Although due to persistent media propaganda, the public is convinced that Belgrade Waterfront is the ‘real estate project of the century’, its two dependent companies in 2020 recorded a deficit of almost 18 million euros.
Also, by the end of 2021, they will have to repay 25 million euros, which were lent to them by their majority owner based in Abu Dhabi, writes NIN weekly.
A few weeks ago, the news that “Mrs Nada had become the proud owner of flat No 3000 in the Belgrade Waterfront development” was plastered all over social media. This information was meant to let people know that all is well with the “project of the century”.
Unfortunately, it doesn’t look that way, because the state, as a minority owner (32%), will not receive a single penny from the project this year – not because the official majority owner, Belgrade Waterfront Capital Investment L.L.C., based in Abu Dhabi (68% share), is not willing to share in the profits, but because there was no profit made last year. And even if there was, there is little chance that the state would get a slice.
In 2018 and 2019, Belgrade Waterfront generated a surplus of 2.45 and 1.84 billion dinars respectively, but the state was left high and dry even then because no decision was made on the distribution of profits. In 2020, the company recorded a net loss of 327 million dinars and no decision was even made to cover the debt, as it had been done with the losses from 2016 and 2017, totalling 2.4 billion dinars.
Although accompanied by an incredible media campaign, the company ended up in the red in 2020, as did its two subsidiaries – BV Galerija and BV Kula – formed in 2017. BV Galerija posted a net loss of 1,357.4 million and BV Kula 409.4 million dinars. Thus, the expenses of all three companies were 17.8 million euros higher than their operating income.
Truth be told, with projects of this kind, it is not uncommon for expenditure to exceed income for a number of years after the project launch, because the money collected in advance is only recorded as income when the apartments are fully finished and occupied. However, few expected that in the six years since the joint enterprise was set up, not a single dinar would be paid into the state treasury on a dividend basis, although officials claim that when (if) it is completed, Belgrade Waterfront will be worth more than €3 billion. The costs that the state had are already measured in hundreds of millions of euros.
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