Investor Perspective: Montenegro

It only took a few minutes of watching Casino Royale, the newest James Bond film, for me to fall in love with the idea of traveling to Montenegro. …

It only took a few minutes of watching Casino Royale, the newest James Bond film, for me to fall in love with the idea of traveling to Montenegro. If you’ve seen the movie, you likely know what I’m talking about. The hotel and casino where the plot begins to thicken is portrayed as being in Montenegro, and the scenery is beautiful. Unfortunately, the actual hotel used in the movie is in the Czech Republic, not Montenegro. Because I didn’t know that before I traveled to Montenegro, my expectations were high before I even set foot on Montenegro’s soil.

Because of our shared love of places we have yet to experience, my wife and I scheduled a trip to Croatia and Montenegro in May. We were not able to book a hotel in Montenegro from the States, even given a reasonable amount of devoted Internet time. Neither were we able to book a hotel through a travel agent via phone while in neighboring Croatia. We ended up renting a car and driving there without knowing where we would stay. That gave us a chance to enjoy the scenery, the most impressive part of the country. Had we been able to book a hotel, we would have ended up staying in Kotor, but instead we decided to foray all the way to Budva, which turned out to be the highlight of our few-day stay in Montenegro.

My sneaking suspicion about most U.S. tourists is that they would be reluctant to take this “fly by the seat of your pants” approach to traveling. Thus, I don’t see Montenegro becoming a hotspot for U.S. tourists anytime soon, which may be a good thing for Montenegro. While the southern portion of neighboring Croatia hosted a diverse group of European, Asian and American tourists, Montenegro mainly had tourists from Russia and other Balkan states, such as Croatia and Bosnia-Herzegovina.

My wife and I were struck with many of the contrasts within Montenegro: cities that looked run down from the main roads, but which carried beautiful old world charm in the historic parts of town, and extremely nice hotels that offered only two-star buffets. Our time there was enjoyable, even though the process of getting there was more difficult than we expected.

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The purpose of our trip was getting an on-the-ground feel for how an end user would value Montenegro. End users pay the most for property, whether they pay it in a nightly rental or in the purchase of a vacation home. Our trip left us with the following perspective on the two most intriguing areas of Montenegro we visited:

The Next Hot Spot: Sveti Stefan

The most impressive part of our trip was visiting the island monastery of Sveti Stefan (St. Stephen), which is actually connected to the mainland. It had been, for a number of years, a resort that in its heyday attracted the likes of Sophia Loren. What we found when we got there was a beautiful piece of history that we could no longer tour; apparently the island has been leased by a company from Singapore. My guess is that it will soon be remodeled into a five-star resort. There’s just too much potential in the surrounding area to ignore.

Only five kilometers from Budva’s “stari grad” (old town), Sveti Stefan seems a ripe spot for significant development and thus investment. Budva is a charming city that strikes me as a poor man’s Dubrovnik. It has nicer beaches than southern Croatia and a large beachside boardwalk that goes into the old town. Sveti Stefan benefits from being close to these tourist amenities, while remaining far enough away to have monastic tranquility.

Long-Term Play: Kotor

Kotor was disappointing to us for the most part. The downtown area is punctuated by a superbly located but entirely abandoned old hotel, complete with broken windows. Many of the buildings near the old part of town are littered with graffiti. The town clearly has some potential; the drive from Croatia around the fjord to Kotor is breathtaking. The Bay of Kotor has the feel of entering medieval Switzerland. It was unlike the oceanfront climates of both Dubrovnik and Budva.

While I can see the long-term potential of Kotor, it is clear that the city has a long way to go. As evidenced by our choice to stay in Budva over Kotor, I found the city less inviting as an end user. I can see how the exterior of the old part of town could be beautified. I just don’t believe it’s going to happen right away, and that makes Kotor a long-term play. For starters, someone needs to purchase and rehab the dilapidated hotel right next to old town. It could be magnificent, but instead sits as a painful eyesore reminder of the breakup of Yugoslavia and its effect on the local economy. For now, Kotor is great to visit on a day trip, but probably not for an extended stay.

Jeremy Ames, Executive Editor

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