Croatian Hotel Company and French Consortium to Invest in Croatia?

Lauren Simmonds

As Novac/Goran Penic/Barbara Ban writes on the 23rd of August, 2019, the Croatian Ministry of State Property extended the deadline for the submission of offers for the construction of a tourist complex at the location of the Hidrobaza in Pula, owned by botj the state and the City of Pula, back at the beginning of the week. Investors now have time to report their offers by October the 1st, as opposed to August the 30th, 2019.

According to the aforementioned ministry, two investors sought an extension due to the summer break, but the ministry did not disclose any names. As Novac reports unofficially, this involves the largest Croatian hotel company, Valamar Riviera, based in Poreč, Istria, which owns Camp Brioni next to Puntižela, and the French group Bouygues, whose branch in Croatia has a concession over Istria’s Ypsilon.

Upon being asked about this situation, Valamar Riviera did not want to confirm or deny any information.

Valamar Riviera has remained unable to answer the question of whether or not Valamar has expressed interest in the Hidrobaza location in Pula, given that the deadline for the submission of bids is only the 30th of August.

”After the deadline for submission of offers, we will be able to answer your inquiry,” said the largest Croatian tourist company, which is already known to the public as a large investor. This year alone, the giant Croatian hotel group has invested as much as 793 million kuna in its portfolio, and is preparing a new investment cycle of 599 million kuna for the next one. In recent years, they have invested as much as 5 billion kuna in Croatian tourism.

The French Bouygues Group has already invested in Croatia, but not in the hotel industry. They are known as dealers and contractors at the Istrian Ypsilon and at the Zagreb’s new Franjo Tuđman Airport. They are currently expanding the Ypsilon on a 28-kilometre stretch from Pazin to Učka. It is an investment worth 1.237 billion kuna, which will be realised within the next three years. Projects in tourism are very close to them, though, and they have built twelve hotels across France, the Caribbean, Myanmar, Morocco, Dubai, London and Cuba.

However, despite the fact that there are two very serious names behind this project that have great references in Croatia, in the Croatian tourism sector there is still a great deal of skepticism about the realisation of it all, probably because of past experiences that have not been the most positive.

These tenders have always been extended, and until now, a concession has been given within the Brijuni Riviera only for the Katarina-Monumenti location, namely to Danko Končar, who still has not realised his meganautical project in the port of Pula to this day. A source who is very familiar with the circumstances surrounding the Brijuni Riviera project believes that the tender conditions are quite restrictive.

”One of the limiting factors is that there is a public beach in front of the future tourist facilities. If one wants to build a hotel, of course they then want to have a part of the beach as well. On top of that, some of the facilities there are under conservation protection, so the investor must adapt to that as well,” explained Novac’s interlocutor. He also stated that it should finally be understood that investors need to be offered something in order to make them actually invest, and that the beauty of the Croatian coast and Istria is not the only thing that is crucial in investment stories.

Otherwise, the Hidrobaza location covers an area of ​​281,000 square metres, and construction rights are possible for fifty years. The initial value of the annual building rights fee is 2.3 million kuna, which will be revalued every three years. The deadline for the construction of a 1200-star four-star tourist destination is five years.

Pula Mayor Boris Miletić stated that he has been formally notified of the extension of the public call, however, while the proceedings are ongoing, he claims he has no knowledge of potential interested investors or potential bids.

”Every serious investor needs some time to elaborate on their offer. For Pula and all the people of Pula, that entire area, as well as other formerly unused and decaying state-owned military areas, are of great importance and development potential. It is our interest that the state, as the owner, put them in the function of development, as this would enable the creation of new jobs and accelerate the economic growth of Pula,” said Miletić.

He added that the new facilities and the higher standard of living of all the people of Pula is what they strive for, which can be ensured by putting neglected and unused spaces properly back into operation.

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