Real Estate and Construction
The construction sector in Azerbaijan is one of the most interesting in which to invest for the next 30 years. In 2004, investment in construction reached USD 3.7 billion, a 7.4 percent increase on the previous year.
Significant investment opportunities available
The number of foreign companies working in the construction industry has risen by 20 percent in the last two years. This includes firms from Turkey, Russia, the United States, the United Kingdom, Iran, Germany, Italy, Finland, Ukraine and China.
About 75 percent of the construction industry in Azerbaijan is already in private hands. Many tenders are being won for huge infrastructure pro-jects, such as the rebuilding of roads, residential and administrative buildings. Around USD 283.88 million has been earmarked for these types of infrastructure projects.
Housing is a particular growth market. Following years of under-investment in Soviet times, Azeris are keen to improve or rebuild their housing stock. The volume of house-builds has increased by a multiple of 2.6, and in 2004 more than 1.3 million square meters of living space will be built.
Azerbaijan’s strategic location between Russia, Iran, Turkey and Central Asia, as well as its improving economy and significant oil reserves, have already helped to attract international investors. With them has come a need for improved houses and offices, resulting in a construction boom at the premium end of the market.
Continuing investment in the tourism industry is also having a positive effect on the construction industry. Many new hotels, resorts, entertainment centers and parks are being built, with more on the way.
In terms of real estate, currently foreign individuals and companies are not permitted to own land in Azerbaijan, although they can own immovable property on the land. Land may be leased for long-term periods, and profits from rental properties are taxed at 30 percent.
Prant Real Estate Agency
“We ensure your world-class effective investment.”
Yosef Alekperov, President
When Yosef Alekperov founded Prant Real Estate in 1997, he brought world-class real estate services to the Azerbaijan market for the first time. The real estate sector began to develop rapidly following the collapse of the Soviet Union and the expansion of the local oil sector, especially as global investors began to target Azerbaijan for its strategic location at the crossroads of Europe and Asia. Prant began by offering high-quality lease and purchase services and has since branched out to offer a range of international-standard property services for local and international clients.
Prant’s database currently contains more than 44,000 properties in Baku, its surroundings and throughout the country. These properties range from houses and apartments to commercial space, factories, building lots, industrial plants, offices and commercial buildings. Foreign investors are supported by a law established by Azerbaijan’s President Ilham Aliyev that allows private ownership of real estate and is designed to help stimulate foreign investment.
The local real estate sector continues to evolve rapidly, with major new pro-jects launched every day by local and foreign investors. The real estate sector is currently dominated by European investors who have been quicker than their United States counterparts at recogni-zing and profiting from the outstanding potential of the Azerbaijan property market.
Prant is well placed to assist United States investors aiming to enter the market. Over the past three years, Prant has significantly increased its spheres of activity and has further strengthened its network of contacts throughout the country. Prant is well known to offer the most complete network of any local real estate firm, and has positioned itself as the ideal partner for corporate clients as well as individual investors. Prant offers a full range of services, including legal consultation, sales and leasing and much more.
The company currently offers hundreds of high-potential projects, some with guarantees of almost unlimited income. For example, from an investment of USD 2-3 million in a 12-16 storey residential building in the center of Baku City, investors can expect to earn income of USD 6-9 million within seven to ten months. Prant also owns several hectares of prime construction sites in Baku City for the appropriate investor.
One of Prant’s most successful initiatives is the construction of guest houses and cottages. The income of one two-storey cottage in Baku or its surroundings totals some USD 40,000 to 50,000 per year, allowing investors to recoup their initial outlay within two years and earn up to four to five times the amount of the original investment by putting the property on the market.
Prant offers a large choice of such high-potential investments, and is eager to assist United States investors in taking advantage of this exceptional growth market.
