Due to the new law, investors in tourism are establishing an association

An Association of Investors in Croatian Tourism has been established in Zagreb, bringing together more than thirty domestic and international investors in hotel complexes, resorts, and marinas. The establishment of the association followed the announced amendments to the Spatial Planning Act, which, according to member estimates, could jeopardize investments worth €4.8 billion and thousands of jobs in the tourism sector.

The Ministry of Spatial Planning proposed a model that would limit fractional ownership in tourist zones, specifically the possibility of selling individual parts of tourist complexes. After criticism, the ratio was temporarily adjusted to 30:70 in favor of the part that can be fractionally owned, but investors believe that this model is also unsustainable.

The association warns that such regulation would reduce Croatia’s competitiveness compared to other Mediterranean destinations, such as Spain, Italy, or Greece, where fractional ownership is permitted and legally regulated. In addition to economic effects, investors highlight legal uncertainty, as fractional ownership is primarily regulated by the Property Act and other real rights.

According to their estimates, the state budget could lose around €300 million annually in taxes and contributions due to reduced investment activity. Among the members of the association are investors behind projects such as Medine Resort, Katarina Monumenti, Rijeka Gateway, Loreta Beach Resort, Terra Istriana, and other significant investments in hospitality and nautical tourism.

Representatives of the association state that they are not acting against the state, but rather wish to point out solutions that, in their view, would make Croatia the least attractive investment destination in the Mediterranean. They emphasize that similar restrictions do not exist in any other EU member state.

As an alternative, they propose a 50:50 ratio model, where residential units would be defined by gross area rather than the number of beds. Additionally, they request that fractional ownership be allowed in high-category facilities (4 and 5 stars), with mandatory centralized management through licensed operators to prevent apartmentization.

The association also advocates for a five-year transitional period for all projects already in development with issued permits or commenced works, and for the harmonization of rules with those applicable to camps.

Investors warn that limiting the mixed model – hotels and residential units under common management – could lead to capital withdrawal towards markets that do not have such barriers. This model, they state, is the standard in developed tourist destinations and is crucial for the financial sustainability of luxury projects.

The newly formed association appeals to the Ministry of Spatial Planning to consider their proposals, emphasizing that the goal is to preserve investment activity, jobs, and the international competitiveness of Croatian tourism.