Montenegrin hospitality firm Vile Oliva has finalized the acquisition of Hotel Plaža in Herceg Novi for €20.4 million, setting the stage for a significant €20 million renovation of this key tourism asset.
The company, under the ownership of businessman Žarko Rakčević, completed the transaction by transferring approximately €17.33 million, following an initial deposit of around €3 million.
This acquisition, coupled with the planned refurbishment, suggests a total financial commitment exceeding €40 million, although the renovation remains a proposed investment at this stage.
Vile Oliva aims to elevate Hotel Plaža to four-star status.
The deal is also noteworthy for the creditors of the hotel’s previous owner, Vektra Boka. An estimated €12 million from the sale proceeds is anticipated to address creditor claims, which include roughly €4.5 million owed to Crnogorska komercijalna banka.
Additionally, local authorities in Herceg Novi are pursuing resolutions for outstanding obligations associated with Vektra Boka.
This acquisition positions Vile Oliva as a key player in one of Montenegro’s prominent coastal tourism areas, particularly as international tourist arrivals and investment in upscale accommodations are on the rise.
Herceg Novi has historically seen less large-scale hotel development compared to Tivat and parts of Budva, making this redevelopment pivotal for enhancing the municipality’s hospitality offerings.
The planned refurbishment is expected to stimulate construction activity, equipment purchases, and job creation within the hotel sector, thereby bolstering Herceg Novi’s appeal in higher-value tourism.
The completed payment also transforms a significant property asset into liquidity for creditors, aiding in addressing some of the legacy debts linked to Vektra Boka.
The successful execution of the full €20 million refurbishment will be a critical next step for Vile Oliva, potentially marking Hotel Plaža as one of the largest individual tourism reinvestment initiatives currently underway in Herceg Novi.
