About investments in Croatia – project manager of the project Golf Park on Srđ – ‘This investment is entering new development phase ‘

Investments: If we reach an agreement with the City, the construction will start this fall. Legislation should provide fast achieving of an agreement between the investor and the local community that would allow the investor to build the infrastructure that is predefined by spatial plans in the name and for the account of the local community, and that those expenses are recognized as a paid municipal contribution. People are afraid of the unknown, but that is standard procedure everywhere in the world, we are not inventing anything new – says Leo Penović, project manager of Golf Park on Srđ , project that was waiting 10 years for the first building permit.

Golf Park project is entering new development phase. First one lasted for 10 years, and now you have to fight with the administration and the legislation that is interpreted in different ways because there is no standard procedure... What is your experience, how did you skip obstacles with the administration on other places and why the standard procedure is not yet established on national level and why do we have new problems with every new investment?

Every investment is the world for itself because it creates new long-term values for the community. What I think is wrong is the antagonism between the investors and local administration during preparation phase. Those two sides must work on the investment from the begging, respectively on creating new values. From my experience, local administration in Croatia is mainly inexperienced in preparing projects because they did not have the opportunity to work on large scale projects. The role of the investor must be expanded on the role of the assistant of the local administration in order to solve the problems and to realize the investment.  That is normal, because both sides work in their own interest – it’s a win-win situation, there are no right or wrong sides. It is important to define the problem that is creating holdback and solve it. Communication between the investor and the administration must be constant and transparent in order to keep up with the preparation and the realization. Otherwise, process will stand still and that will generate costs for both sides. In large scale projects, it is good to have the appointed coordinator of the project within the local administration. In that way, the investor communicates with the person who is familiarized with all phases and aspects of the project and who also knows all jurisdictions and the structure of the administration and that can mediate effectively in solving problems that are regular in large scale projects. He will do so in the best interest of the local community. The appointment of the coordinator has double positive effect for the local community. First, there is a bigger chance that the project will be prepared and realized according to the plan, and second benefit for the local community is that they will have a person with the experience of preparing large scale project and that knowledge can be applied in wide range of affairs of the local community.

Major difference between Croatia and other transition countries regarding this issue? In what transition country should Croatia look up on?

There are big differences between transition countries regarding legislation and administrative capacity. I can single out Czech Republic as a positive example, where the building permits are obtained based on the documentation that is necessary in Croatia for obtaining location permit. That is an excellent recommendation and a motive for the investors because the project can be changed during preparation phase according to the changes of the market and the public interest is protected according to the conceptual design of the project. After that phase the rule of the state is only to control. In Croatia, the legislative is solid, but we always must look a few steps in the future in order to be competitive in the future.  So far I only mentioned the capacity of the state and local administration because they are defining the speed of the realization, but beside that it is important that the market of consultants and designers to grow in number and in quality. The role of the consultants, designer and project managers is often neglected, but their quality defines the dynamic of the realization of the project from the investor’s side. Quality consultants are equally important as quality administration. The best administration in the world cannot issue permits for the badly prepared project.

The City, according to the law, is obligated to invest in utility infrastructure. That can be negotiated and realized according to different models, however, the City is afraid that they will build the infrastructure, and that the investor  will give up on the investment from whatever reason (earthquake, terrorism, bankruptcy...). How do you plan to remove those fears of the local community?

As for the investment in the infrastructure by the City, it is directly associated with the project and it is in large part secured by the amount of contribution that will be payed by the investor – so, no contribution, no investment by the city. Investments like this bring benefits to all parties and interest of the local community is interwoven with the interests of investors, and they are equally interested in the project which will be done eventually. The legislation, however, and the practice should enable fast coming to an agreement between the investor and the local community, that would allow the investor that on the name and on behalf of the local community carry out infrastructure defined by spatial planning documentation, and that cost should be given back as the cost of paid utility charge. We always come back to the experience of the realization of the projects. People are afraid of the unknown, but that is common procedure everywhere in the world, nothing new is here. Once in Croatia projects go to realization, automatically, has to be clear to the people that their interests and the interest of investors are connected, we would not have this talk. This will become very common, boring procedure with clearly defined rights and obligations, which would be the goal for each community. But when you are the first with such a complex project and at this stage, sometimes, it is expected a lot from investors - we can affect legislation, hardly. Luckily, I hear that several tourist projects in Croatia are at the front of the similar challenges and we believe that we will succeed to find a model in compliance with current regulations. Believe me, if these few projects are successfully launched, new investments will come just like that. The hardest part is to those who are the first - it took us almost 10 years to the first Permit.

What will get the City of Dubrovnik by completion of the project on Srđ? What is an amount of the money for the budget of the City? What is expressed in the public content which they will get? How many jobs? Does the project effect on the Dubrovnik as a tourist destination, as it is looking like Venice – a respectable, eye-catching postcard that is read in three days?

Srđ will become a popular destination for locals and tourists and we believe that the restored fortress Imperial and a new exhibition at the Museum of the Homeland War will become an attraction that will attract just a bit less number of visitors then the Walls of Dubrovnik. We are counting with more than a thousand new jobs and more than 36 million kuna of income to the city budget annually. Already, up to half of million people visit Srđ each year - imagine what the number of visitirs will be when everything is finished!


Source: Poduzetnik plus – Slobodna Dalmacija , 31.05.2016., by Jadran Kapor