Rentals has helped premium class customers in Georgia find the perfect properties for the past ten years. But for Zurab Eristavi, the 25 embassies and 50 international companies Rentals has helped so far are just the beginning.
Rentals is the clear leader in Georgia’s residential and commercial real estate market. But until recently, the company kept a low profile, counting on its reputation as the go-to realtor for embassies and international companies to open doors and bring clients. Now, however, Rentals founder Zurab Eristavi is talking to Forbes Georgia about the secret of their success.
“We have quite a different way of operating,” Rentals founder Zurab Eristavi tells Forbes Georgia. It is evident that he has invested a substantial amount of time, enthusiasm and funds into this business. As a result, he is very keen to ensure that I clearly understand the essence of his business so I can explain it to you properly.
Mr. Eristavi founded Rentals in late 2008 together with his business partner Nana Dvali. They decided to focus on premium-class real estate rentals (apartments, houses, offices and commercial spaces). “It was evident that there was a shortage of high-quality, transparent and fair service in this field. So, I was looking for someone with experience, with whom I could implement my vision, and I was lucky enough to meet Nana Dvali. That is how Rentals was established!” explains Zurab Eristavi.
To its clients, Rentals is much more than just a real estate agent. First and foremost, it is a trustworthy consultant. Its role does not end when an apartment, home, office or commercial space is found – the deal is only completed when the new owner/tenant finally moves in and feels happy about the property. Rentals manages every detail up until that point.
“We virtually only have corporate clients,” says Zurab Eristavi. That niche has allowed Rentals to operate under the radar, without too much publicity for the past ten years.
The company’s clientele can be divided into two main groups: international companies and the diplomatic institutions. Rentals already has a long-standing relationship with embassies in Georgia. It started with just two embassies as clients and now works with 25, including but not limited to the embassies of the European Union, USA, France, UK, Switzerland, Sweden, Netherlands, Austria, Italy, Poland, Norway, Turkey, Brazil and Japan.
Furthermore, the company has established firm ties with various business associations– AMCHAM, DWV, BAG, EBA and GNARE – something which Mr Eristavi views as a significant achievement.
The company is especially proud of its most recent deal: working with the European Union embassy to secure a new office. The EU embassy will soon move into its new office home inside the CH64 premium-class business center at 64 Chavchavadze Avenue. This brand new, 20-storey business center has a total area of 14,000m2, and is part of a special brokerage agreement signed by Rentals. This deal is especially sweet because it has taken eight years for the EU embassy to find the perfect quarters. However, Rentals was able to find the perfect location and the EU embassy will take up residence on the 6th, 7th and 8th floors of the building. Rentals is currently negotiating with five other embassies and several large international companies about space in the same building.
Apart from the European Union, Rentals has also found space for the embassies of Poland, Qatar, Latvia and Netherlands. The company also closely cooperates with international companies. Rentals provides consultancy services to more than fifty global businesses. “We are one of the largest suppliers of clients for nearly all Class A and Class B business centers. Our high-profile corporate deals include KPMG, LG, Bosch, Heidelberg Cement Caucasus, Clean Energy Georgia, Majorel and MDLZ Georgia,” states Zurab Eristavi.
Mr. Eristavi views each international company not only as a client to whom he supplies services, but as an important source of employment in our country. “Georgia is gradually attracting the attention of large international employers. We are one of the first points of contact for these companies’ representatives. We are, therefore, providing a full range of activities, from registering the company to buying furniture. Apart from the business side of things, we also try to personally introduce these companies to core Georgian values, our hospitality and our main attractions.
This adds value to our service, and in this way we ensure that their first of Georgia impressions are positive. That strengthens the companies’ desire to conduct business in this country,” Mr. Eristavi adds.
For instance, he noted that Rentals helped the German company Arvato (now Majorel) establish itself in Georgia two years ago. “We are particularly proud of the fact that Georgia was being considered as one of several alternatives and came out on top. Arvato’s entry to Georgia created around hundreds of jobs in Tbilisi alone, but we are especially delighted that the company also rented an office in Kutaisi, employing a great number of people in this city. When it comes to creating job opportunities for young people, these companies play a crucial part – not just in large cities – but in smaller ones too.”
Official statistics clearly show us that the highest unemployment rate in Georgia is among the 20-34 age group. This is when a person has the most potential and is most open to acquiring new skills and knowledge. It is completely understandable why Zurab Eristavi attaches such a great importance to opening doors for these companies, and to his own role in this process: “No other sector will give us the opportunity to find employment for young people as quickly and effectively as the international companies that are our partners today.”
