IRAKLI BURDILADZE Chairman of supervisory board of m2.
Demand for residential real estate in 2014 has increased as compared to 2013. Numerous transactions that took place in Tbilisi this year stand as a proof to this. We predict that next year this figure will exceed last year’s by 5%. It is also worth noting that growth of Georgia’s GDP amounted to 5,9% this year — real estate was a significant contributing factor to this figure. In the third quarter of 2014, foreign direct investment (FDI) constituted 507 million US dollars. A significant part of this money was directed toward the real estate sector. Specifically, 32% was invested in the construction sector; 12% in the real estate sector. The boosted activity of the real estate sector in Georgia is a result of these investments for the major part as well.
In 2014, the company launched a new product, Optima. It represents apartments gained by effective planning strategy, the prices of which are significantly lower than those offered by our company before, and are geared towards a wider segment of the population. For example, fully renovated two-room apartments start from an equivalent to $29,000, which is a very attractive offer to our consumers. Optima’s projects successful sales are a proof of this. We started the project at the end of September, and by today we managed to sell 44% of all the apartments.
Now the company is actively involved in the preparation of some projects. We intend to offer a new residential complexes in different parts of the city. Saburtalo remains a priority for our concentration. We believe that in 2014 at least 2 exciting new project will start.
Since the crisis in 2008, the real estate market in Georgia and Tbilisi specifically has been experiencing a dynamic growth. Contract numbers grew annually. For example, on an average basis, Tbilisi had 13,000 to 14,000 contracts in the real estate sector in 2007-2008. According to our estimations, this index is currently increasing, and passing the 20,000 mark. As to the rate of the price growth, it’s not high. During the last several years, we have only dealt with a 10% growth. By our forecasts, the positive tendency will carry on in 2015, as well. We think that the number of carried out contracts on the real estate market will slightly increase compared to 2014. As to the prices, we’re not waiting for big changes there.