Selling a hotel in Croatia

A hotel in Croatia changes owner along one of two routes: through the property together with the business, or through the shares of the company that holds both. On the property route the buyer pays 3 percent real estate transfer tax unless the turnover carries the 25 percent VAT, and on the seller's side the legal form decides whether any tax arises at all.

The question that Croatian hotel transactions actually fail on appears in neither of those two calculations. It asks who owns the land under the house.

For a considerable number of houses on the Adriatic the answer is: the municipality and the Republic.

Ninety percent of the overnight stays come from abroad

For 2025 the Državni zavod za statistiku, the Croatian Bureau of Statistics, reports 20,698,963 arrivals and 94,820,989 overnight stays in commercial accommodation, up by 2.2 and 1.2 percent respectively on 2024. Foreign guests accounted for 85,612,104 overnight stays, which is 90.3 percent.

That ratio is the most important figure of the market for a buyer. A house whose occupancy is carried nine tenths by guests from abroad hangs on flight connections, exchange rates and the economic cycle in a handful of source markets. The largest of them is Germany with 21,030,521 overnight stays, around a quarter of the foreign volume.

The hotel industry in the narrower sense is the smaller part of the market and the growing one at the same time. Hotels and similar accommodation carried 26,250,215 overnight stays in 2025 according to the same source, 27.7 percent of the total volume, on an increase of 2.7 percent. Counted are 1,083 businesses with 174,591 permanent beds, in the narrower hotel segment 728 businesses with 121,632 beds, of which 24 houses have two stars, 267 three, 376 four and 61 five.

A market with 376 four star houses is not an anonymous market. The operators know one another, and an intention to sell gets around in Istria as fast as it does in an Alpine valley.

The second factor is the season. The Hrvatska narodna banka, the Croatian National Bank, reports travel receipts of 15,297.8 million euro for 2025, of which 9,037.1 million euro fell in the third quarter. Around 59 percent of the year falls into three months. Bed occupancy across the year stood at 60.6 percent, and a capitalisation rate taken from a city hotel occupied all year round does not fit a seasonal house on the Adriatic. How that calculation is built up is set out in What a hotel is worth.

No figure for transaction volume appears here. In the research for this article no freely accessible publication could be found that quantifies the annual hotel investment volume for Croatia.

The first question is about the land under the house

In the conversion and privatisation of the nineteen nineties the buildings of many hotels and campsites were valued, but the plots were not. That unvalued tourism land is to this day the real point of review in every Croatian hotel transaction.

Anyone working with the old legal basis is working with a repealed act. The Zakon o turističkom i ostalom građevinskom zemljištu neprocijenjenom u postupku pretvorbe i privatizacije of 2010 applied until 1 May 2020. In its place came the Zakon o neprocijenjenom građevinskom zemljištu, the Unvalued Construction Land Act, NN 50/20.

Its art 4 divides a hotel plot into three parts. The company owns the building and the land under the building's footprint. The tourism land beyond that, which serves the ordinary use, is owned by the municipality, and the remainder by the Republic of Croatia. For campsites the unvalued parts fall to the state under art 16.

What the company holds instead is a strong position as lessee by operation of law. The contract runs for 50 years, it cannot be terminated unilaterally as long as the activity is carried on without interruption and payment is made on time, and the leasehold right is to be entered in the land register, art 9. The company may buy the plot at market value at any time without a tender, art 11.

One provision reaches straight into the operating structure. Art 9 para 6 prohibits subletting unless the hotel is let as a technologically and functionally closed unit. Anyone acquiring a house with an operator agreement checks that limit before he values the contract. What else counts in a lease is set out in Lease, management or own operation.

The price of that lease has been regulated since 2024. The Uredba of 9 February 2024, a government regulation, names a range of 1.50 to 3.00 euro per square metre and year for Istria, Primorje-Gorski kotar, the coastal part of Lika-Senj, Zadar, Šibenik-Knin, Split-Dalmatia, Dubrovnik and Zagreb, and 0.20 to 1.00 euro for the rest of Croatia, and it caps the rent at 4 percent of the previous year's turnover.

