-Thor Vähi is not waiting: for him, the two Baltic capitals are already one economic space. He is already building based on this knowledge.
The starting point, not the periphery
Invego board member Vähi's support for Rail Baltica is not just about the need for better infrastructure – it's a question of identity. He points to people who complain about Estonia's geographically peripheral location and turns that logic on its head. "It would be right for Estonians, as Europeans, to say that we are the starting point here," Vähi said at the Rail Baltic Estonia mobility conference "The Economy is Getting Derailed." "Today, we have a very important mission to reconnect all these points. Faster and more convenient access to all points is, for me, the most important feature of Rail Baltica."
Two home markets
For Cancer, Latvia is not an experiment or a side project, but an equal home market. The Invego group, which includes over 60 companies, is currently developing a total of 30 projects in Estonia, Latvia and Portugal. Over 150,000 square meters of residential real estate and 50,000 square meters of commercial real estate have been completed. The group's most well-known works have recently been the Krulli Park business district in Tallinn.
Vähi's first deal with Latvian real estate was over twenty years ago. Today, he visits Riga practically every week, not just for one meeting, but for two or three days at a time. He speaks of the city with a warmth rarely found on the stage of mobility conferences: "A modern city, on the one hand homely, on the other with a completely different carpet than Tallinn."
This is not just rhetoric. Invego has formulated its position specifically: “We have two home markets, Estonia and Latvia equally.” Today, Latvian volumes in Invego’s portfolio are larger than Estonian ones. Eight large-scale projects are currently under development and sale in Riga and its vicinity.
Bureaucracy comparison: Riga vs Tallinn
Vähi points out one specific figure: the final price of a new home in Riga is a third cheaper than in Tallinn. The reason? “Our construction prices are the same as in Latvia – we are one big market – but the processing time is significantly shorter.” The paperwork related to plans and permits takes a year to a couple of years in Riga. “The end consumer is the one who actually pays the difference.”
"Tallinn is about five years ahead of Riga in the real estate sector, but that gap has started to narrow."
The change has been rapid. “Today, in the city of Riga, we see very positive and committed people, officials who really want to build the city of the future in the best possible way,” says Vähi. “Our local governments have a lot to learn from there.”
The Singing Revolution and Competitors
Käki's youth was the time of the Baltic chain. "Three brave little countries fought for their freedom while singing. Shoulder to shoulder, it was a proud feeling." This was followed by a couple of decades when Estonia and Latvia grew apart. Russia's war in Ukraine has changed that — but the situation is still not satisfactory.
While recently spending a weekend in Riga, Vähi discovered something disturbing: “I heard Finnish everywhere in public spaces, but practically no Estonian. I thought to myself that something is wrong here now.” His advice is: “We should open up more, not be so confident Nordics. We are very welcome there.”
The article was first published on May 28, 2026 as a content marketing story in Õhtuleht.
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