ARCI, a Vake-based architecture company, is the first Tbilisi real estate agency to welcome private investments and general market trends. Founded in 1989, ARCI was the first pioneer in Georgia’s new market. Today, as the most experienced, they set trends rather than follow them. The first years of independence in Georgia saw rampant lawlessness, which affected every sphere of economy, architecture including, to different degrees. People wanted to build houses, but they couldn’t because there were no proper regulations. Those rules that could be found had been established in a country that didn’t exist any more. The situation must have been really difficult for the locals with no rules to bend, let alone break! The situation improved slightly in 1999, but things were still unstable. The rich wanted their houses built regardless of any regulations, even if they had existed. As a result, many houses of substandard quality were constructed during that period. However, the fight against strict rules was a no-win situation, and a number of people who had invested their money in construction were left in the lurch with no possibility to recover their losses. However, some decided to fight the odds and nurse a strong belief that law and order would prevail at some stage.

This was a good point for some companies to start from scratch. “That’s why we claim to be the most experienced in Georgia,” says Dato Megrelishvili, ARCI’s investment manager. “We know everything about the market here.” They happen to be more than just a construction company. “We’re into management and project development now,” Dato says. Construction comes to the fore anyway, so how do they cope with the changing market? “First we find an area. The next step is to examine its potential.” How? “Logical reasoning dictates how we can make the most of it. Then we divide the land into districts and work on developing proceeds.” Strict rules apply. “Procurement of the land is first, and then our golden rule follows: to see what others cannot.” How does that translate? “We always try to see greater potential than others. Then we start the construction project.” Then marketing and planning come into play. The ARCI staff have put their heads together and devised a master plan for the territory and how it could be best used by the city. Back in 1996, ARCI won a competition for making better construction rules that the Municipality holds each year. “Now when other companies build, they have to follow our directives.” ARCI seems to have good ideas for places like Kipshidze Street in Vake, which has become an elegant area with embassies dotting the environs. Latvia and Azerbaijan have already settled in. Another grandiose project is underway in Ortachala, as well as Tbilisi’ suburbs. “We were the first to see the potential in these areas. We’ve started and others are just following. We take a lot of risks as pioneers in the area. This is how we’ve made our name.”

But has it always been so rosy? When the economy was in a state of constant flux, misfortune was abundant and it was not easy to prove intentions with evidence. The years between 1992 and 1996 were an ordeal for the company, having just entered the market. When ARCI started construction on Kipshidze in 1992, all the company’s capital was invested in Invertbank - which went bankrupt the same year. The political and economic situation in Georgia at the time was dire, and the war-torn country wasn’t attracting any foreign investment yet. The company lost 2.5 million, which would cause many to give up business and start selling potatoes at the local bazaar. Yet against all odds, ARCI’s staff rolled up their sleeves and over the following six years managed to pay off all the company’s debts. It is now completely debt-free. However, due to the economic vortex, many believed ARCI was at high risk of bankruptcy, and ARCI’s general director Gia Abuladze was labeled a debt master. Over the years, more civilized market conditions have prevailed, and ARCI has overcome bad press. These days ARCI is a sprawling conglomerate, and the number of companies to follow its directives is steadily increasing. They have earned a reputation for accurately tracking current trends and making wise predictions for the future. “We are also proud that in those very difficult times we never faltered. We managed to overcome those hurdles, and today we are a reliable company.”

Vake also has potential for many private projects. “If you look at sales charts – they’re booming!” exclaims Dato. “One of the reasons for this is our policy of adhering strictly to deadlines.” In a country where sense of schedule is beyond relaxed, this IS an achievement. Dato says, “Since 2000, one of our key PR points has been sticking to deadlines.” How is this done? “Georgian contractors are always at least six months behind schedule. We always factor this into the equation, and the flat handover deadline is set accordingly.” ARCI’s policy is individuality. “This is why we don’t want to construct sterile structures like the ones that seem to be popping up throughout the city. We build cozy cottages. For an idea, look at the area behind the church on Chavchavadze.

Building a market is always a formidable process, so how did they manage? What was ARCI’s selling point? “A lot of people used to be afraid to invest here, so we’ve come up with a three-way contract between us, the client and the bank. TBC Bank has been our long-term partner.” Has this contract eased consumer mistrust? “Well, our model contract definitely minimizes risk. We’re a client-friendly company and work according to our templates AND the client’s needs.” There’s an old marketing rule: one happy client brings another, but one unhappy one chases all the rest away. Regardless of marketing strategies, it’s word of mouth that actually does the job. But to everyone’s contentment? “It’s hard to please everyone. Once we had a phone call from one of our clients complaining that the local supermarket had run out of bread.”

Another interesting ARCI policy is to create a common environment. The 20-point “facade contract” stipulates that laundry must not be hung in conspicuous places, the external window frames must not be altered, air conditioners must not be installed anywhere that affects the exterior design – in short, nothing is permitted that alters the design scheme. It’s actually interesting to see how this works in such an unruly society, but there have been no complaints so far. As for interiors, different options are offered and discussed with the client. What if he changes his mind half way through? “As long as he pays, we’ll change whatever he wants.”

Thus far, ARCI hasn’t had any foreign investors. And how has the Latvian Embassy come to be ARCI’s next-door neighbor? “People commonly buy buildings and then rent them out. This also works for real estate pioneers.” As there is really no capital market in Georgia, ARCI is also pioneering the field of financial and corporate bonds. “We have our own projects for all investments, which incorporate financial operations and security. We’re the first!” No matter how successful a company is, it can’t survive without partners, in this case TBC Bank, Edco, Gepra, Pataraia and Partners, BOG, Bank Republic, and ATC, to mention a few.

Now that ARCI’s achievements have come to the fore, the company needn’t worry that the competition will eliminate them from the market. ARCI is working towards posh design with even better margins now, and has no plans to pass the reigns of professionalism to anyone.