Souteastern Europe business centre
For decades, a large area of Belgrade’s city centre between the main railway station and river Sava has been completely forsaken and home to abandoned cars, rusty wagons and half-demolished warehouses. But this unattractive site may soon change, turning an area of Belgrade into a Dubai of the Balkans.
The project is called `Belgrade on the Water’ and the Serbian government found a partner in the UAE which, at least on paper, has excellent references. Eagle Hills, is a newly founded construction company from the UAE, headed by Dubai-based developers Emaar Properties chairman Mohamed Alabbar , who erected Dubai’s Burj Khalifa, the tallest building in the world. This colossal project will turn the right bank of the Sava into a prestigious area with futuristic architectural solutions compatible with those in Dubai, Doha or London and would be implemented over five to six stages. According to authorities, the whole project could be completed within five to seven years.
The `Belgrade on the Water’ complex (residential and business) will cover an area of 1.85 million sq. metres. The project includes the construction of residential buildings, offices, the largest shopping mall in the Balkans, schools, theatres, opera house, clinics, parks and gardens, luxury hotels, and a marina for yachts as well as the 180-metre-high `Belgrade Tower’ which is expected to be completed by 2017. Alabbar stressed that the initial investment would be around EUR 2.5 to 2,8 bn.
The ‘Belgrade on the Water’ project saw its world premiere on 11 March during the Cannes Real Estate fair, the biggest real estate event in the world, while the master plan was presented in Dubai a week earlier.
High expectations and possible benefits
According to the project’s main promoter, Vučić, the country’s aim is for “Belgrade to become a regional centre, while Serbia should attract the biggest number of tourists and investors in the region”.
Furthermore, Vučić went so far as to say that project would enable the recovery of the Serbian economy and the country’s exit from its ongoing financial crisis, immediately creating 20.000 jobs.
The UAE on the other hand, sees an opportunity to expand into the Balkan region using Serbia as a base, as in the case of the strategic partnership between Etihad and Air Serbia, and it tends to favour countries where they know the leadership well, referring to the close personal friendship between Vučić, and Abu Dhabi Crown Prince HH Sheikh Mohammed bin Zayed Al Nahyan.
“The project is without a doubt one of the most important for Eagle Hills, and the company’s officials will work with local authorities in the coming months to ensure the project is completed as soon as possible,” Alabbar noted. He also emphasised the “unbelievable support” provided by the Serbian government and local authorities. The UAE businessman expects that the project in Belgrade would mark a major breakthrough n the European market.
According to both sides, it is a large project at an interesting location and would result in a modern city that would push Serbia’s economy forward, as it would provide a stimulus to all sectors, particularly construction, hospitality and tourism.
Unclear details and doubts
Despite having full support of the government and local authorities, there have been some loud criticisms over the apparent hurry to get the project off the ground. First of all, it is the nature of the partnership agreement signed by Eagles Hills and the Serbian government in which many details remain unclear. It is still not sure whether the complex would be in the form of foreign direct investment or a credit agreement, how profits would be shared and who is directly responsible for the project. There has been similar confusion in the past with previous arrangements between Serbia and the UAE. When asked to reveal some of the details for BQ Doha Magazine regarding project financing , the head of the `Belgrade on the Water’ project group, Srdjan Rupar, has chosen to remain silent. One of the possible explanations for this may lie in the fact that usual formal procedures could slow down dynamics of the project, which is certainly not in the interest of the Serbian state and the ruling party since `Belgrade on the Water’ was one of the main issues during the recent general election campaign.
Beside this, the project would create enormous logistical turbulence in the city as it initially requires relocation of the main railway and bus station, including all main tracks and sidings. According to city officials, 70 percent of this assignment should be completed by September this year. In addition, thanks to a loan from the Kuwait Fund for Arab Economic Development amounting to around EUR 25 mn, the new railway station should be finally completed after a wait of 40 years.
Many architects also expressed their concerns on whether Belgrade’s overall infrastructure is sufficient to support such a big complex and the rapid population growth which has seen the number of residents grow to two million. Yet another unanswered question is exactly who would be able to afford to rent or buy fancy apartments, knowing that Serbia as well as Europe as a whole is still undergoing a financial crisis.