Occupy Vake Park!

Journalist: Studio Monitor
Divider dot 12 February 2015


A controversial project to build a seven-storey, $20-million luxury hotel in one of Tbilisi’s few city-centre green spaces has sparked an unprecedented fightback by environmental campaigns in the Georgian capital – Occupy Vake Park.

Green activists who call themselves ‘guerrilla gardeners’ set up a round-the-clock protest camp in Vake Park several months ago in an attempt to stop the building of the hotel, which they say will deprive the city’s residents of much-needed recreational land.

The struggle to stop the construction work has pitted the activists against developers and investors with powerful political connections and against Tbilisi City Hall, which supports the project. The activists claim that local political leaders are putting business interests above the needs of the community, while City Hall insists that the development lies outside the official borders of the park.

“I believe that a hotel does not belong on the territory of the park. Trees have been cut down. Many trees, about 20 of them, have had their roots damaged beyond repair,” said Nika Davitashvili, one of the guerrilla gardeners.

The activists took turns to stay at the site in tents and keep watch around the clock during unusually cold weather earlier this year, preventing construction equipment and trucks from entering.

“They brought heavy equipment at night, intending to resume construction work. This is why we established a 24/7 watch. There has been peace and quiet since then,” said activist Nata Peradze.

The camp regularly attracts visits from ordinary Tbilisi residents who come to show their support, bringing their children, decorating the trees with colourful banners and hand-drawn pictures, and planting flowers and herbs in the soil.

“It’s not only about Vake Park. This should be prohibited in all of Tbilisi and Georgia,” explained one of them, musician Bakur Burduli.

“Our children and environment are in bad shape, and this does not help at all,” said another, actor Giorgi Giorganashvili.

When the authorities’ plans for the renovation of Vake Park were initially mooted, the green activists opposed it, arguing that it would alter the look of the area entirely. “They developed the Vake Park renovation plan with metal trees in the middle of the fountain. We were appalled and protested,” said Peradze.

But when they examined the plans closely, they found out that the problem was more serious than they had first imagined. “We discovered a piece of land on the blueprint. This is how we learned about this hotel,” Peradze recalled.

Urban planning expert Zurab Bakradze said that this area of land, where the now-derelict Budapest restaurant stood in the park, had been fenced off. “There were some talks about building something. This is how this whole thing started,” Bakradze recalled.

Vake Park is zoned in the ‘recreational area 2’ category under Georgian planning laws, so the construction of a hotel is not allowed there, according to Erekle Urushadze of watchdog organisation Transparency International. “City Hall could issue a permit only as an exception,” Urushadze explained. “We thought that City Hall would never issue a permit, but it did.”

On July 24, 2013, mayor of Tbilisi Gigi Ugulava issued a special zoning permit to build a hotel on a piece of land located at 68 Chavchavadze Avenue, Tbilisi. In September, the capital’s municipal Architecture Service approved a plan for a construction project submitted by the company Graali LLC, and issued a permit.

Environmentalists discovered that the July 24 permit granted the private company exclusive rights to build a hotel in Vake Park, which is located at 68 Chavchavadze Avenue. In the meantime, an advertising banner produced by the construction company advertised that a hotel was to be built in Vake Park.

The city, however, argues that the plot where the hotel is to be built is not legally inside Vake Park.

“City Hall has stated more than once and I reiterate that the territory where the hotel is about to be built has never been incorporated by Vake Park. Moreover, this territory has been privately owned since 1998,” said Malkhaz Kunelauri, head of the City Hall Legal Service.

Zurab Bakradze argues however that this is nonsense: “Everyone, including the owner, City Hall staffers and the deputy mayor, knows that it is Vake Park. The catch is that the territory, where construction works are going on today, is private property, so it is not public property. However, this does not mean at all that it is not part of Vake Park,” he said.

Shrinking green spaces

The decision to create a landscaped park next to Chavchavadze Avenue in the Vake district of the capital was made in 1946. When it opened, it covered 125 hectares of what was previously barren land.

