Property rights controversy dogs Georgia's privatization campaign

Paul Rimple 8/22/07

A string of police-led property seizures in Tbilisi is stirring up fresh controversy around Georgia's long-controversial privatization campaign.

The Tbilisi city government, a key ally of President Mikheil Saakashvili, maintains the process is all about making sure that property ownership follows the letter of the law. Amid a real estate boom in the Georgian capital, however, affected tenants charge that profit, rather than principle is driving evictions in many cases. [For details, see the Eurasia Insight archive].

A lack of clear legal guidelines for the process only adds to the muddle, leaving some NGOs and opposition members claiming the seizures are "criminal."

Several recent evictions illustrate the challenge. On August 20, the Union of Writers was turned out of its building, a downtown property that the Ministry of Economic Development says is state-owned. A small opposition party, a journalist union and two newspapers were evicted from two other downtown buildings, as well. The affected tenants claim that the Ministry of Justice police detachment sent to remove them from their offices did not have proper eviction papers, and that their leases remain valid.

Deputy Ombudsman Gio Giorgadze agrees. "They did not give any warning to these organizations," he commented on Rustavi-2 television. "Also, the lease contracts under which these organizations were tenants in the building have not been terminated. This means that the employees of the executive police have abused their authority."

Ten days earlier, a similar scene occurred when dozens of police officers set up barricades and prevented employees from entering the state-owned Samshoblo (Motherland) Publishing House, a sprawling complex on prime real estate which houses an Internet café, retail outlets as well as offices for newspapers, magazines and a TV station. The government again charged illegal occupancy. Tenants of some of the building's rented space were later allowed to return.

"Don't think any state-owned building lets people stay rent-free," commented Deputy Tbilisi Mayor Mamuka Akhvlediani. "They were warned a year ago they would have to leave." The television station, Kavkasia, has turned down a central government offer to help pay its rent, Civil.ge reported.

One international investor has also been affected. On August 7, police blocked the entrance to the Sony Centre in downtown Tbilisi, blocks away from parliament, and evicted the business from the premises, along with a café and one other small enterprise. The owner of the building, the Ministry of Economic Development, reportedly intends to sell the property.

Joseb Kokoladze, the general director of the Sony Centre, maintains that the ministry is obliged under the law to uphold a lease contract Sony signed with the building's previous owner. That contract does not expire until 2015. The company may cancel one investment project for the Black Sea port city of Poti as a result, he added.

Despite repeated attempts, representatives of the Ministry of Economic Development were not available for comment. Deputy Mayor Akhvlediani, however, asserted that the ministry could ask city police to remove occupants with a five-day advance warning.
Perhaps the most controversial incident to date involved the July 20 eviction of 24 residents of a 13-storey building on downtown Tbilisi's Tabukashvili Street – adjacent to the planned site of a luxury hotel. The city argued that the building, constructed in 2004, was structurally unsound. But residents counter that inspections show that the building was safe. They allege that the city wanted to destroy the building because it had sold its land plot to the hotel chain.

"About a year and a half ago some city officials came to tell us they didn't like our building, that it was ugly and built with old methods," recounted Manana Machavariani, one of the evicted residents. "We got documented proof from relevant experts that the building was, in fact, safe and seismically stable."

A Tbilisi court ruled on March 26 that the city government was prohibited from dismantling the building "without taking relevant administrative proceedings." The demolition stopped, temporarily. But a July 4 resolution passed by the Tbilisi City Council that allowed the removal of buildings deemed unsafe resulted in the residents' eviction and the start of demolition.

Tbilisi Deputy Mayor Akhvlediani denies that the city sold the apartment building's land out from under its owners. "That plot belongs to those people," he said. The building was demolished because five floors had been "added illegally," and construction had occurred "without the proper permits," he alleged. Residents had been warned for three years to vacate their flats, he added.

In turn, the deputy mayor insists that the luxury hotel's developers have agreed to reimburse the apartment owners at a rate of $1,400 per square meter, as well as offer them new apartments in another downtown location. Residents, however, tell EurasiaNet that they are prepared to file a case against the city in the European Court of Human Rights in Strasbourg.

Georgian Young Lawyers Association (GYLA) head Giorgi Chkheidze, an outspoken critic of the way the city's handling of property disputes, argues that owners needed the right to appeal the demolition. Attorneys for building residents say that they never received an invitation to a hearing about the dispute, he added. "[T]he process should be done legally with owners having the right to appeal," he said. Until the July 20 eviction, he continued "[a]ll the city said was 'let's talk about compensation.'" In response, the GYLA is offering free legal assistance to evicted property owners, Chkheidze said.

Editor's Note: Paul Rimple is a freelance journalist based in Tbilisi.

Posted August 22, 2007 © Eurasianet