Real Estate
As HNW Individuals Seek Options, An Adriatic Resort Prepares
Luxury resorts based in low-tax jurisdictions have been around for decades; given the winds of change in certain countries when it comes to tax – such as the UK – places seeking to attract HNW individuals have incentives to keep showing off their advantages. We talk to the managers of a new development in the small Balkan country of Montenegro.
This publication occasionally writes about the world of luxury, and what the trends in the sector say about the state of the wealth management landscape. (See an example here about private aviation at Airbus, for example.)
Few luxury areas are more important than property. High net worth and ultra-HNW individuals and families want to have places where they can relax, have fun and stay private. Feeding into this, governments in certain jurisdictions are trying to attract wealthy people through citizenship/residency-by-investment schemes. These programmes wax and wane, and can be shut or paused if they are seen as having achieved a goal of attracting a certain amount of capital. Sometimes they are closed if real estate prices become a political flashpoint, as in Canada for example, or as a result of sanctions on designated Russians, as in the UK in March 2022. On the other side, countries such as Italy and Spain maintain programmes to attract capital.
Whatever the motives, a raft of jurisdictions continue to market themselves to wealthy individuals. When one considers that some countries, such as the UK, are closing off certain tax advantages, it is not hard to see the motivation.
Montenegro is putting itself on the list. The country ended its Citizens Investment Programme in 2022 but property owners can still apply for a residence permit, potentially leading to permanent residency after five years.
This small country on the western side of the Balkans – part
of Yugoslavia – emerged from Communist rule in the 1980s to be an
independent place favoured by wealthy foreigners. (It did not
hurt that it featured in scenes in the James Bond film,
Casino Royale, starring Daniel Craig. You can always
count on 007 to give a place a bit of stardust.)
A few weeks ago, the managers of what is called Porto Montenegro
unveiled its third, newest and most
avant-garde district, Synchro Yards. Slated for
completion in 2026, this is set to be the centrepiece of a
futuristic marina, complete with a beach club, a luxury hotel,
performance and events spaces, restaurants, high-end shops, and
year-round events. (The main picture shows the Regent Hotel
– source: Porto Montenegro.)
The new phase of real estate development introduces two distinct
residences designed by architectural firm Woods Bagot: AERIS and
IVO with interiors by Bergman Design Haus.
This news service sat down with Hugues Jannet, sales and
marketing director for Porto Montenegro, to discuss the
project.
WB: Porto Montenegro business was founded
in 2006. What is the new offering, and when does it become
live?
Jannet: Porto Montenegro, founded in 2006,
introduces Synchro Yards, its latest development set to be
completed in 2026. This new neighbourhood features two luxury
residences, AERIS and IVO, designed by Woods Bagot. AERIS offers
22 exclusive homes starting from €1.89 million, while IVO,
managed by Rare Finds hotel, provides 25 residences starting from
€1.0 million. Synchro Yards will also include a beach club,
performance spaces, restaurants, and shops, enhancing Porto
Montenegro's vibrant community.
WB: Who owns and is the main investor of
Porto Montenegro?
Jannet: Porto Montenegro is owned by the
Investment Corporation of Dubai (ICD), the principal investment
arm of the Government of Dubai. They acquired Porto Montenegro
Marina and Resort from Montport Capital in 2016 as part of their
strategy to add exceptional international assets in fast-growing
markets to their impressive portfolio.
David Margason serves as the managing director, while Valentina
McReynolds is the group chief finance officer. Michael Hardman is
the development director and Tony Browne is the marina
director. Desko Portic is operations director and Savo
Djurovic is the legal director. Predrag Lekovic manages asset
management and government affairs, and Angelo Zuccala is the
general manager of Regent Porto Montenegro.
During the summer season, Porto Montenegro directly or indirectly
employs more than 1,000 people. This highlights its significant
role as an employer in the region. The team is primarily based in
Porto Montenegro, located in Tivat, Montenegro.
WB: How many developments are involved in
the Porto Montenegro business and where are they
located?
Jannet: Porto Montenegro includes five distinctive
developments:
1. South Village: This area provides classic and elegant
waterfront living, fully developed and operational.
