Croatia plans to offer the bay of Kupari near Dubrovnik, its most-visited Adriatic Sea resort, for development, with a value of as much as 250 million euros ($318 million).
Kupari, 6 kilometers (3.7 miles) east of Dubrovnik’s Renaissance-era city walls, will be offered “in the next few weeks” for development of hotels, villas and a conference center, partly through concession and partly through property sales, the Tourism Ministry said by e-mail in response to Bloomberg questions.
Croatia, which is set to become the 28th member of the European Union in July, needs foreign investment to revive its economy after three years of recession and stagnation. The Adriatic Sea nation gets one-fifth of its gross domestic product from tourism, developed along its 5,880 kilometers of coastline.
Kupari, a 300,000-square-meter bay with a crescent-shaped pebble beach, used to be a Yugoslav-era military resort before it was heavily damaged in the 1991 war for Croatian independence. Abandoned since then, shell-scarred ruins of the four concrete-and-steel hotels from the socialist era today are overgrown with Mediterranean vegetation.
“The location of the project is extraordinary,” Vedrana Likan, managing director of the Croatian branch of Colliers International, said in an e-mailed response to Bloomberg questions. “A concession model could be the right form of investment, as long as the concession period is long enough and incentives for private partners are provided.”