But the area of greenery started to decrease drastically in the 1990s. Today only 20 per cent of the original Vake Park has survived. It even has a different name, Tbilisi Parks LLC. The city’s residents, however, continue to refer to the area stretching from Chavchavadze Avenue to Turtle Lake at the top of the hill above it as Vake Park.

The environmentalists began protest rallies in a bid to stop the green space shrinking further and barricaded the road to the hotel under construction despite attempts by police to disperse them.

Meanwhile the hotel’s investors went on television and tried to prove that the construction project was legitimate.

“In terms of infrastructure, a hotel is much more attractive than a restaurant in every way,” said Giorgi Zakaidze, director of Tiflis Development LLC, which ultimately took ownership of the land and its construction permit after it was sold on by Graali LLC.

The environmentalists appealed to City Hall for the building permit to be rescinded, but their plea was rejected.

Deputy mayor Sevdia Ugrekhelidze met local media to insist that the construction work must go on, describing the activists’ criticism as “a misunderstanding or a provocation”.

“This topic has nothing to do with Vake Park,” she said. “Although it is a recreation area, it is not true that a seven-storey facility will be built here. You can see the design of this hotel. I think it will appeal to those who dislike modernist buildings. This is a quintessential example of Tbilisi architecture, built with light materials, aluminum and glass. It has five floors and a terrace. Of course, it has underground parking and other storage facilities.”

Urushadze however argues that the hotel will ruin the landscape. “It is much larger than the Budapest restaurant. It is ridiculous when they recall the restaurant, because the hotel is larger than the restaurant beyond comparison,” he said.

Peradze meanwhile suggested that the motives of both the developers and local politicians were purely financial: “Probably it is all about money and investments. Either they are uneducated and cannot see the importance of this park or they have financial interests in this.”

High-level political connections

Along with attractions for children, an open-air movie theatre and several playgrounds, the Budapest restaurant was built in Vake Park in the 1958. The state-owned restaurant occupied 480 square metres of the park’s territory. It’s original registered address was Vake Park.

It was privatised in 1995 and bought by 12 of its employees – who included Nugzar Shevardnadze, nephew of then President Eduard Shevardnadze, and his wife and son, Lia Kvirkvelia and Mamuka Shevardnadze.

The staff purchased the property from the state for $18,865, and the shares were split 50-50 between the family of the president’s nephew and the remaining ten employees. After the restaurant was privatised, its registered address changed, and now referred to it being located on “territory adjacent to Vake Park”.

The state included several requirements in the privatisation agreement, prohibiting the buyers from changing the nature of the business and selling the property, while also obliging them to engage in charity work.

A few months after privatisation, the staff of the restaurant established Graali LLC, with Nugzar Shevardnadze as one of its founders. He purchased 67.5 per cent of the shares from the founding partners. As a result, the Shevardnadze family came to hold 77.5 per cent of the shares. After the Law on Land came into force in 1998, 2,864 square metres of Vake Park land were registered as the Budapest restaurant’s property.

When President Shevardnadze was ousted in the November 23, 2003 revolution, MIkheil Saakashvili’s National Movement came into power. In a few months after the revolution, the Shevardnadze family sold its 77.5 per cent of Graali LLC to businessman Alexi Kuchukhidze, who paid just $14,647 USD for the shares.

The Budapest restaurant stopped operating and ultimately fell into ruin. In 2007, Graali LLC once again changed hands. The 22.5 per cent owned by the staff was purchased by Aisi LLC for $112,500, while Giorgi Kapanadze paid Alexi Kuchukhidze $14,650 for the remaining 77.5 per cent.

In July 2013, when Tbilisi mayor Gigi Ugulava issued a permit to build a hotel where the Budapest restaurant used to be, Kapanadze still owned 77.5 per cent of the company. Two years earlier, he found himself at the centre of media attention when he and Giorgi Ghoniashvili, Ugulava’s brother-in-law, became representatives of a company called Real Invest, which bought land which had been given away free by City Hall to the Tbilisi Development Fund without the burden of having to compete at auction. Kapanadze was the deputy chair of the supervisory board of this offshore registered company, while Ghoniashvili served as its director.

