Apart Development is one of the fastest-growing representatives of the development market in Georgia. The company, established in 2019, already has the status of a third-category enterprise, next year it is planned to upgrade to the second category. The company started work two years ago with a building area of 2500 sq.m., and now this figure exceeds 15,000 sq.m. The rapid growth of the team is associated with the first bold step – the start of a large-scale project in Old Tbilisi. We are talking about a Panorama of the Old City, which provides for the renewal of old districts. We talked to the founder of Apart Development, Beka Khoperia, who founded the company on his own experience of development and management.
The company “Apart Development” was founded two years ago, when the development market was already quite saturated. It should also be borne in mind that the pandemic began shortly after the company was founded. Nevertheless, you still managed to grow up. how?
The project “Old Tbilisi”, which we are currently working on, has an interesting concept, which has few analogs in the Georgian market today, so, probably, this is the key to success. A qualitatively multifunctional premium-class complex turned out to be in demand, which led to the beginning of new buildings of a similar type on our part. Among them is the renovation project of old buildings on Bukhaidze Street and others.
As for the pandemic period, it was really difficult for many companies to cope with this challenge — some stopped working altogether and sent their employees home, and fortunately, we found the material resources to hire even more people both in construction and administration, and this, of course, strengthened us with a team that constantly supports and they feel each other – when a company needs an employee’s support, and when an individual employee needs the company’s help.
As we have already mentioned, you initiated the responsible project “Panorama of the Old City”, which includes the replacement, strengthening, and repair of facades of various dilapidated houses in old Tbilisi. How is the process progressing and what problems are you facing?
In general, it should be noted that it is quite difficult to obtain a permit for new construction in the Tbilisi City Hall in Old Tbilisi since historical monuments are located here. Therefore, many companies simply should not start construction with an understated profit, and with all this, they do not meet the requirements. And for us, it is a certain social and civic responsibility to strengthen beautifully, even emergency buildings, even if it is financially more profitable to build in another area. Problems are encountered at every step – for example, there are a lot of groundwater and rocky slopes in the Chuguret district and this requires high-quality reinforcement and isolation, which requires considerable financial resources and the involvement of specially invited specialists. It is also very dangerous from an architectural point of view to erect a modern building in old Tbilisi, on which our very experienced architects Daduna Shatashvili and Nika Chkheidze are working. We are constantly consulting with the Cultural Heritage Council of the Tbilisi City Hall regarding the appearance of the building.
In the end, I know for sure that the project created as a result of so much effort, thought, and finance will definitely pay off, and take pride in place in the heart of the city.
Right here we will ask you one of the most problematic questions for Tbilisi… How do you imagine the urban development of this city?
The urban planning of the city is such a large—scale topic, at this stage I prefer to talk about the narrow direction that we are engaged in together with my team and architects. We work in one of the small districts of Old Tbilisi, and here we also pay great attention to every detail, thanks to which there is an organic fusion of old and modern architecture
For me, as a citizen of Tbilisi, it is very important to preserve the charm of the city that I like and have loved since childhood. That is why on the facades of our projects there are fragments of old Tbilisi balconies, the charm of Georgian bricks, etc.
Speaking again in the direction of Old Tbilisi, it is important that the planning of traffic patterns on these narrow and small streets is carried out correctly. It is also important to preserve multiculturalism when families of different nationalities lived together in the city center and respected each other’s traditions. I am glad that such a prospect is great in our complex because we have both Georgians and residents of different nationalities who love our city.
About 71% of permits issued in Tbilisi in recent years relate to residential real estate. In your opinion, how much can the residential real estate market growth in the capital?
I do not want to look at this process from a political point of view, but it is clear that, perhaps, at one time, more attention and rigor were required, compliance with certain standards to those bodies and persons who issued building permits relatively easily. In general, we probably would not have such a “concrete city” today, as in the sad reality we received it. However, I see and rejoice that the correct vision of the urban development of the city is slowly being formed and approved. Although our work in this regard is becoming more complicated, from the point of view of a citizen, I welcome the tightening of the requirements of the architectural service of the city for builders, which gives hope that the city will retain its former charm, and new, properly planned architectural projects will be in place. Therefore, if we plan this direction correctly, the market will grow and the quality of construction will increase, which we welcome.
How will the devaluation of the lari and the associated increase in prices for building materials affect the prices of the real estate you offer?
The change in the exchange rate of the lari and the radical increase in prices hit the real estate business very hard, however, because we already work with the highest quality materials, and besides, we are builders ourselves, this calculation was taken into account in the pricing process. Therefore, we have not increased the prices of apartments due to increased costs, but I understand those developers who depend on others and are forced to adjust costs with rising prices.
How necessary is a subsidy in this process? The head of the association of builders believes that the subsidy program should be continued, since at this stage it is vital for the development business. What do you think?
The state launched the subsidy project at the very right moment and thus stabilized the already more or less chaotic market due to the pandemic. After some time, when the project ended, the developers themselves financed the banking sector in this regard, we subsidized mortgage loans for tenants, but as we mentioned above, construction costs are so expensive that if the project continues with state funding, it will help both sides.
According to Colliers Real Estate Review, in October 2021, the economy segment of new buildings decreased by 16% compared to 2019, the middle segment increased by 8%, and the premium segment decreased by 27% compared to 2019. What are your expectations for 2022 in this regard?
In 2020-2021, probably, all branches of business passed on the verge of profit and loss, and only vital, strategic business entities saved the country’s economy, which developers cannot boast of. Regardless of whether we had the financial resources to continue construction, there was a fear of capital investments from the population, which, of course, was reflected in the sales figure. However, because most of our residents are foreigners, they, on the contrary, began to look for such small and tourist-attractive countries where investment prospects are high, and therefore invest money in real estate here. Therefore, I think that this trend will continue next year, which is very good for the country’s economy.
Batumi has the largest share of the development market after Tbilisi. Do you see prospects in other cities and are you planning projects outside the capital?
Yes, we are planning and discussing interesting projects on the Black Sea coast, but there, specifically in Batumi, the construction market is very saturated, and we think that if we take a project, it will differ from existing complexes
Finally, what is the strategy for the further development of your company?
Our company is only two years old, and we already have big plans and healthy ambitions. By 2022, our team plans to increase the volume of construction by 300%. We carry out construction in compliance with the highest standards, which means that our construction facilities are constructive and earthquake-resistant. Each current or future project of the company is designed for the convenience of the user with an exquisite appearance, an effective internal layout, and an outstanding location. Our value is such that we create only high-quality products and set this standard in the Georgian market.
In the future, of course, we intend not to stray from the chosen path and pace, decorate our city with Georgian architectural buildings, and make a certain contribution to the urban development of Tbilisi. We want to give new life to old Tbilisi and create a service focused on the wishes and needs of the user. We have healthy ambitions that in a few years we will significantly increase the scale and create positive trends not only in the Georgian market but also in the foreign market.
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