The tiny Balkan state of Montenegro is seeing an influx of foreign buyers on the heels of prime property development, with offerings ranging from high-end resorts to yacht-friendly communities.
Often referred to as the Monte Carlo of the Adriatic, Montenegro is known for its stunning landscape, unspoiled coastline with picturesque views (especially along the Bay of Kotor), stone Venetian architecture and historic properties in places like Kotor Old Town, a Unesco World Heritage site.
The transformation of the coastal nation began shortly after its independence from Serbia in 2006 when the former naval base at Tivat was sold to an international consortium led by Canadian billionaire Peter Munk. The site is now the home of Porto Montenegro, a luxury marina and resort village that was among the first to establish Montenegro as a potential rival to luxury hotspots like Sardinia and the French Riviera. The project began in 2008 with 85 berths and one building. The marina now has 450 berths and plans to reach up to 800 berths. To date, Porto Montenegro has unveiled 188 units across six residential complexes.
Ksenija is the latest luxury residential development within Porto Montenegro. It hit the market in July with 48 apartments, a pool, a gym, and a number of retail units. Only two residential units remain on the market, according to Danilo Kalezic, manager of public relations at Porto Montenegro.
Nearly 80% of the buyers at Ksenija are foreigners, including a good number from the U.A.E., says Kalezic. In 2014, U.A.E. nationals were exempted from Montenegro’s visa requirement.
Regent Pool Club Residences, another project within Porto Montenegro, is currently under construction. It will offer contemporary luxury apartments with sea and mountain views. Homeowners will have access to services and amenities of the Regent Hotel at no additional fee.
The size and pace of development is not limited to Porto Montenegro.
Within the golden triangle of Tivat, Kotor and Herceg Novi, current and planned developments are forecasted to attract some €2.4 billion ($2.7 billion), according to the Montenegro Second Homes Market Report published by Dream Estates Montenegro, an international associate of Savills. That is equal to over two-thirds of Montenegro’s current annual economic output over the next five years, with five-star hotels expected to be the catalyst for serious property market growth.
Among the shiny new developments in town is Luštica Bay, a new, residential, resort-based town. With a total investment of €1.1 billion ($1.25 billion), the project plans to offer seven hotels, over 1,000 apartments, over 500 residential villas and townhouses, and two marinas with mooring and docking support facilities for 226 berths. The low-density development sits on a 690-hectare site where only 6% will be developed.
The project will be constructed in several phases spanning decades and, when complete, will be a new town in Montenegro with a permanent population of several thousand residents, according to Slavica Milic, a senior marketing executive at Luštica Development.
International investors have already snapped up €51 million ($58 million) of luxury residences at Luštica Bay, according to Milic, and 145 units have been sold so far. Buyers at the resort include Serbians, Russians, Egyptians, Germans, British, Swiss, French, Belgian, Canadians and Americans. The first 70 residents moved into the property in May.
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Correction: The Montenegro Second Homes Market Report was prepared by Dream Estates Montenegro, an international associate of Savills. A previous version of this article only listed Savills as the report’s author. (Oct. 20, 2015)