The Minister of State Property, Goran Marić, assessed on Monday that the Kupari tourist complex project has been stalled for two years and that there is a possibility of terminating the contract with the investor company Avenue ulaganja, while the company claims they are surprised by this and that they respect all obligations.
– Personally, I would never have announced such a tender as the one for Kupari, so unclear, and due to such poorly prepared tender and selection, we have a standstill for two or however many years on that project. We cannot influence what the investor will do, but we in the Ministry of State Property have analyzed the entire project and I think it is very difficult to expect its continuation, emphasized Marić at a press conference where he answered a series of journalists’ questions, including about Kupari.
Marić says that the investor is not fulfilling their obligations and that, if they conclude that it is impossible to implement, they will be forced to consider terminating the contract.
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– If we decide to terminate the contract, we will clearly state why, due to non-fulfillment of contractual obligations, and the fact that someone wants to change the tender conditions after the tender has been conducted is not the Ministry of State Property’s problem. I would be very happy, as would all my associates, if they realize the project according to the concluded contract and my intention is not to terminate that contract if they fulfill their obligations under the contract, but we can no longer delay because it is to the detriment of the Republic of Croatia, said Marić.
The minister also stated that they are in talks with the Ministry of Defense to take over a hotel facility Kupari 2 from them, which is not serving its purpose and is not a prospective asset for the Ministry of Defense.
Paladina: We do not understand what this is about
Co-owner and director of Avenue ulaganja, Ivan Paladina, commented on Monday in response to Hina’s inquiry about the minister’s words as “extremely surprising,” adding that they “cannot find themselves in that statement”.
– The project cannot be stalled for two years, as it has not even been that long since the contract was signed, says Paladina, emphasizing that they have already done a lot on the project and that they absolutely respect all contractual obligations.
He reminded that just over six months ago they proposed certain changes to the project or conceptual solution, whereby they reduced the number of accommodation units from 400 to 200, increased their areas, and raised the entire complex to an even higher level – ultra-luxury.
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They have also discussed this with a new hotel operator, after they withdrew from cooperation with the original Ritz-Carlton.
– From the beginning of communication with representatives of all involved ministries with whom they had several meetings, always with about ten people, no one has ever said that this does not suit them and we continued to develop a new concept, said Paladina, adding that such a stance was supported at the last meeting at the end of July 2017.
According to him, at the beginning of November, such a change of concept was accepted in writing, and in December, Avenue ulaganja was provided with a proposal for an annex to the contract in which all of this was accepted, including the change of operator, with the note that it should be “top-notch”.
– Despite the fact that this annex has not yet been signed, we have signed a letter of intent with the new operator, which we reported to the Ministry of State Property last week, said Paladina, adding that he cannot say more about the new operator for now.
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Paladina also says that Avenue ulaganja has no problem even if the annex to the contract is not signed, as they will then implement the project as initially planned.
– They could have told us eight months ago that they do not accept the changes, we would have continued the project implementation as we initially reported, and not have them support everything and now have different statements. Perhaps all of this has to do with something completely different, but I do not know what, concluded Paladina.
The contract for the realization of the Kupari project was signed by Avenue ulaganja at the end of March 2016, planning a partnership with the prestigious international hotel chain Marriott with the Ritz-Carlton brand, and to invest just under 100 million euros in Kupari over four years, to build two five-star hotels with about 400 accommodation units and one villa, all at a very luxurious level.
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At the beginning of December last year, however, the company announced that they plan to invest around one billion kuna in Kupari to become an ultra-luxury resort.
By the way, the government decision accepting the offer of Avenue ulaganja for this project relates to three concessions granted for 99 years, namely for the establishment of building rights, for the lease of the Grand hotel, and for the maritime good for the purpose of constructing and economically using the beach in the Brašina area. The investor offered 172 thousand euros annually for the compensation for establishing building rights, 58.5 thousand euros for the annual lease of the Grand hotel, and compensation for the concession on the maritime good of 8.10 kuna per meter (about 640 thousand kuna annually) as a fixed part, plus a variable part of the concession fee of 3 percent of the total annual income generated from providing services on the beach.