While protest rallies against the construction of the hotel were held in Vake Park, the company again changed hands several times. On November 15, 2013, Kapanadze sold his Graali LLC shares for the same price of $14,650 USD back to Alexi Kuchukhidze, raising suspicion about the nature of the deal.

“The fact that from 1996 to 2013 the price never changed must draw the attention of law enforcement. There may have been some foul play,” said lawyer Gagi Mosiashvli.

“If a dirty deal to decrease the price surfaces, then it will entail criminal liability, namely, tax evasion. This issue will surface if the concealed amount exceeds 50,000 Georgian lari,” he added.

On November 28, 2013, Agro Land Georgia LLC purchased the Budapest restaurant and 2,863 square metres of land for $500,000 USD from Graali LLC.

Two days before this deal, Kuchukhidze sold 100 per cent of the nominal capital of Agro Land Georgia LLC to Mamuka Shevardnadze for 200 Georgian lari. This meant that the family of Nugzar Shevardnadze reclaimed the property it had received from the state 17 years earlier.

The permit to build a seven-storey hotel had already been issued – but ten days later, Mamuka Shevardnadze sold the Budapest restaurant along with the construction permit to Tiflis Development for $2,700,000.

Three of the companies at the centre of this story – Graali LLC, Agro Land Georgia, and Real Invest – have a lot in common. All three have the same legal address, 150 Aghmashenebeli Avenue, and share one attorney, Gorda Surguladze. Most importantly, the representatives of these companies are close friends: this is illustrated by a photo that was obtained by Studio Monitor showing Mamuka Shevardnadze, Kapanadze and Kuchukhidze socialising together.

But Ugulava, who served as mayor until December 2013 when he was suspended for the alleged misuse of funds, denied that he had family connections to Kapanadze.

“You are lying. It’s not true,” he told Studio Monitor.

He also denied any links to Nugzar Shevardnadze.

“I have nothing in common with him. Your information is wrong. It’s a false accusation. I have nothing to do with Nugzar Shevardnadze, or his friends, or his children. It’s nonsense!” Ugulava insisted.

Public interests and private profits

As well as staging protest rallies, campaigners made an administrative complaint to City Hall, asking for the July 24 construction permit to be revoked, but without success.

According to the law, City Hall is obliged to meet several important requirements when issuing a special permit to build a hotel in a recreational area, said Urushadze of Transparency International.

“[The permit should say] that construction works must be done out of special needs for urban development, should be compensated by other activities, and should not be against the public interest,” he said.

Urushadze argued that building a hotel does not serve the needs of urban development, and that “all this goes against the public interest”.

But Malkhaz Kunelauri, head of the City Hall Legal Service, argued that “construction works create new workplaces and adorn Tbilisi”.

“There used to be nothing but shabby houses, ruins and debris. This should suffice as grounds for issuing such a permit,” he said.

He also argued that building the hotel was not necessarily against the public interest.

“The balance between private and public interests is a legal norm that requires relevant legal interpretation. Each case should be assessed individually, in court and by lawyers. As you know, this case has been contested in court. So if the judge decided that our decision contradicts public interests, it will be called off,” he said.

However the environmentalists insist that the City Hall decision is illegal because it has not been substantiated in writing by the mayor.

“The law requires such discretionary authority decisions to be substantiated,” said Urushadze.

“Failure to provide it may entail the annulment of this decision. It is not just a formality. It is an important provision that protects citizens from the willfulness of administrative bodies,” he said.

However Kunelauri said that the situation was legal even though nothing had been put on paper.

“If you mean writing down something and including it in documentation, that’s the formal side of this issue. As for the content, it is being investigated by the court and other institutions, and there may be some errors or inconsistencies, but the formal side never defines the content,” he said.

As well as granting Graali LLC a special permit to build a hotel in a recreational area, the mayor also granted the developers enhanced urban development parameters, meaning that their construction could take up more space than is usually allowed under the Law on Public Spaces and Urban Development.

According to urban development expert Zurab Bakradze, this move by Ugulava “violated the law”.

As a result of these enhanced construction parameters, the hotel complex will take up most of the private land, say the environmentalists.

