Russian Tycoon Brings Luxury to Dagestani Mountains

Ziyavudin Magomedov said this weekend that he would back the hotel project.

Russian tycoon Ziyavudin Magomedov's Summa Group plans to invest 200 million euros ($267 million) in a luxury tourism complex in Russia's restive Dagestan region, Kommersant reported Monday.

On the northeast end of the Caucasus mountains, Dagestan has for 15 years been fighting to quell an Islamic insurgency and revitalize a regional economy heavily reliant on subsidies from Moscow.

The Matlas complex, slated to open in the mountainous Khunzakhsky district not far from the Azeri border in 2017, will boast a 60-room hotel occupying 16,000 square meters, a medical center, spa, swimming pool, conference center, golf course and equestrian complex, Kommersant reported.

The project will be managed by state-owned North Caucasus Resorts, or NCR, a company that was set up in 2010 with the remit of developing the region as a tourist destination.

NCR has been hunting for an investor willing to back the project for some time. Akhmed Bilalov, a former head of NCR and a Khunzakhsky district native, had been expected to come forward as the main investor. However, Bilalov, who was deputy president of the Russian Olympic Committee, emigrated last year after being fired from "all positions" by President Vladimir Putin, who blamed him for delays and cost overruns at an Olympic ski jump site in Sochi.

Dagestan native Magomedov, whose wealth is estimated at $1.2 billion by Forbes, told journalists this weekend that he was ready to stump up the cash, according to the newspaper.

Summa Group's press office confirmed that the holding is in talks with NCR about the Matlas project when contacted by Kommersant. NCR declined to comment.

Despite ever-present security fears in Dagestan, where shootouts between militants and security services are commonplace, the region's tourism industry appears to be growing, albeit slowly. Last year, 272,000 tourists visited Dagestan, compared with 240,000 in 2012, and 226,000 in 2011, according to the Dagestan Tourism Agency.

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