2. Boka Place: A collection of urban-inspired spaces focused
on health and wellness, currently under construction.
3. Synchro Yards: In the Avante neighbourhood centred on
creativity and self-enrichment, currently in development due to
open in 2026.
4. North Village: A laid-back lifestyle hub where active
days blend into fun, relaxing nights – also in
development.
5. Park Gardens: A resort-style oasis featuring lush
gardens, swimmable pathways, and natural homes, currently in the
master planning stage.
WB: Please explain how the development
will roll out.
Jannet: Our attention currently is on Synchro
Yards, the avant-garde upcoming neighbourhood, which is
due for completion in 2026. This phase of development
includes two remarkable buildings: AERIS and IVO Residences, both
architectural marvels by Woods Bagot and Bergman Interiors,
strategically positioned to offer views of the marina. Synchro
Yards (see below) will also feature a beach club with pools and
lagoons, upscale dining options, and exclusive retail outlets.
Moreover, the renovated shipyard building within Synchro Yards
will serve as a versatile event space, hosting a variety of
activities from arts workshops to musical events, honouring its
industrial heritage.
Source: Porto Montenegro
Porto Montenegro is poised for expansive growth, with plans to
develop into five distinct neighbourhoods, as outlined. Besides
the upcoming Boka Place and Synchro Yards neighbourhoods, future
developments, including North Village and Park Gardens, will
increase our destination’s offering. North Village will transform
the existing sports and tennis centre of the former naval
dockyard and is planned as a tennis-centric village for sporting
breaks. It will host small tournaments, delivering an active but
informal and laid-back lifestyle hub with residences, retail, and
eateries. Meanwhile, Park Gardens is planned as a resort-style
oasis and a haven of tranquility with homes set amongst a dense
jungle landscape and a winding network of swimmable
waterways.
Our vision is to ensure that Porto Montenegro is the premier
boating and super yachting hub in the Mediterranean and to
reinvent waterfront living.
Marina
Source: Porto Montenegro
WB: Some 60 per cent of PM’s clients so far are
from Turkey, the Balkans, etc. What new markets does PM want to
tap into?
Jannet: Porto Montenegro is already established
in the UK, Germany, France, China, and the US, but will soon
focus on the UAE market as well.
The US is a key target market for Porto Montenegro due to a
growing interest among Americans in luxurious waterfront living
and investment opportunities. A large population with significant
purchasing power and a strong desire among UHNW individuals to
invest and spend time in Europe makes the US an attractive
market. Additionally, the strength of the dollar is driving
sustained interest in investing abroad, and UHNW individuals aim
to be ahead of the trend curve by seeking Mediterranean
locations.
Germany is also one of the top countries for outbound tourism,
presenting opportunities to attract more visitors. Furthermore,
Germany is a top country for overseas property investment by high
net worth individuals, and there are cultural ties with
Montenegro, as German is still widely spoken in the country. The
significant Montenegrin expat community in Germany also supports
this market's potential.
France represents a wealthy market segment. The country's strong
yachting industry and renowned film industry, including events
like the Cannes Film Festival, provide additional avenues to
attract potential customers interested in yacht ownership and
film tourism. Additionally, the significant Montenegrin expat
community in France further enhances the market's potential.
With increasing wealth and outbound tourism China presents an
attractive market for Porto Montenegro. Additionally, China's
wealthy individuals seek to escape regulatory scrutiny by
relocating. The memorandum of understanding between Montenegro
and China to build a new highway connecting Budva and Tivat has
increased its accessibility and attractiveness for Chinese
investors.
Recognising the affluent population and interest in luxury living
in the UAE, Porto Montenegro plans to penetrate the UAE market
further. The company sees substantial potential in attracting
clients from this region and will make concerted efforts to
appeal to the preferences and needs of UAE residents. With a
nucleus of superyachts and luxury lifestyle living established in
the UAE, there is a seasonal need to de-camp to the Mediterranean
during the extreme summer weather. Porto Montenegro provides the
perfect location and luxury lifestyle facilities for wealthy
Arabs and non-Arabs who spend the entire summer (up to eight to
nine weeks) in Europe.
