Issue 6, 2014. December-January

   

DEVELOPING TBILISI'S SUBURBS

Tbilisi's outlaying neighborhoods and adjacent villages are primed for a major shift from Soviet-apartment block planning to posh new residences and businesses.

Maia Edilashvili

Hualing Group Georgia

Tbilisi's "concrete canyons" and congested roads are driving new demand for suburban housing, say urban specialists and developers.

In the past, living in a suburb - Varketili, Vazisubani, Gldani, Temka, Mukhiani and Didi Dighomi- was widely looked down upon, but now moving to a suburban area is coming into fashion, according to urban planner Lado Vardonasindze.

"We are witnessing a suburbanization, where many economically strong households prefer living in ecologically clean areas surrounded by nature and beautiful landscapes, and this process shows also the economic differentiation of our population," believes Vardonasindze, a professor at Georgian Technical University. According to Vardonasindze, this trend is a response to overpopulation in Tbilisi's prestigious central districts - Vake, Vera and Saburtalo. "Concrete canyons have occupied these districts, and as a consequence, we will see that, first, high-income populations will be moving to suburban areas, while later, middle-class households will follow suit," he told Investor.ge in an interview.

Development in the 'burbs

The Georgian government changed Tbilisi's boundaries in 2006, a move that has helped foster suburban development. The new borders expanded the capital from 380 square km to 500 square km to encompass several adjacent villages - Tskneti, Kiketi, Kodjori, Betania, Tabakhmela, Shindisi, Tsavkisi, and Oqrokan - previously considered recreation zones.

Click to enlarge the image.

And businesses were quick to respond. Georgian investment company Delta Invest, established in 2010, has developed a project for a gated community called Atrium on a road connecting Tbilisi and the village of Kodjori. The complex unites 30 two-story houses with a green terrace, while on the inner area - a 2,500 square meter space - parks and recreation facilities will be arranged.

SunCity Tskneti, a Georgian-American Village located approximately seven km away from Tbilisi center, illustrates this trend. The residence complex unites 41 privately owned, luxury residences, complete with a parking area, private roof-top terraces and balconies with a panoramic view of Tbilisi's skyline.

According to Georgian businessman Vasil Tsotadze, who is in charge of the project, this is a "different-concept" settlement. "When you get here exhausted and stressed driving from Tbilisi, you will have a rest and unwind," he told Rustavi 2's Business Courier. Future residents of these townhouses, who will buy both space and a new lifestyle image here, have to buy at least a 150 square meter space, with a starting price of $ 1,000 per square meter, which is close to the price as one typically finds in central Tbilisi districts.

Expanding to the East: A New Logistics Center and Shopping Mall

Lisi Development, Lisi Lake, Tbilisi (Mari Nakanimamasakhlisi)

Tbilisi's suburbs are attracting investors not just for developing residential space, but also for commercial activities. Such territories, when used wisely, can generate both capital and trust for the country, government representatives say.

Opened in September 2013 by Austrian transport and logistics company Gebrüder Weiss (GW), a modern logistics center near the Tbilisi International Airport, with about 10,000 square meters of transhipment and logistics space, has already started to serve as a central hub for the Caucasus. The company offers multiple services including overland transport, air and sea freight and logistics solutions. GW invested approximately $10 million in this project.

In 2015, again in the eastern suburb of the city, Tbilisi will see the inauguration of yet another grand project. CBD Development, a Georgian subsidiary of Quadrum Property Group, an international development company, will open an 85,000 square meter shopping and entertainment center called East Point.

East Point Tbilisi will feature a 27,000 square meter outdoor fashion mall on the Kakheti Highway, connecting the city center with Tbilisi International Airport, and will cost approximately $90 million.

A deal has already been reached with one of the large retail companies of the Kingdom of Saudi Arabia, Al Hokair, which will be present with 16 brands at the opening, the marketing director Teiko Lominadze told an online portal, Marketer.ge.

Olympic Preparations Accelerate Another Large-Scale Development

Another development at the Tbilisi Sea reservoir is the Chinese HualingGroup project, located on a territory of 420 ha between two suburban districts of the capital - Vazisubani and Varketili.

The project envisions construction of an Olympic village that will host the Tbilisi 2015 European Youth Olympic Festival scheduled to start on July 26, as well as building of a shopping center on a 110,000 square meter territory, with the plan to make it a leading shopping center in the Caucasus.

Under the agreement, the village - which encompasses nine residential blocks, and includes a five-star hotel - will be handed over to the state for a three-month period in March 2015 - after which it will be sold as private property.

Untapped Potential?

Prof. Vardosanidze, who has participated in infrastructure projects implemented by the World Bank, believes that the best thing the Georgian government can do to help the natural development of the city is to continue the Tbilisi Bypass project, which the previous government launched in 2010 to construct a new railway route bypassing central Tbilisi. The goal of the project was to move hazardous freight away from the center of the city and open space for new urban development.

"This project, among many other benefits, has a business angle: we will get free territory of up to 80 ha which can be rationally used to arrange a CBD (commercial business district) area as well as parks and boulevards, which we currently so badly lack," Vardosanidze said. "This is a historical chance and we cannot miss it. Let's move beyond politics, because city development is a phenomenon which has nothing to do with party interests."

Vardosanidze told Investor.ge that he has voiced his recommendation at a recent meeting on modern challenges facing urban development and during a series of consultations with the field's experts that was initiated by city hall.

More Planning, New Strategy

"We will identify where the loopholes are in this area and come up with concrete decisions," Tbilisi Mayor Davit Narmania told Investor.ge before the meeting. "Previously, there was no plan for spatial development of Tbilisi. In December, we will launch work on that and submit it for consideration next year."

Nino Gogoberidze, chief of the Tbilisi architecture service, told Investor.ge that the architectural plan of Tbilisi's suburbs in not currently on the agenda but will be detailed in the capital's strategic plan. According to Gogoberidze, by the end of December two tenders will be announced for a strategic plan for the city and on the general plan for land use, where "the capital's future development will be outlined, including cooperation with the private sector."

However, Vardosanidze maintains that there is no need for new tenders and no need for spending money because such plans were developed just a fewyears ago "at a pretty high level." What is needed now "are just corrections." Instead, he believes that the most important thing for Georgia in terms of urban development is to introduce the United Nations' City Development Index.

The Urban Indicators Programme of the UN Human Settlement Programme (UN Habitat) ranks cities according to their level of development.

"We need these indicators to be able to measure the city's 'temperature,' and this will largely benefit potential investors, too, in the decision-making process," Vardosanidze said.

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