Four documents therefore decide whether a house can be sold: the declaratory decision under art 8, the written lease agreement, the entry of the leasehold right in the land register and the remaining term of the 50 years. Where one of them is missing, the sale begins with an administrative procedure.

At the water's edge the land register stops

The second special case concerns the strip between the house and the sea. It belongs to nobody, and it cannot be bought.

The Zakon o pomorskom dobru i morskim lukama, the Maritime Domain and Seaports Act, NN 83/23, declares the maritime domain a common good of interest to the Republic in art 4. Art 5 draws four conclusions from that, all of them uncomfortable for a buyer: ownership of it cannot be acquired on any legal ground, it cannot be the object of a lease or tenancy agreement, structures firmly attached to it are accessories, and nobody can rely there on the public faith of the land register. Legal transactions to the contrary are void.

A land register extract that assigns beach areas to the hotel is therefore not evidence. It is an indication that the boundary of the maritime domain was never determined.

The area is used through a concession. Under art 48 it is an administrative contract and is granted in principle through a public collection of offers; among the permitted uses are catering facilities and the economic use of a sea beach, art 49. The terms are graduated: up to 50 years at government level, up to 20 years at county level, at most five years for natural sea beaches, art 52 and art 55.

For houses of four stars and above art 63 provides a route of its own: a concession on application without a tender for a developed public beach that is connected to the hotel by infrastructure, for at most five years and against at least twice the comparable value last put out to tender. The beach stays public. Fencing it in, charging admission or excluding common use are prohibited under art 76.

One change of terminology regularly leads practitioners astray. The former koncesijsko odobrenje, the concession approval, no longer exists. In its place comes the dozvola na pomorskom dobru, the permit on the maritime domain, under art 71, which covers only activities of lesser significance, runs for two to five years and may not be exercised through third parties. A decision granting a permit in place of a concession is void under art 71 para 12.

On a sale the question of transfer arises. Art 66 Zakon o koncesijama, the Concessions Act, permits it with the written consent of the grantor to a suitable third party and names the acquisition of ownership in the concessionaire expressly; art 63 para 3 classifies a change following a restructuring as an immaterial amendment of the contract.

From this follows a structural difference that weighs more heavily in Croatia than in the Alps. A share purchase leaves the concessionaire formally unchanged, a purchase of the assets needs the consent of the authority. Which structure otherwise carries which consequences is set out in Asset deal or share deal. The position is checked in the public concessions register, in which every concession is to be entered within 30 days.

Three percent or twenty five, and the order decides

The real estate transfer tax amounts to 3 percent under art 12 Zakon o porezu na promet nekretnina, the Real Estate Transfer Tax Act. The acquirer owes the tax, art 6, and the basis of assessment is the market value at the moment the tax arises, art 9, with the tax administration free to make its own estimate where a purchase price is conspicuously low. The notary transmits the deed electronically within 30 days, art 18; payment follows within 15 days of service of the assessment, art 26.

What counts is the sentence before that. Art 5 para 2 takes out of the scope every acquisition that carries VAT. So the two taxes never stand side by side, and which of them applies is decided not by the contract but by the age of the building.

Under art 40 para 1 lit j Zakon o PDV-u, the Value Added Tax Act, the supply of buildings and of the land on which they stand is exempt. Excepted are supplies before first use and those within two years after it. Under para 5 a reconstructed building also counts as a new build supply where the reconstruction costs of the last two years exceeded 50 percent of the sale price.

That reconstruction rule is the point at which a refurbishment just completed tips the tax position of a house. It belongs before the investment decision.

For older houses the option remains. Art 40 para 4 allows the supplier to opt for taxation where the buyer is a taxable person with a full right to deduct input tax out of that supply; the tax is then owed under art 75 para 3 lit c by the acquirer registered in the Croatian register.