WB: Are clients typically high net
worth/UHNW individuals and families? What is the main reason why
they want to be part of the PM offerings?
Jannet: The main reasons clients choose to be
part of Porto Montenegro's offerings include the investment
freedom that Montenegro provides. Montenegro has no investment
restrictions on foreign ownership, creating an attractive
environment for international investors. Additionally, Porto
Montenegro offers significant tax benefits, with minimal property
taxes, stamp duties, and tax secrecy, presenting an appealing tax
environment for investors.
Residency perks also play a crucial role in attracting clients.
Montenegro's residency permits allow foreign nationals to obtain
temporary residency through property ownership, which can lead to
permanent residency after five years. This flexibility is
particularly attractive to individuals seeking to establish a
foothold in Europe.
Furthermore, real estate growth in Montenegro, especially in
coastal areas like Porto Montenegro, has been significant. The
region has experienced substantial real estate appreciation, with
rental yields averaging up to 5 per cent, making it an appealing
investment destination.
Regarding the connection to Montenegro's "golden visa" programme,
although Montenegro ended its Citizens Investment Programme (CIP)
in 2022, property owners still have the option to apply for a
residence permit, potentially leading to permanent residency
after five years. Foreign individuals purchasing property or
establishing companies in Montenegro can obtain temporary
residence permits, allowing them and their immediate families to
stay in Montenegro for 365 days per year. This programme serves
as an incentive for investors seeking residency in a desirable
European location.
EU nationals can stay in Montenegro for 90 days within a 180-day
period without a visa or permit. Those seeking to establish
long-term residency in Montenegro have the option to extend their
stay or obtain residency permits beyond this period.
WB: How green and sustainable is
this development?
Jannet: Porto Montenegro is committed to environmental
stewardship and sustainability, as evidenced by its Corporate
Social Responsibility (CSR) initiatives and eco-friendly
development practices. The sustainable design of Synchro Yards
aligns with Porto Montenegro’s dedication to pioneering
innovative solutions to environmental challenges. Aiming for LEED
and WELL certifications, the facilities at Synchro Yards will
incorporate environmentally friendly features and materials,
achieving high levels of energy efficiency and reducing the
project's carbon footprint. Porto Montenegro remains committed to
becoming the most sustainable yachting development in the
world.
In terms of community investment, Porto Montenegro has invested
over €3.5 million ($3.7 million) in donations and sponsorships to
various sports, educational, and cultural institutions. This
"uplifting the community" initiative demonstrates a dedication to
social responsibility and community wellbeing.
Regarding historic preservation, Porto Montenegro has undergone a
remarkable transformation while preserving elements of its rich
heritage as a former historic naval base. The redevelopment
efforts prioritise retaining old structures, ensuring sustainable
integration with the site's historical significance.
Porto Montenegro incorporates various eco-friendly features to
promote sustainability across all its developments. The use of
double-glazed windows and moisture-resistant painted walls
enhance energy efficiency and durability, reducing
environmental impact. Residences equipped with smart home and
immersion technology optimise energy consumption and enhance
overall efficiency. Dimmable LED lighting reduces energy
consumption while providing optimal illumination. The inclusion
of air purifiers ensures a clean and healthy indoor atmosphere,
promoting occupant wellbeing. In Boka Bay, Porto Montenegro
implements sustainable agricultural practices by harvesting
fresh, hyper-local produce daily from rooftop kitchen gardens.
This initiative reduces food miles, promotes biodiversity, and
supports local agriculture, contributing to a more sustainable
and resilient food system.
WB: What does success look like, commercially,
for PM?
Jannet: As of 2024, Porto Montenegro has
consistently demonstrated success in its residential developments
since its inception in 2009. The South Village and Boka Place
neighbourhoods’ residences being sold out upon
completion emphasise the high demand and success of Porto
Montenegro's residential offerings.
WB: How much of your business do you get via
recommendation, word of mouth, banks, family offices, lawyers,
accountants, and other channels?
Jannet: Our business comes from a wide range of
investors, including family offices, HNW individuals and
asset managers seeking attractive real estate investments with a
Mediterranean lifestyle appeal.