News
Hotel Industry Development component "Host in Georgia"
03 Apr 2018

The new Hotel Industry Development component of the State program ‘Produce in Georgia’ already gains a huge success. The Entreprise Georgia already supported 42 business entities, with a total investment volume of GEL 123,7 mln and based on these 42 new Hotels  total more than 1300 people will be employed and an additional 1200 new rooms will be added in the Georgian Hotel Industry.

The New Hotels will be build in Bakuriani, Gudauri, Poti, Ureki, Nikortsminda, Kazbegi, Sagarejo, Ginio, Shekvetili, Telavi, Tskaltubo and Kutaisi. 

Entrepreneurs operating in the regions of Georgia can benefit from the new component of the State Program “Produce in Georgia” – Hotel Industry Incentive. According to the Governmental decision and based on the market demand the scheme was introduced to promote hospitality business across the country, to attract number of tourists, to create jobs and to help the development of each region.

The scheme promotes entrance of international hotel brands via franchise or management contracts by co-financing royalty fees.

It is notable that according to the state program’s component – Hotel Industry Incentive, the Entrepreneur who is interested in the financial support, has the opportunity in any region of Georgia, excluding Tbilisi and Batumi cities:

  • To Build a New Hotel
  • To conduct the Expansion/Re-equipment of the existing infrastructure
  • Also to sign a franchise contract with the international hotel operator and bring the foreign brand in the Georgian market

From the Entrepreneurship Development Agency under The Ministry of Economy and Sustainable Development, the co-financed will be implemented in a following way:

  1. Building a hotel, as well as infrastructure upgrades/re-equipment of the hotel
  • The co-financing of commercial loan’s annual interest rate by 10% ( in foreign currency by 8%) for the first two years

The Minimum Volume of the Loan – 200,000 GEL;

The Maximum Volume of the Loan – 2, 000,000 GEL;

Collateral participation in the first 4 years, the loan volume by 50%;

  • Co-Financing in the Consulting services
  1. The Co-financing of Franchise Agreement
  • Franchise / management contract with so-called “Royalty Fees” co-financing for the first 2 years (no more than 300,000 GEL)
  • Co-Financing in the Consulting services
  1. The hotel development by the "franchise" agreement
  • Franchise / management contract with so-called “Royalty Fees” co-financing for the first 2 years (no more than 300,000 GEL)
  • The co-financing of commercial loan’s annual interest rate by 10% for the first two years

The Minimum Volume of the Loan – 200,000 GEL;

The Maximum Volume of the Loan – 5, 000,000 GEL;

  • Collateral participation in the first 4 years, the loan volume by 50% (No more than 250,000 GEL)
  • Co-Financing in the Consulting services

It should be noted that an entrepreneur can take advantage from both co-financing of the loan interest, as well as from current tax co-financing while bringing the brand by "franchise/management contract.

For more information check the link: http://enterprisegeorgia.gov.ge/ge/whatwedo/Hotel-industry-incentive?v=91