Worked example. On a purchase price of 20 million euro, 3 percent real estate transfer tax comes to 600,000 euro, which the buyer bears definitively. Where the option is exercised instead, 5 million euro of VAT arises, which an acquirer with a full right of deduction neither pre finances nor bears definitively under the reverse charge. The difference is decided by the buyer's right to deduct input tax, not by negotiating skill.

For the sale of the business as a whole a separate route applies. Art 7 para 9 Zakon o PDV-u treats the transfer of the whole of the assets, or of a part forming an economic unit, as no supply at all; the acquirer counts as legal successor. The Pravilnik, the implementing ordinance, requires in art 19 that both sides are taxable persons and that the acquirer continues the activity. Whether a particular hotel business meets that is a question of interpretation in the individual case and belongs before the tax adviser before the draft contract stands.

On the seller's side a two year period separates the cases

Where the house sits in a company, the gain runs through the profit tax. Art 28 Zakon o porezu na dobit, the Profit Tax Act, names 10 percent where revenue in the tax period stays up to 1,000,000 euro, and 18 percent from that threshold. Art 5 para 4 makes clear that a gain from a sale also falls into the basis of assessment and is measured by the market value of the assets. The act knows no special rate for capital gains.

For natural persons a period applies that is markedly shorter than the German one. Under art 58 para 2 Zakon o porezu na dohodak, the Income Tax Act, the gain stays tax free where more than two years lie between acquisition and disposal. Anyone disposing of more than three properties of the same kind within five years is taxed under para 3 regardless, and in a building with several units each unit counts separately. The rate is 24 percent, art 62.

In practice that period rarely matters for hotels, because the house almost always sits in a company. It is quoted in first conversations all the same, usually confused with the German ten year period.

A third factor is new since 2025 and concerns current operations. Since the amendment NN 152/24 the municipalities have been obliged to levy an annual property tax. Under art 26 Zakon o lokalnim porezima, the Local Taxes Act, it runs from 0.60 to 8.00 euro per square metre of usable area and year, and the reference date is the owner on 31 March. The catalogue of exemptions in art 27 essentially covers property serving permanent residence; hotels do not appear there. At several thousand square metres of usable area that belongs in the buyer's projection.

EU buyers are treated as nationals, everyone else needs reciprocity

The Zakon o vlasništvu i drugim stvarnim pravima, the Ownership and Other Rights in Rem Act, governs acquisition by foreign persons from art 354. The definition in art 355 is the practically most important sentence: foreign means a natural person without Croatian citizenship and a legal person with its seat outside Croatia. A Croatian company in foreign shareholder hands does not fall under it.

For nationals and legal persons from EU member states, art 358.a withdraws the restrictions entirely. They acquire under the same conditions as Croatian nationals and companies with their seat in Croatia. Agricultural land and legally protected parts of nature stay excluded.

For acquirers from third countries the strict regime remains. Art 356 requires reciprocity and the consent of the minister responsible for justice. Without it the transaction is void under art 357, and after a refusal a fresh application for the same property is possible only after five years. The nationality and the seat of an interested party therefore belong in the preliminary review.

The legal position is in motion. An amending act of 21 March 2025 recasts art 358.a and extends equal treatment to further groups of states; under its art 3 it enters into force only on the day of Croatia's accession to the OECD. Whether that accession has been completed could not be clarified in the research, and for that reason no statement about it appears here. For buyers from the EU nothing changes in either version.

The employment contracts transfer, and the works council has a say

Art 137 Zakon o radu, the Labour Act, governs the transfer of undertaking. Where an undertaking or an economic activity passes by a change of status or by legal transaction and the unit retains its economic coherence, all employment contracts transfer by operation of law. The acquirer takes over the acquired rights in unchanged form and unchanged extent.

