Montenegro threatens Sveti Stefan resort deal cancellation - report

According to the active leasehold contract, the hotels should be open and a leasehold fee should be paid, broadcaster RTCG quoted economy minister Nik Djeljosaj as saying earlier this week.

Djeljosaj said he will offer the government to cancel the contract with Adriatic Properties if the hotels on the island stay closed.

Sveti Stefan, one of the main tourist destinations in Montenegro and a landmark area on the Adriatic Sea coast, has been closed for three years now. In 2021, Adriatic Properties decided to close the resort and to launch an arbitration against Montenegro after a government decision to allow partial public access to the resort.

On Tuesday, local hotel operator Sveti Stefan Hoteli [MNE:SSHO] said it was calling a shareholders meeting on June 28 with one of the topics put up for vote being the cancellation of the January 2007 contract on the long-term lease of the Sveti Stefan and Milocer hotels. The hotel operator, controlled by the government and state-funds, gave no further details on the planned move.

Adriatic Properties has signed a 30-year lease agreement with the Montenegrin government to operate the Sveti Stefan island resort, Villa Milocer as well as Villa Marija and Queens Beach Hotel.

Sveti Stefan island became Montenegro's most exclusive resort in the second half of the last century, visited by celebrities like Merilyn Monroe, Bobby Fischer, Sofia Loren and Claudia Schiffer.