“The building is 27 metres tall, with seven floors, equaling a 9-storey building in size and taking up the whole territory. It has 100 rooms and parking space for 16 cars, which means that the place where we are standing now [in Vake Park] will turn into a parking lot,” claimed Nata Peradze.

Another coincidence that the environmentalists noticed was the simultaneous launch of renovation works in Vake Park, with the Tbilisi municipality allocating $ 2,700,000 for the project. Campaigners suspect that this investment of public funds could have been intended to benefit the hotel project.

“First of all, they replaced communications infrastructure [water and sewage pipes], and that’s when we suspected that these two things could have been related. We thought that the lot intended for the hotel could have had some problems with communications infrastructure, so they needed to improve it,” said Bakradze.

“As a citizen, I have the suspicion that the City Hall made a decision to benefit private interests at the expense of public interests without substantiating its decision,” said Urushadze. “There might be corrupt deals between private interests and a government agency. I have been observing City Hall and its work in green zones, and this is not the first time that something like this has been happening.”

Kunelauri however denied any link between the Vake Park reconstruction and the building of the hotel.

“I see you’re quite interested in tying these events together,” he said in response to Studio Monitor’s questioning. “No one has a right to refuse communications infrastructure work on his or her private property. So such works in Vake Park would involve all private properties on its territory.”

Studio Monitor asked Graali LLC, Tiflis Development and Agro Land Georgia to comment on the issues surrounding the Budapest restaurant and the hotel project, but they declined to respond.

Showdown on the road to Turtle Lake

The guerrilla gardeners first went into action in summer 2013 when the construction of a restaurant was launched in a recreational area on the road to Turtle Lake, above Vake Park, where construction is prohibited by law. The works were carried out by a company owned by Archil Gegenava, a National Movement member of parliament.

A few days before the land was auctioned, its status was downgraded, turning it from a landscape area into a recreation area 3, which allows for the building a restaurant. The initiative by mayor Ugulava to change its status was upheld by the Tbilisi sakrebulo (city assembly).

But Urushadze said he believed that it was the result of a shady deal.

“I have every reason to believe that we are dealing with foul play here. I received no reasonable explanation from City Hall as to why they decided to sell this land lot, downgrade its status, and sell it directly to build a restaurant. There might have been a preliminary agreement between Gegenava and Tbilisi City Hall to build a restaurant there, so this whole procedure is a scam,” he said.

Irakli Shikhiashvili, who at the time was the representative of the National Movement in the city assembly supported the mayor’s initiative. But he said that anything that the powerful Ugulava decided could not be opposed by anyone else at City Hall.

“In 2011, Gigi Ugulava led the city assembly, and he was a member of the Zoning Council, so no one could oppose him. In other words, every decision he had made in advance had to be approved. Somebody’s presence or absence made no difference whatsoever,” Shikhiashvili said.

At first, the guerrilla gardeners tried to stop the process of construction on their own, and then appealed to the Tbilisi city assembly to annul its decision.

But City Hall, now dominated by councillors from the Georgian Dream movement after the National Movement lost its grip on power, refused to revoke the permit.

“The Georgian Dream majority could abolish the previous decision on the status, and then the construction permit would be annulled, but they would not do it. This shows that they are moving in a different direction. They don’t want to change anything in the city,” said Bakradze.

Shikhiashvili, the chair of the Tbilisi city assembly, said the local authorities were “ready to change this decision based on the requests from our citizens and environmentalists”, but it was not possible.

“We were willing to declare a memorandum to prevent issuing new permits in recreational areas. However, we, Tbilisi City Hall, have no leverage to do it on our own,” he said, without explaining why.

Sulkhan Saladze from the Georgian Young Lawyers Association argued however that this was not true.

“If the city assembly says that the decision is unlawful, and that certain provisions were violated, it is authorised to annul this document at its own discretion,” Saladze said.

Activists from the Safe Space environmental NGO contested the decision about the land’s status in court. But the construction works were never suspended, and Tbilisi will soon get yet another restaurant in what was once a green space.

Meanwhile, three separate complaints contesting the hotel construction in Vake Park are being filed at the municipal court, and while the threat of building work remains, the guerrilla gardeners have no intention of leaving the park at the mercy of the developers’ bulldozers.