The management team at Rentals prioritizes communication with clients, listening to them and understanding their needs. “Often, when we listen to the clients’ initial requests and later think them through, we conclude that they need to be fundamentally changed. We offer solutions by taking the number of staff, the specifics of the job and the safety requirements into account.” Mr Eristavi notes that this strategy is how the Georgian firm managed to establish itself in a competitive environment and create such longterm partnerships.
“Anyone who has ever searched for an office or an apartment knows how many questions need to be answered along the way: location, space, daylight, safety standards, budget, parking and more. Rentals is a single point of contact for all these questions. We must also consider the possibility of not being able to find a client’s preferred alternative, in which case this lengthy process might have been in vain.” According to Zurab Eristavi, in ten years of interacting with clients, he can count these cases on just one hand: “We have never been told that we wasted someone’s time.”
Turnover in the Georgian construction sector has been steadily growing in recent years. Although there has been a noticeable slowdown since 2016, this sector has no doubt developed. Wherever you look in Tbilisi; you can see an office, or an apartment building being constructed –sometimes both under the same roof. This trend allows Rentals to provide clients with a broader choice and increased access to modern real estate. On the other hand, as Zurab Eristavi explains, more construction does not necessarily make things easier for his company: “At times, it is the other way around. Our clients demand different standards. For them, chaotic construction means noise, air pollution, spoiled panoramic views and other forms of discomfort. Consequently, a lot of construction is not tantamount to expansion in the niche that our customers need.”
Another interesting market factor that we touch upon during our conversation is the influence that current business regulations, real estate prices and other trends can have on a company like Rentals. According to Mr. Eristavi, global budgets are affected by global trends. “For example, the 2008 global financial crisis began affecting Georgia in 2009. Embassies and foreign companies were then forced to tighten their belts. It was truly a very difficult period for our sector.”
He notes that the company’s founding policy of honesty helped it thrive despite the challenges. “The key to our success is that we never lie. We always tell the facts as they are. We never put our reputation on the line. This approach reflects well on the company in the longer term: a grateful client will always return,” Mr Eristavi states. In fact happy clients express their gratitude through bonus payments and referrals.
“Our approach has allowed us to reach the point that the developed world reached a long time ago. This is the practice of exclusive contracts with real estate owners. Today, it is difficult to convince people in Georgia that it is beneficial for them to do business with one company. However, we still manage to do this. We are proud of the fact that 90% of our exclusive contracts have been converted into actual deals,” states Mr Eristavi. He cites specific examples: Hillside Residence (an 8800m2 building in the Sololaki district), the top two floors of the ProCredit Bank building, and the land plot owned by the Swiss Embassy – all of these were the subjects of exclusive contracts. “Rentals always involves its colleagues in its exclusive projects. We try to achieve our goals through synergy.”
Zurab Eristavi is particularly proud of the occasions when his company’s efforts are appreciated and rewarded. “The Georgian National Association of Real Estate, which unites large number of brokerage firms that operate in this sector, decided to organize an annual awards ceremony recognizing companies that have been successful in various areas of real estate. Rentals received the ‘Best Company of the Year’ award twice in a row, in 2017 and 2018. The assessment process for the award is based on three criteria – revenue, the rating given to your firm by your colleagues from other brokerage firms in the sector, and online voting through social media. In 2017, we also won the ‘Best Broker prize’,” he says.
However, the local market is changing, and Zurab Eristavi is at a crossroads about how to develop Rentals. It is important to choose wisely, as finding the right development path may become more difficult in the future. I never asked him why he agreed to do this interview, but perhaps he feels that the time has come to introduce Rentals to a wider audience.
“What we have to decide now is whether to remain a purely Georgian company (something that we are genuinely proud of), or whether to bring in an international brand,” says Zurab Eristavi. The Rentals brand has been firmly established in the Georgian market for a specific segment to which it offers its high-quality services: “We feel very good. All our clients are happy with us, and we are not limited in our decision-making. This is undoubtedly a positive factor.” Conversely, Zurab Eristavi realizes that large international brands have their strong points and establishing your brand name on the global market has its appeal. “We have to operate in an increasingly competitive environment,” states Mr Eristavi. He sees this as a positive: increased competition is good for the development of the market and the company itself.
In the short term, it seems that the company is set to expand into the wider region. Rentals has already entered the Armenian market, in part due to the requests from existing international clients. “The first serious steps have been taken,” the company founder states. Mr. Eristavi notes that Rentals is always ready to take a risk to develop and thrive in the industry. With this thought, the interview concludes. Zurab Eristavi has spoken to Forbes Georgia for exactly thirty minutes. Our readers, however, will have far longer to form an opinion about the company.
Additional Reporting: Salome Chipashvili.
Photos: Khatuna Khutsishvili