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From land alienation to sinking buildings, shadows cast over strategic investments

2026-07-25 09:34:07Biznes SHKRUAR NGA REDAKSIA VOX

From land alienation to sinking buildings, shadows cast over strategic

The strategic investment portfolio in Albania has been presented over the years as an instrument to attract capital, develop tourism, and create new jobs.

But, in addition to projects that have remained on paper and promises of billions in investments, some of them have been involved in criminal investigations, ownership conflicts, environmental controversies or serious technical problems and non-implementation of contracts, in terms of investment, jobs and deadlines.

In some projects there are court decisions and confiscation of assets, while in others it is about still unfinished investigations, seizures of individual properties, complaints from owners or technical findings that require intervention.

The most serious case, where illegality has been confirmed by the judiciary, is related to the strategic tourist project "Dreamades Luxury Suites" in Dhërmi. Investigations revealed that a state-owned land area was registered and transferred to private ownership through forged documents, before being sold to a company associated with the development of the project.

The case ended with the conviction of the former mayor of Himara, Jorgo Goro, and the confiscation of about 10,000 square meters of land, which was returned to the state. The court declared the land alienation scheme illegal, but not the entire tourism project.

Technical problems have also been identified at “Durrës Yachts & Marina.” State inspections have found significant subsidence of the foundations in two of the complex's buildings.

In one of them, the subsidence was reported to be up to 28 centimeters, while in the other it was up to 18 centimeters. For multi-storey buildings that were nearing completion, the extent of the deformation required specialized intervention, reinforcement of the foundations and the drafting of a technical project for the stabilization of the structures.

The case raises questions not only about the manner in which the works were implemented, but also about the quality of geological studies, design and technical supervision in an investment worth over 2 billion.

The tourist resort project on Sazan Island also faces a particular technical, safety and environmental problem. Due to the long-standing military use of the island, there are suspected to be unexploded ordnance on the territory and in the surrounding maritime area.

Environmental and regulatory concerns have also been raised about the “Manastir Resort”, near the Butrint area. Part of the project’s territory is within the boundaries of the Butrint National Park, where construction was restricted by legislation on protected areas.

The authorities responsible for nature protection had requested that no construction be carried out on the relevant plots as long as they were part of the park. The situation changed after the review of the boundaries of the protected area, when the plots in question remained outside the park.

Legally, the border change paved the way for the project to develop. But the manner and timing of the change created controversy over whether the territory's defenses were weakened to serve a strategic investment.

An even more complicated combination of property, environmental, and security problems is at the “Pashaliman Laguna Eco Resort”.

The proposed development site for the resort is located near the ancient city of Orikum, the protected area of ​​Cape Shëngjergji, and the Pashaliman military base. This has raised concerns about overlapping with archaeological heritage, the boundaries of protected areas, and the use of properties of national importance.

The discussion also included the removal of several territories from the Armed Forces expansion plan, as well as public suspicions of conflict of interest in the administrative handling of the project.

There has been no final court ruling declaring the resort illegal, but the collection of issues related to military property, cultural heritage, and nature protection makes it one of the most controversial projects on the list of strategic investments.

Property conflicts have also accompanied the “Soleil & Sea” project. Part of the territory on which the investment was developed has become the subject of a long legal battle between people claiming ownership.

One of the claimants acquired the rights to the property in a civil proceeding and then filed a criminal complaint, raising allegations of forgery of documents and interference with property registration.

Status has often been granted on the basis of the promised amount of investment and the declared number of jobs, while verification of ownership, environmental impact, technical feasibility, and actual implementation has not worked.

Strategic status remained more of an administrative privilege than a guarantee that the project is legally, technically and economically viable and has an impact on the economy.

"Durrës Yachts & Marina", private benefit at the expense of the public bill

The "Durrës Yachts & Marina" project is the most special case of strategic investments, not only for the value of the investment and the name of the investor, but also because it is being developed in the current territory of the Port of Durres, one of the country's most strategic assets, as the government has failed for several years in a row to tender an investor for the construction of the New Port in Porto Romano.

