The FINANCIAL — Bank of Georgia will finance 15 construction companies with USD 28 billion, received from Overseas Private Investment Corporation (OPIC).
Bank of Georgia has already signed a contract with three construction companies: IBERIA, KALAS and BAGEBI City Group.
The total amount of the loan for the three named construction companies will be USD 12 billion. Bank of Georgia will also give out hypothec loans for customers wishing to buy houses in the mentioned projects. The interest rate will start from 13%.
“Bank of Georgia conducted a detailed research of current buildings and chose the prioritized ones. We should help construction companies finish their already-started projects. Bank of Georgia supports all these projects. The interest rates for construction companies are from 14-18%. For getting hypothec credits customers are obligated to cover 30% of the total amount necessary for a house. The term of a loan is 10 years,” Irakli Gilauri, General Director of Bank of Georgia, one of the leading Georgian banks, told The FINANCIAL.
“Our project is almost finished. There are left just cosmetic works and the repair of yards. I think that such an initiative should be imitated by other banks. The price of 1 square meter is USD 1,500 for finished houses. We reduced the prices by 20-30%. Bagebi City Group already started building a new project with over USD 8 billion. The project is planned to be finished in a year and a half and 50% is already sold. From 115 flats only 15 are left,” Jumber Khatiashvili, Chairman of the Board of Directors of Bagebi City Group, says.
Bagebi City Group is a rapidly growing, dynamic group company covering a wide range of industries in Georgia. It was founded in 2002, with the partnership between Mrs Nino Bendukidze and Dr Jumber Khatiashvili. The founding project was planning and managing the modernisation of Vake Swimming Pool, which has since become a modern-day landmark in Georgia.
“We plan to finish this project in a year. About 20% are left to be sold. Currently we are negotiating with the U.S. Government and in spring will receive 8 billion; this money will be enough to finish all our current projects, which are 4 in total. The price per 1 square meter is USD 1,200 for fully renovated. I can’t talk about our competitor companies but one thing I can say is that strong and healthy companies will survive,” Ramaz Mosashvili, Chairman of the Board of Directors of Iberia, notes.
Iberia Real Estate is a leading Georgian real estate development and construction company. The company primarily focuses on premium class residential real estate in upscale neighbourhoods of Tbilisi. Iberia was established in 1999 and completed its first residential development in October 2002. Iberia operates through two main divisions: Real Estate Development Division and Construction Division.
“This project is planned to be finished in two or three months and 50% is already sold. The amount purchased by Bank of Georgia will be enough to finish the started project. We are not planning to start some other project before finishing this one,” Gocha Dzneladze, Founder of construction company KALAS, says.
Written By Madona Gasanova
