Practical Insights of Investing in the Batumi Real Estate Market
The current global economic and political landscape has created a shift in the real estate market, making Batumi a prime location for investment. In this interview, we speak with Giorgi Kasradze, the Executive Director of ELT Building, about the current state of Batumi's real estate market, what differentiates the company from rivals, and their upcoming plans for 2023.
What are the triggers for Batumi real estate market's investment attractiveness?
The current political and economic circumstances has caused individuals to rethink their living situations, leading many to seek out smaller cities like Batumi with a better quality of life. With its stunning coastline boulevard, growing tourism industry, and favorable investment climate, Batumi is quickly becoming one of the most attractive real estate markets in the region.
Meanwhile, political instability in neighboring countries has encouraged investors to turn to Batumi as a safe and favorable business environment.
But the appeal of Batumi goes beyond just its current circumstances. The Georgian government has been working tirelessly to promote tourism and attract foreign investment, signaling that the city's real estate market will continue to flourish in the long run. With its breathtaking scenery, rich culture, and welcoming community, Batumi offers an unparalleled lifestyle that appeals to both locals and foreigners alike.
Bit in depths, the Average weighted sale price for residential real estate per sq.m. went up for 2% compared to 2021 caused by 123% increase in rent process; consequently rental yield raised for 5 pp up to 10.2% annual, the very first time it exceeded Georgian banks annual interest rates for deposits; (TBC Capital H1, 2022). Accordingly, the projections are much positive for selling price further growth for 2023;
It should also be considered unambiguously, that investing in real estate is not only a smart financial decision but also a way to achieve your lifestyle goals. Imagine owning a property in a prime location, with stunning views, engaging amenities, and the potential for rental income.
What differentiates ELT Building from rivals?
Investing in real estate is a big decision, which is why it's crucial to work with a reputable developer who has a successful track record and a proper vision. At our company, we prioritize providing consultation to potential partners/clients who want to buy an apartment for investment purposes. We are proud to be one of the top choices for investors who seek to generate rental income. Recent years have shown that Batumi's real estate market has developed mainly in one direction. When we started developing and building “ELT Quarter”, we conducted research among international and local audiences of potential investors. The results dictated our development concept, which is a semi-closed neighborhood concept with shared services and infrastructure.
Besides these factors, sustainability of the company is an absolutely decisive factor when purchasing real estate, and it is also one of the indicators for creating a competitive advantage; “ELT Building” is the member of ELT Business group, owning the biggest non-banking financial company in Georgia (ELT Company Finance); our self-funding policy gave us advantage to overcome rivalry and offer the most tailored installment plans for our clients/partners;
When considering your investment goals, it's important to align them with the local market. In Batumi, it is desirable and justified to invest within the city scopes. There are several reasons for this, including the high demand for properties in the most popular area for tourists and visitors. This can make it easier to find tenants and generate rental income. Moreover, the city area is typically more developed, with better access to amenities such as shops, restaurants, and public transportation. This makes it more attractive to tenants and can increase the value of your investment over time. Additionally, properties in the city area of Batumi have a higher potential for appreciation in value over time, due to the high demand and limited availability of properties in this area.
We also place great attention on resale value, as properties in the city center of Batumi may have a higher resale value than those in the suburbs. This is because they are more desirable and in higher demand. Furthermore, investing in the suburbs of Batumi may be less attractive, as there may be lower demand for properties in these areas and fewer amenities and attractions to attract tenants;
And what about your upcoming plans for 2023?
By the end of 2023, we plan to put 500 new hotel-type apartments into operation in our “ELT Quarter”, further expanding our successful model in Batumi. We are also excited to announce our entry into the Tbilisi market in 2023, offering a new dimension of living environment under the same, “Quarter” concept, complete with shared services and infrastructure.
My pleasure to announce, that presentation of Tbilisi project and start of pre-selling is scheduled for 1 June 2023.
Furthermore, we are working consistently on developing the partnership with an international brands to expand our successful model for Batumi and Tbilisi market; Negotiations are on closing stage with some of the very reputable and famous European hotel brands and hotel management companies to join us in our ongoing and planned projects;
Not of less importance to create, raise and keep customer satisfaction in our existing projects; well-known hotel management company “River Rock” is already onboard in our “La Quinta by Wyndham”, “Wyn Residence” and “Sunrise” complexes to ensure the most efficient management and higher income for our investors and clients;
Much grateful for your time and such an interesting dialogue, hope our readers will catch the trends and consider your insightful suggestions;