In 2022, the Strategic Investment Committee granted strategic investor status to the “Durrës Yachts & Marina” project, which is being developed by the company “Durrës Marina” sh.a., an enterprise established as a Public-Private Partnership, where the Albanian state owns 33% of the shares. The main private investor behind this project is Mohamed Alabbar, a businessman from the United Arab Emirates, who operates through the company Eagle Hills Real Estate Development, in partnership with the Albanian state.

According to the business plan, the “Durrës Yachts & Marina” project is expected to generate around 3.2 billion euros in sales revenue and a net profit of around 854 million euros. The “Durrës Marina” company has been established as a Public-Private Partnership, where the private investor owns 67% of the shares and the Albanian state 33%.

In this report, the Albanian side could benefit from around 281 million euros, while the private investor is entitled to around 572 million euros.

The vast majority of revenue is expected to come from the sale of around 13,000 apartments. The project is primarily residential. Around 93% of the planned area is intended for housing and around 70% of revenue will come from the sale of apartments. Four and five star hotels, retail units and the marina play a smaller role in the financial model.

Although it is presented as an investment worth over 2 billion euros, "Eagle Hills" has undertaken to directly invest only 80 million euros from its capital.

A similar amount is expected to be secured through bank loans, while the main part of the financing, over 2 billion euros, will gradually come from the pre-sale of apartments and commercial units.

The balance sheets for 2023–2024 show that this model has started to work. The company had collected around 4.17 billion lek, or approximately 42 million euros, in the form of prepayments from buyers.

At the same time, the private investor's capital was around 7 million euros, while the costs for the first three buildings reached around 35 million euros.

The financial reports themselves consider customer prepayments as an important component of financing.

With an initial investment of 80 million euros and a target profit of around 572 million euros, the rate of return for the private investor is estimated at over 600%. This ratio is explained by the fact that the state makes the land and fiscal incentives available, while a large part of the construction is financed by the clients through advance payments.

The Albanian state did not contribute cash to the company, but rather public properties in the territory of the Port of Durres, rights over the area, administrative facilities, and fiscal exemptions.

The project is exempt from the infrastructure impact tax and the social housing contribution.

According to the report on the project's challenge submitted to the Constitutional Court, the value of assets, facilities and public contributions related to the project amounts to around 940.2 million euros.

This amount includes around 124 million euros in value of public land, 400 million euros in value of the plot, 84 million euros from the exemption from the infrastructure impact tax, 25 million euros for territory cleaning, 8.2 million euros in loan costs and 299 million euros in contribution to construction.

These are not immediate budget payments, but missing assets and income and economic commitments of the state.

But the biggest public cost is outside the marine company's balance sheet. The transformation of the existing port into a residential and tourist complex requires the relocation of commercial activity to Porto Romano.

The first phase has been tendered with a limit fund of 39.32 billion lek excluding VAT, approximately 400 million euros, while the total cost of the new port is expected to exceed 1.6 billion euros.

This investment will be financed from the state budget. The construction of Porto Romano is the condition that paves the way for the release of the current territory of the Port of Durres for the private project. The investor's benefit is related to the development of one of the most valuable areas of the country, while the bill for the replacement infrastructure remains public.

The construction and sale of the marina units have advanced, while the procedures for Porto Romano have been canceled more than once.

The re-announced competition with five bidders closed without a contract, as the sole operator remaining in the final phase did not submit a financial offer. The new port has not yet entered construction according to the initial calendar.

If port activity continues in Durrës, the release of space for future phases of the marina will be delayed and contractual claims may arise.

If the government accelerates the new project at a higher cost, the difference will again weigh on public finances.

The 33% quota gives the state the right to participate in future profits, but this benefit is not guaranteed.

The dividend depends on profit realization, sales pace, costs declared by the company, and decisions on its distribution, but in the meantime, land, fiscal incentives, and replacement infrastructure are immediate contributions of the state to the investment.

"Durrës Yachts & Marina" is taking the form of a primarily residential development, financed in large part by pre-sales.

Faced with an alleged profit of 281 million euros for the Albanian side, the value of the assets and public facilities identified in the project documents alone amounts to around 940 million euros, not including the full cost of Porto Romano.

The project is facing implementation difficulties. Two buildings sank about 15 centimeters last year, giving the project a negative image in the early stages of implementation.


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