Many people already know that a new, modern skiing village is being built in Gudauri, 120 km away from Tbilisi, at an altitude of 2196 m above sea level. Development firm Red-Co became interested in developing Gudauri back in 2012. Having purchased a 50 ha plot of land in the resort, the company devised a plan for regulating the development process, and has followed it step by step ever since then. Red-Co builds hotel-type residential complexes and sells apartments to private individuals together with various services. The majority of the apartments in Red-Co’s past and current projects were sold during the construction phase, pointing towards the immense popularity of this type of real estate. Around 90% of the projects completed by Red-Co in 2012-2017, as well the ongoing projects, are already under private ownership.
Red-Co has just announced plans for a further 7 aparthotels. How many apartments will they include, and which price segment is the company aiming at? Property Georgia put these and other questions to Red-Co’s Marketing Manager Maia Bichikashvili.
- We announced in spring that Red-Co would build another 7 aparthotels with a total of up to 1000 apartments in 2018-2019. Red-Co’s development plan for New Gudauri was designed by the Canadian firm Ecosign, and includes a total of 26 aparthotel-type residential and leisure complexes, as well as several hotels. Furthermore, the plan includes the construction of separate chalets designed by Red-Co. We already have a project for building 20 chalets in New Gudauri. Between 2012 and 2017, Red-Co has completed 5 aparthotels, where a total of 400 apartments (21,000 m2) has already been sold. A further 4 complexes are currently being built. They will consist of up to 940 apartments (33,000 m2) in total, and are due to be completed between this year and the beginning of next year. Our company is currently selling properties at the Twins and Alpic aparthotels at very competitive prices. They are now between 30% and 50% cheaper than they will be at the end of the construction process.
- Why are the prices so competitive?
- This is an area where prices are growing on a daily basis. The number of tourists in Gudauri is going up, and it is becoming an economically active zone not only during the winter season, but also during summer. Georgia will be hosting the 2023 Freestyle Ski and Snowboard World Championships, where Gudauri will be one of the main locations. This will help increase awareness about Gudauri on the international real estate market. By that time, Red-Co’s development projects in New Gudauri will be largely finished, and real estate owners in Gudauri will see their investment double or treble.
- How big are the apartments that are in demand in Gudauri, and what are your target segments?
- We are building tourist infrastructure and hotel-type complexes that are mainly used by tourists. Due to the fact that buyers usually proceed to rent out their property, studio apartments with an average area of 30 m2 are particularly popular. That is precisely what the Red-Co aparthotel projects focus on. These will be studio apartments, with prices starting from $800 per m2. Red-Co apartments are being purchased by locals and foreigners alike. Statistically speaking, Georgians account for 60% of the sales, while foreign nationals account for 40%. When we started in 2012, all of our buyers were people who were interested in skiing. Now we are seeing a trend of people purchasing apartments as an investment, wishing to make a profit from real estate. The same can be said about foreign nationals. They are observing the growth in tourism, they see how quickly New Gudauri is developing, and they know that there are limits to development in these types of resorts. Once the development process is completed, it will become substantially more difficult and expensive to gain a foothold here.
- The Georgian real estate market has a shortage of development companies that take care of the environment and common areas after completing the construction. How does Red-Co deal with this challenge?
- Red-Co is building a new skiing resort called New Gudauri. As with any other settlement, it will not only require maintenance of the buildings, but also management and development of the whole territory. We are a company that cares about the development of the area and various business activities that satisfy tourist demand.
- What benefits does Red-Co offer to customers who wish to rent out their apartments for profit?
- Red-Co Management Group is involved in the hotel business, meaning that it manages the real estate built by Red-Co. Apartment owners can entrust their properties to Red-Co, and we will rent them out for a commission. Alternatively, owners can either manage the apartments themselves, or entrust them to a third party. Red-Co’s advantage lies in the fact that we are improving our terms on a constant basis. We wish to become the undisputed leader among the operators in New Gudauri. To this end, we aim to improve our general service and room service, the rooms themselves and the concierge service, as well as offer better terms to those who wish to obtain income from their apartments.