The transferor has to inform the acquirer in writing and truthfully about those rights. The works council and the employees concerned are to be informed in writing in good time before the day of transfer, about the date, the reasons, the consequences and the measures envisaged. The act names no period in days for that.

What is bindingly timed, by contrast, is the consultation. Art 150 lists the transfer of undertaking as a decision requiring consultation, the works council states its position within eight days, and a decision taken in breach of that duty is void. That is a condition of validity and not a formal remainder.

Two consequences reach beyond completion. An existing collective agreement continues to apply to the transferred employees until a new one is concluded, for one year at most. And the acquirer is jointly and severally liable for the obligations towards the employees that arose up to the day of transfer; the wording of the act contains no time limit on that liability. In a seasonal business the list of open claims out of overtime, supplements and leave is therefore a component of the price and belongs in the contract as a figure.

The stars hang on the decision, and the decision hangs on the operator

Categorisation is governed by the Pravilnik o razvrstavanju, kategorizaciji i posebnim standardima ugostiteljskih objekata iz skupine Hoteli of 2016 in the version of 2019. Hotel, aparthotel and turističko naselje, the tourist resort, carry two to five stars, turistički apartmani, tourist apartments, two to four; hotel baština, the heritage hotel, and difuzni hotel, the diffuse hotel, carry no category. The ministry is competent for the group of hotels, and only an administrative action lies against its decisions.

Two mechanisms bring movement into a decision that owners like to regard as permanent. First, it carries no expiry date, but the ministry carries out a fresh categorisation every four years of its own motion; where the house no longer meets the conditions, a different category is set or the decision is revoked, and the operator bears the costs. Second, the decision is issued on the application of the operator, which is why a new operator needs one of his own. The procedure is shortened where type and category continue unchanged.

Without a decision there is no operating, art 19 Zakon o ugostiteljskoj djelatnosti, the Hospitality Industry Act. For hotels a provisional operation of one year at most is possible where the decision on the type exists and the building is fit for use under building law.

New since 1 January 2025 is a quantitative steering at municipal level. Under art 21.a these decisions are issued in accordance with a resolution of the municipal representative body on the number, type, category and capacity of accommodation facilities in the destination. Anyone buying a house with expansion in mind checks that resolution before he prices it in.

Who buys in Croatia

The circle of buyers for a larger house on the Adriatic breaks into three groups, and they calculate differently.

The first are the listed Croatian groups. Valamar Riviera reports total revenues of 465.3 million euro for 2025, up 10.7 percent, with 88.0 percent of turnover from foreign markets and investment of 304 million euro in the years 2023 to 2025. Maistra comes to 261 million euro of sales revenue, Plava laguna to 253.3 million euro, Arena Hospitality Group to 144.5 million euro, the last of these across five countries.

What is remarkable about those reports is what is missing from them. None documents a completed hotel acquisition in Croatia for 2024 or 2025; the large amounts flow into own development and renovation. Anyone who wants to sell to those groups is selling against the alternative that they build themselves.

The second group comes from the German speaking countries. Germany is the largest source market of the Croatian hotel industry, and a considerable part of the private buyers knows the Adriatic first as a guest. That group decides faster than an investment committee, but it asks earlier about the land register, the concession and the operating permit.

The third group is international capital with an operator attached, looking to put a brand on an existing house. For them the categorisation is a condition of the brand agreement, and the remaining term of the beach concession an item in the investment calculation. Which houses we handle in which markets is set out under Markets.

A sale begins in the land register, not in the sales memorandum

The sequence that works in Croatia differs from the one in Austria or Germany at one point: the review of the documents stands at the beginning of the process and not in its middle.

The public faith under art 8 Zakon o zemljišnim knjigama, the Land Registry Act, protects the acquirer in good faith who had no sufficient ground for doubt. Where land register and cadastre diverge, the land register data govern the registered rights under art 11. Registered under art 35 are, alongside ownership, also tenancy, lease and concessions; the statutory leasehold status in the tourism land and the beach concession can therefore be checked in the land register.

