Real Estate in Slovenia
Foreign legal entities established in Slovenia benefit from a national treatment regime with regard to the acquisition and ownership of real estate. Businesses incorporated or founded in Slovenia have the same purchase rights and rights to the use of land and natural resources as those enjoyed by Slovenian enterprises, regardless of the amount of foreign-owned share capital.
Businesses not incorporated or founded in Slovenia have the same rights if they have subsidiaries/enterprises based in the EU and all transactions are justified by the primary activity of the business.
Real Estate market
Activities in the Slovene real estate market have been on the rise since the mid 90’s. The process of denationalization brought substantial increase in supply of various kinds of commercial and non-commercial real estate, which was met by the every day growing demand. By the date Slovenia is flooded with nearly 1800 real estate agents and is fully opened to foreign capital.
Three categories of real estate most interesting to foreign investors would be industrial land (business zones), commercial property and tourist oriented real estate.
In Slovenia there are around 350 business zones ranging from 1 up to 108 ha in size. Smaller zones (less than 20 ha) are mainly of local importance, though opened to larger projects. Industrial land (20 to 50 ha) located near main transport routes is already considered as being a pinpoint for regional development. All industrial land is available to foreign investors.
Key business locations
Slovenia has recently developed a number of sites of interest to industry where foreign companies can start up operations as a green-field investment. The main actors in the development of land for industry in Slovenia are local authorities and regional development agencies. A number of private initiatives have also entered the frame recently.
Most of the newly developed industrial zones in Slovenia are located close to rail lines and with direct access to main roads or the highway cross. Infrastructure is mostly well developed and access to service connections is also available.
In some cases, prices for fully serviced industrial land in industrial zones in Slovenia are relatively low, especially for strategic investors; this is due to the fact that infrastructure and land costs are frequently subsidised by municipalities and the state. Local authorities' main goal regarding industrial land development is not profit but the creation of jobs. The price per square metre of land in underdeveloped areas in Slovenia can be very competitive (in the town of Črnomelj is EUR 2), while the prices in the vicinity of Ljubljana or major industrial areas vary from EUR 100-250 per square metre.
Potential investors can also count on a full range of free services provided by local development agencies on the way to start-up. This can also include advice in the process of obtaining all the necessary permits and, in some cases, even the organisation and financing of the construction process in line with the investor’s requirements.
Slovenia property investment is growing in popularity and was recently voted one of the top ten property investment locations in the world by UK TV program A Place in The Sun.
Before crisis hit, Slovenia had been facing a great demand for (low cost, standard and luxury) residence space, mostly apartments in the urban regions, which resulted in numerous projects in residential investments. At the moment prices and transaction levels of residential properties are stable.
Another interesting field is quality office space. Numerous projects for business premises are underway. Ljubljana, being the capital of Slovenia, and Koper, a port city, are mostly affected.
Projects in tourism
Slovenia has a lot to offer in the sense of tourism. Apart from constant expansion of accommodation capacities (hotels, thermal and sea side resorts, ski centres), Slovenia is turning in the direction of restoration and revitalization of castles and mansions with surrounding parks that can be used for luxury hotels or recreational areas.
Ownership of real estate
Most land in Slovenia is privately owned and can freely be sold and purchased.
Citizens of European Union member states may purchase real estate on the territory of Slovenia with no restrictions.
It applies the same for the citizens of Australia, Canada, Iceland, Chile, Israel, Japan, Liechtenstein, Mexico, Norway, New Zealand, Switzerland, Turkey, South Korea and the U.S.
Special conditions apply for the citizens of Croatia, Macedonia, Montenegro and Serbia, who can acquire property rights to immovable property if reciprocity exists. Reciprocity is established in accordance with the Reciprocity Act.
Real estate administrative procedures
PRIVATE REAL ESTATE
Basic steps when purchasing real estate (specific cases excluded):
1. Identification of legal status of the real estate (ownership, mortgage, building and operating permit);
3. Contract (the object, the amount and the procedure of payment, mortgage, the registration clause,...);
4. Payment of deposit;
5. Payment of taxes (2% of the property price Real Estate Transfer Tax, new commercial real estate – 20% VAT);
6. Certification of seller’s signature by a notary public;
7. Submission of proposal to Land Registry.
Purchase of land requires some specific knowledge regarding the national legislation, therefore the involvement of an expert is advised.
PUBLIC REAL ESTATE
The most common procedure used is public auction, followed by public tender and under certain conditions also direct contract. Law on physical assets of the state, regions and municipalities provides principles of conduct, procedures and acts regulating the disposal of real estates owned by municipalities.
Public auction is a public procedure in which the real estate is sold or rented to the highest bidder, who agrees to certain pre-set conditions. The auction is conducted 15-60 day after its publication on municipality’s web site. The publication must include basic information on the real estate and the implementation of the auction.
Public tender is performed by sending out a call for proposals to a specific or unspecified group of persons. Tender documentations specifies the form and the conditions under which the bids should be submitted and gives basic information on the real estate. The real estate is sold or rented to the bidder who offered the lowest costs.
In exceptional cases the real estate owned by the municipality can be sold or rented based on the direct contracts (in case of smaller shares of ownership, lower value of the real estate, if other contractual party is a public law institution,...). Intention to contract must also be published.