Author: Manana Vardiashvili
A businessman Konstantine Morgoshia is an active supporter of pro-Russian groups. He was a member of “The Patriot Alliance,” then led “The Georgian March.” Later, he left the organization and became partner of pro-Russian businessman Levan Vasadze.
Currently, Morgoshia and Vasadze run the homophobic group “Alternative for Georgia” together.
When Archil Tatunashvili was tortured and killed in Tskhinvali, Morgoshia travelled to the occupied territory with the aim to negotiate the transfer of the body. Although he was just an ordinary Georgian citizen, he chose to enter the territory controlled by Ossetians. This fact suggests that Morgoshia may possess some level of influence in the occupied territory, as he was not arrested. For instance, doctor Vazha Gaprindashvili was arrested and spent 50 days in Ossetian prison.
Morgoshia maintains a stable and positive relationship with the “Georgian Dream” government. Unlike his experience with the previous government, when he faced arrest on charges of fraud and embezzlement of state property. Additionally, according to Morgoshia, his family was coerced by the “United National Movement” to give up a five percent stake in the Marco Polo hotel in Gudauri to the authorities.
Following these events, Morgoshia asserts that he adopted a more cautious approach, refraining from registering properties in his name. He explains that this decision provides him with a greater sense of security.
“I ensure that all financial obligations for any property I associate with are met. Doing so ensures that the state does not suffer any financial losses due to my actions. Whether I feel at ease in sneakers or a tuxedo is entirely my prerogative.”
Morgoshia employed the strategy of using the names of others with the “Georgian Dream” government. For example, the son of a friend of Morgoshia, Davit Isakhanashvili, has been involved in business transactions with the government, acquiring significant amounts of real estate.
In 2015, at 23 and while pursuing studies at the Caucasus International University, Isakhanashvili received valuable properties from the National Property Agency at nominal prices. All correspondences with the National Property Agency explicitly stated his commitment to fulfilling obligations “personally and/or through a third party(s).”
One of the third parties through which Isakhanashvili conducts his investments is Morgoshia’s company, “Grande Group Georgia” LLC.
Morgoshia does not deny this fact in our conversation, stating, “Davit Isakhanashvili is a young guy. He is not an investor. He is my friend’s son whose name is the company registered. Dato is a very promising guy and a dentist; he has nothing to do with business at all.”
When questioned about the transfer of state-owned real estate to Davit Isakhanashvili without Morgoshia’s name being included in the decree, Konstantine responds, “It shouldn’t be included; it is not necessary.”
Konstantine Morgoshia holds shares in two companies and is a director for five others. These organizations include “Grande Group Georgia” LLC, “Investment Group Konstantine,” “Caucasus,” “Alternative for Georgia,” “Kem Construction” LLC, and “Magnus Design” LLC. According to him, he acts as a “case manager” and collaborates with 5-6 companies whose partners are Georgian businessmen residing in various CIS countries along with their associated foreign partners. He refrains from disclosing the names of these businessmen. Morgoshia asserts that he funds his political activities using his finances, being the primary financier of “Georgian March” previously and currently providing financial support to “Alternative for Georgia.” He adds that his contributions are not substantial.
What Property did Konstantine Morgoshia Receive from the Government?
By Prime Minister Gharibashvili’s decision, Davit Isakhanashvili received a 2653 square meter non-agricultural plot of land, including an archaeological base in Mtskheta, located on 27 Davit Aghmashenebeli Street. This property was, through direct procurement for the symbolic price of 1 GEL.
In the statement submitted to the National Agency of State Property, Morgoshia outlines his intention to develop a 75-room hotel complex on this land through the initiative of “Grande Group Georgia” LLC, with financing from a private investor. In return, he commits to constructing a new building for the archaeological base on a 1-hectare non-agricultural plot of land owned by the state in the Armazi Valley.
This project has been thoroughly discussed and agreed upon with government officials. The proposed investment aligns precisely with the assessed value of the land, as determined by the Levan Samkharauli Bureau of Expertise on December 3, 2014, almost a year prior. The bureau valued the land, including the building, at 494,675 GEL. Morgoshia’s proposed obligations have been conveyed to the government decree with a slight alteration.
In addition to the archaeological base, Davit Isakhanashvili, representing Morgoshia, also acquired another 2,530 square meters of land in Mtskheta, along with the 270 square meter roof of the rowing club, which was purchased for a total of 172,000 GEL.
Morgoshia partially fulfilled the commitment made to the government by constructing a two-story building for the archaeological base of Mtskheta on a 10,350 square meters plot of land in the state-owned Armazi valley. However, there is no evidence of hotel construction at the 27 of Aghmashenebeli Street. According to Morgoshia, the proposed hotel site falls within the cultural heritage protection zone, and until the development plan receives approval, all construction activities in the area are prohibited.
The government’s transfer of property to Morgoshia extended beyond this instance. Between 2014 and 2018, Morgoshia, once again under Isakhanashvili’s name, acquired 163 hectares of agricultural land from the National State Property Agency in the village of Mukhrani, Mtskheta district, for which he paid 170,000 GEL.
Subsequently, Davit Isakhanashvili sold all the plots of land in Mukhrani, acquired from the National State Property Agency, to Vectrum 2015 LLC. Isakhanashvili is the founder, director, and sole proprietor of this company. The transformation of the property into an LLC serves as a legal safeguard in Georgia. In the event of a legal dispute, the LLC assumes liability with its assets, protecting the founder’s personal property from any claims.
According to the initial terms of the investment agreement, the investor was required to allocate at least 60 percent of the Mukhrani land for perennial plant cultivation and invest 1.7 million GEL. Additionally, they were tasked with constructing a fruit processing plant valued at half a million and establishing a farm with 40 cattle valued at 130 thousand GEL. However, in 2018, these obligations underwent modifications, mandating planting fruit trees across the entire land area and an increased investment of 2.83 million GEL.
“Grande Group Georgia” LLC’s statement indicated a total investment of 35 million GEL for both the Mtskheta hotel and the Mukhrani agro-complex. These projects should collectively employ 100-120 individuals.
The Mukhrani agro complex spans 177 hectares, with 140 hectares allocated for Chandler walnut orchards, according to Morgoshia. (We requested an audit report on fulfilling investment obligations; however, the National Property Agency did not provide this information). Morgoshia asserts that he has already spent 12 million GEL on orchard planting, with plans to extend walnut cultivation to cover 220 hectares gradually. On-site facilities include an office building and a walnut processing facility, though the latter remains unequipped.
The fact that Konstantine Morgoshia has a favourable relationship with the government comes to light with one more fact.
In 2016, he contributed 91 thousand GEL to the “Patriots Alliance” through his wife and brother, Giorgi Morgoshia. Following an investigation by the State Audit Service, the court imposed a fine of 183 thousand GEL on Morgoshia for this donation, deeming it circumventing the law.
Morgoshia has expressed his reluctance to pay the fine, stating, “It’s not my responsibility to pay that fine. Lomjaria decided that I should pay the fine (referring to Nino Lomjaria, the head of the State Audit Service at that time), and she should do whatever she wants. I do not pay the fines imposed by Lomjaria.”
Konstantine Morgoshia has been listed in the debtor registry since November 2017 for failing to pay this fine. The National Bureau of Enforcement would typically seize his assets, but no properties are registered under his name in the public register.