Legalisation is a chapter of its own. The Zakon o postupanju s nezakonito izgrađenim zgradama, the act on dealing with unlawfully constructed buildings, applies in the version in force since 16 May 2026. A building erected without or contrary to a building permit can be legalised where it is visible on the orthophoto map of the aerial survey from 21 June 2011; before the decision a retention charge falls due. In older houses with extensions, converted attics or pool areas added later, that is no formality.

The rest of the process follows the same order as any confidential sale. Assessment out of the earnings, preparation of the documents, a buyer list by name, an approach without naming the property, a confidentiality and non circumvention agreement, documents in graduated depth, letter of intent, due diligence, contract. In our experience a prepared house takes six to twelve months between the first conversation and completion; preparation takes longer in Croatia, because land register, tourism land and concession are three separate procedures.

Anyone who opens those three points only in due diligence negotiates them under time pressure and against a buyer who knows that the seller did not know them himself.

A house in Istria and the question that came too late

An owner on the western coast of Istria had prepared everything a seller usually prepares. Three years of adjusted figures, a good season, a buyer from southern Germany who knew the house as a guest, and a letter of intent with four months of exclusivity.

In the sixth week of the review the buyer's lawyer asked a single question. It concerned the plot between the building and the seafront promenade, on which the terrace of the restaurant stands.

The answer took three months. It consisted of a declaratory procedure, an appointment with the municipality and the realisation that the terrace held a permit rather than a concession, which would not have sufficed for that use. The buyer stayed, the price fell, and the exclusivity had long ceased to be a secret in town.

It could have been repaired a year earlier, for the price of two weeks of administrative work and an enquiry to the concessions register. Why a sale runs without a listing is set out in Why the best hotels never come to market.

Croatia rewards sellers who know their own documents and punishes everyone else with time. Where your house stands in that calculation we clarify before any further step, confidentially. How we lead transactions is set out under Transaction, the assessment that precedes it under Valuation and feasibility.

Sources

This article reflects the position as at 23 September 2026. It does not replace tax or legal advice. Every individual case needs review by a tax adviser, lawyer or notary in Croatia. The legislative texts are taken from the consolidated versions of the zakon.hr database; before any legally binding use, every citation belongs checked against the official gazette Narodne novine.

