Future Capital Partners and Boygues Batiment International partner on real estate development in Montenegro
Future Capital Partners (FCP), the GBP6bn alternative investment boutique, has partnered with Bouygues Batiment International (BBI), a construction and property development company, to develop a EUR180m luxury real estate development in Montenegro.
BBI, the international building division of Bouygues Construction, has signed a memorandum of agreement for the construction of the project with Integrated Property Contractor Services (Montenegro) Limited, a wholly owned subsidiary of FCP.
Located in Budva Bay, Montenegro, the resort will consist of a luxury hotel, residential apartment complex and conference centre.
Signature of this agreement will also help FCP in the procurement of senior financing. The project is now in the final stages of capital raising and is seeking senior financing from institutions and equity through a joint venture partnership and the direct investment vehicles offered by FCP.
Following the recent acquisition by a wholly owned subsidiary of FCP of the land in Budva Bay, where the development will be built, the agreement with BBI for the construction of the resort puts the project in a strong position to attract investment from major institutions, joint venture partners and individual investors.
Tim Mycock, head of real estate at FCP, says: “There is now real momentum behind this project, and the backing of one of the world’s largest construction firms is a huge stamp of approval for the project. BBI is globally recognised for its expertise at every stage of a project: design, construction, fundraising and maintenance. They are the ideal partners to help us deliver this development on budget and on time.”
As part of the project fundraising, FCP offers three routes of investment which provide a variety of opportunities for high net worth individual investors as well as corporate investors. Returns will be derived from the sale of the luxury residential units and from the operation of the five-star hotel, which will be run by a world renowned 5 star hotel group. The project is targeting strong returns over a six to eight year time frame.
The development, which will include 100 metres of prime beachfront, will be the first 5 star resort in Budva, one of Montenegro’s tourism hotspots. According to The World Travel and Tourism Council, Montenegro, on the Adriatic Coast, is the fastest growing tourism destination in the world, and will continue to be for the next ten years.
The Montenegrin property market is well poised to reward investors with substantial capital growth, accompanied by a boost of inward foreign investment from across the EU and Russia. The World Travel and Tourism Council expects there to be a rise in capital investment of 6.4 per cent in 2012, and a rise of 13.2 per cent p.a. until 2022.
Christophe Petit, development director at Bouygues Batiment International, says: “Montenegro’s potential and FCP’s experience and skill in financing and managing projects like this, made this a highly attractive opportunity for BBI. With Montenegro fast becoming one of the world’s number one tourism destinations, we believe this project has the opportunity to deliver an outstanding tourist resort that we will be proud to build.”