Georgian Developers Use Thaw To Draw Russians To Southern Climes
- By Alexander Bratersky
- Sep. 17 2013 00:00
Tourism dominates the economy of Batumi, which also includs shipbuilding, food processing and light maufacturing.
When Russians and Georgian expats living in Moscow came to Crocus City this April to see the long-awaited performance of Rustavi folk dance group, the concert's main sponsor was urging them† to buy real-estate in Batumi, the Black sea resort in Georgia.
Georgian developer Orbi Group, recently opened an office in Moscow following a thaw in Georgian-Russian relationship after the short military conflict in 2008 over the breakaway republic of Ossetia.
"There is no diplomatic relationship between Georgia and Russia, but people were coming to Batumi and looking to buy apartments, learning about them on the grapevine.† So we decided to come over," said Nana Kassa, Orbi group representative in Moscow, based in Baumanskaya.
Even if sales drop, we have the money to complete the project.
Fifty percent of the buyers of real estate projects offered by Orbi Group are Russians. While Georgian companies still have a low profile in Russia due to political uncertainty, Orbi Group which entered the construction business in 1997, became the first major Georgian developer on the Russian market.† Kassa said that the company will soon open an office in St. Petersburg catering to† Russian clients who are ready to pay up to $1,500 per square meter to own an apartment in a residential complex in Batumi, a Black Sea resort and the capital of the autonomous Georgian republic of Ajara.
The price gap is such that some wealthier Russians did a double take, mistaking $21,999 as the price per square meter. In fact, small studio apartments within the residential complex start from between $20,000 and $30,000. Owners can rent them out for around $100 per day.
The company provides loans to foreigners through Georgian banks, although rates, starting from 11.9 to 13 percent are high, even by Russia's own elevated standards.
While some from the older generations are driven by nostalgia to spend time in what was once a popular resort of the Soviet Union, others are driven by quality of life and the chance for entertainment. Batumi is known for its nightlife, bars and casinos.
A city of 180,000 people, Batumi attracted half a million foreign tourists in 2011. The resort has undergone a facelift during the rule of outgoing Georgian President Mikhail Saakashvili who visited the complex construction site last August.
"This is how Donald Trump began his business and he is now building half of the world," Saakashvili enthused during his visit. "People often say that foreigners have bought everything in Batumi and they are constructing it. I would like to point out that Orbi Group is a completely Georgian company,"
In March, the company unveiled the 22-story Orbi Plaza aparthotel of 850 suites which sold out and it is currently finishing the construction of its main project the Sea Towers residential hotel complex, which consists of two 25-storey towers and another of one 34 storeys. The Sea Towers complex of 1,900 suites will be completed by November. †
The company has other projects in Georgia including a 4 star hotel in Bukuriani ski resort, to be unveiled soon. But it sees† Batumi, where it owns† its own cement plant, as its home base. "Even if sales were to drop, we have the money to complete the project," said Kassa.
The developers claim to have attracted as purchasers several Rus≠sian celebrities, television hosts and even a well known film director.