• Zakon o porezu na promet nekretnina (Real Estate Transfer Tax Act), NN 115/16 und 106/18, zakon.hr, 2026. https://www.zakon.hr/z/69/zakon-o-porezu-na-promet-nekretnina
• Zakon o porezu na dodanu vrijednost (Value Added Tax Act), zakon.hr, 2026. https://www.zakon.hr/z/1455/zakon-o-porezu-na-dodanu-vrijednost
• Pravilnik o porezu na dodanu vrijednost (VAT implementing ordinance), Ministarstvo financija, zakon.hr, 2026. https://www.zakon.hr/c/podzakonski-propis/60055/
• Zakon o porezu na dobit (Profit Tax Act), zakon.hr, 2026. https://www.zakon.hr/z/99/zakon-o-porezu-na-dobit
• Zakon o porezu na dohodak (Income Tax Act), zakon.hr, 2026. https://www.zakon.hr/z/85/zakon-o-porezu-na-dohodak
• Zakon o lokalnim porezima (Local Taxes Act), version NN 152/24, zakon.hr, 2026. https://www.zakon.hr/z/875/zakon-o-lokalnim-porezima
• Zakon o vlasništvu i drugim stvarnim pravima (Ownership and Other Rights in Rem Act), zakon.hr, 2026. https://www.zakon.hr/z/241/zakon-o-vlasnistvu-i-drugim-stvarnim-pravima
• Zakon o izmjeni Zakona o vlasništvu i drugim stvarnim pravima (act amending the Ownership Act), Narodne novine 52/2025 of 21 March 2025. https://narodne-novine.nn.hr/clanci/sluzbeni/2025_03_52_674.html
• Zakon o pomorskom dobru i morskim lukama (Maritime Domain and Seaports Act), NN 83/23, zakon.hr, 2026. https://www.zakon.hr/z/505/zakon-o-pomorskom-dobru-i-morskim-lukama
• Zakon o koncesijama (Concessions Act), zakon.hr, 2026. https://www.zakon.hr/z/157/zakon-o-koncesijama
• Zakon o neprocijenjenom građevinskom zemljištu (Unvalued Construction Land Act), NN 50/20, zakon.hr, 2026. https://www.zakon.hr/z/2549/zakon-o-neprocijenjenom-gradevinskom-zemljistu
• Uredba o uređenju zakupa na turističkom zemljištu na kojemu su izgrađeni hoteli i turistička naselja (government regulation on leases of tourism land built on with hotels and resorts), Vlada Republike Hrvatske, Narodne novine 16/2024 of 9 February 2024. https://narodne-novine.nn.hr/clanci/sluzbeni/2024_02_16_276.html
• Zakon o radu (Labour Act), zakon.hr, 2026. https://www.zakon.hr/z/307/zakon-o-radu
• Zakon o ugostiteljskoj djelatnosti (Hospitality Industry Act), zakon.hr, 2026. https://www.zakon.hr/z/151/zakon-o-ugostiteljskoj-djelatnosti
• Pravilnik o razvrstavanju, kategorizaciji i posebnim standardima ugostiteljskih objekata iz skupine Hoteli (ordinance on the classification and categorisation of hotels), Ministarstvo turizma, Narodne novine 56/2016. https://narodne-novine.nn.hr/clanci/sluzbeni/2016_06_56_1451.html
• Pravilnik o izmjenama i dopunama (amending ordinance), Ministarstvo turizma, Narodne novine 120/2019. https://narodne-novine.nn.hr/clanci/sluzbeni/2019_12_120_2375.html
• Zakon o zemljišnim knjigama (Land Registry Act), zakon.hr, 2026. https://www.zakon.hr/z/103/zakon-o-zemljisnim-knjigama
• Zakon o postupanju s nezakonito izgrađenim zgradama (act on dealing with unlawfully constructed buildings), version NN 48/26, zakon.hr, 2026. https://www.zakon.hr/z/486/zakon-o-postupanju-s-nezakonito-izgradenim-zgradama
• Dolasci i noćenja turista u komercijalnom smještaju u 2025. (arrivals and overnight stays in commercial accommodation in 2025), Priopćenje TUR-2025-1-2, Državni zavod za statistiku, 26 February 2026. https://podaci.dzs.hr/2025/hr/97093
• Turizam u 2025. (tourism in 2025), Statistička izvješća 1747/2026, Državni zavod za statistiku, 30 June 2026. https://podaci.dzs.hr/2026/hr/122420
• Table H2 Balance of payments, goods and services, Hrvatska narodna banka, as at 30 June 2026. https://www.hnb.hr/statistika/statisticki-podaci/sektor-inozemstva/platna-bilanca
• Godišnji izvještaj za 2025. (annual report 2025), consolidated, Valamar Riviera d.d., 2026. https://valamar-riviera.com/wp-content/uploads/2026/04/godisnji-izvjestaj-za-2025-konsolidirani-pdf.pdf
• Godišnji izvještaj za 2025. godinu (annual report 2025), Maistra d.d., 2026. https://www.maistra.com/kompanija/tromjesecna-izvjesca/
• Godišnji izvještaj 2025 (annual report 2025), consolidated and audited, Plava laguna d.d., Zagrebačka burza, 28 April 2026. https://eho.zse.hr/financijski-izvjestaji/view/31736
• Godišnji izvještaj s financijskim izvještajima 2025. (annual report with financial statements 2025), consolidated and audited, Arena Hospitality Group d.d., Zagrebačka burza, 26 February 2026. https://eho.zse.hr/financijski-izvjestaji/view/31006