Issue 1, 2016. February-March

   

BUILDING THE FUTURE: AN OVERVIEW OF MAJOR NEW PROJECTS PLANNED IN TBILISI

The Tbilisi horizon is constantly changing, and with more major projects underway - from the Georgian Co-Investment Fund's Panorama and Axis Towers developments to the Tbilisi City project and the plans for a new park and recreational area on the site of the 2015 flood - the skyline of Georgia's capital could look quite a bit different in a few years. Investor.ge spoke with developers and specialists about their plans and the demand for Tbilisi real estate.

Lika Jorjoliani

Forty-one story skyscrapers and multi-million dollar developments. It is hard to miss the building boom in Tbilisi - or the new trend for developers to focus on large, multi-functional projects rather than apartment blocks. New apartment and office complexes are going up in nearly every district of the capital, and even more are rumored to be starting in the suburbs.

Georgia's Twin Towers

"According to the Georgian Co-Investment Fund website, once they are completed in 2017, the double, 147-meter, 41-story skyscrapers planned for Vake will be the highest buildings in Tbilisi.

An $83 million project, the Axis Towers will include a five-star hotel operated by the high-class French international brand Pullman in the glass tower, as well as an A-class business center. The stone town will house 15,000 square meters of apartments, according to the website.

The Georgian Co-Investment Fund is also working on a major project on the other side of Tbilisi, the $500 million Panorama Tbilisi project. This development, which has inspired protests, includes four hotels in Tbilisi's historic Sololaki and Freedom Square neighborhoods. There are also plans for a massive parking garage and the the project's developer reportedly intends to plant 30,000 new trees, according to Georgian Journal.

€130 million Green Valley City

The UAE-based Green Valley International Real Estate Group is reportedly planning to invest $136 million in an 88,000 square meter development in Tbilisi, according to Arabianbusiness.com.

The company did not respond to requests from Investor.ge for comment. A Green Valley press release, however, noted that the development will include 10 buildings made up of 510 units - studios, one-bedroom and two-bedroom apartments - and a private district with luxury villas.

New Projects in Saburtalo, the Right Bank

Business Group Valencia, together with ARCHI Group, is developing "Tbilisi City," an approximately 200,000-square-meter project in Saburtalo. There are also plans for the construction of a four-story commercial center, with an entrance directly from the metro station.

The center will be constructed at the intersection of Pekin and Saburtalo streets, according to the current plan, noted Business Group Valencia's Zurab Agladze.

The $100 million project is still in the early stages of development, however: an environmental impact study is still being prepared, and talks are underway with residents who would be affected by the new complex.

The Azerbaijani AS Group Investment started construction of the Dirsi complex in 2012. The $150 million investment is already built, according to the head of marketing and sales, Keti Adeishvili.

"Our company is an innovator in complex construction," she said.

"It is very difficult to determine the economic and political factors that are sensitive for the real estate market in advance. ... We implemented preliminary investments equal to $150 million in the development of the [Dirsi complex's] infrastructure. Within two years we completed construction and started active sales," she explained.

366 Projects

There were 366 residential developments underway in Tbilisi in the first quarter of 2015, according to a 2015 Colliers report on Tbilisi's residential real estate market.

Large-scale developers, Colliers reported, made up 17 percent of the projects under development.

While overall sales were down in the first quarter of 2015 compared to the same period last year, demand was strong for small apartments in general and luxury apartments in Vake, the report noted.

"The vast majority of demand distribution occurred in the Saburtalo District, with 25% of the total transactions. The largest share of transactions are small-sized apartments (<50 sqm). This trend is more significant in suburban parts of the city, such as Chughureti, Gldani, Nadzaladevi and Samgori, where small apartments (up to 70 sqm) represent almost 50% of the transactions," the report noted.

"The Vake district is an exception, with large apartments (150-250 sqm) comprising the largest percentage of total district transactions, followed then by the Krtsanisi and Mtatsminda districts."

The dip in sales in 2015 was due to the Georgian lari's fluctuating value compared to the dollar, the report said.

Driven by Demand

Demand for apartments is still high, however, according to the director of the property company Erdo Group, Guram Palavandishvili.

"Today, many people desire to buy new flats to replace their old accommodations," he said.
Business Group Valencia's Agladze added that there is a real lack of facilities for large-scale international events and forums. "I would like to note that, in fact, problems occurred in the process of holding the "Silk Road" forum in Tbilisi... it was difficult to place all the guests, since there were not enough accommodations," he said.

"That means that we need buildings for large-scale forums and seven-star hotels for high-class guests and "A" class offices," he explained.

A New Central Park for Tbilisi

The plan chosen by the Tbilisi Mayor's Office to redevelop the area destroyed by the 2015 flood envisions a 20,000 square meter educational center, a sports complex, a park, bike paths and pedestrian parkways.

The education center will include a library and conference halls, and "green bridges" will connect Mziuri Park with the territory that is currently the zoo, according to the winning proposal.

The zoo will be moved to the Tbilisi Sea suburbs, and the space it currently occupies will be included in the park.

The proposal also includes plans to limit traffic on the highway that runs through the gorge to public transportation.

Mikheil Baliashvili, the director of Architectural Bureau, the company behind the winning proposal, said the final concept will be submitted to mayor's office in February, and City Hall will hold a tender for engineering details after that.

Chairman of the Architects' Union David Abuladze supported the idea of restricting traffic on the highway. "This is a good initiation! At the first stage the main highway will serve as a parkway for city and private transport, and in the final variant only public electric transport, which will serve the people using the recreational zone, will utilize it," he said.

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