The reopening of Aman Sveti Stefan after a five-year closure restores one of Montenegro’s best-known tourism assets as the country seeks to increase visitor spending amid growing competition across the Adriatic and a decline in the average length of tourist stays.
Petar Golubović, director of Montenegro’s Centre for Tourism Research and Development, described the reopening as one of the most significant developments for the national tourism industry in the past decade, highlighting both the return of Sveti Stefan and the comeback of Aman, whose international clientele frequently selects destinations based on the brand’s global portfolio. Montenegro welcomed 2.73 million tourist arrivals and recorded 15.37 million overnight stays in 2025, with foreign visitors accounting for 95.8% of all overnight stays. Coastal destinations generated 92.6% of total nights. Although arrivals increased compared with 2024, total overnight stays declined, indicating shorter average visits and increasing the importance of higher spending per guest.
Luxury Segment Generates Broader Economic Activity
The Aman Sveti Stefan resort is positioned within Montenegro’s highest-value tourism segment, with accommodation rates exceeding €1,500 per night for many room categories and rising significantly higher for premium suites during the summer season. Guest spending extends beyond accommodation to restaurants, wellness facilities, private transfers, yacht charters, marinas, wine experiences, cultural excursions, events and personalised travel programmes, supporting businesses across Budva, Tivat, Kotor, the Bay of Kotor and other premium tourism destinations.
Settlement Ends Arbitration and Extends Lease
The reopening follows a settlement between the Government of Montenegro, leaseholder Adriatic Properties and other parties involved in proceedings before the London Court of International Arbitration. The resort had remained closed since 2021 following disputes over beach access and operational conditions required to preserve the level of privacy associated with the Aman brand.
The agreement resolves all claims and counterclaims, maintains the existing contractual framework and extends the lease by five years, matching the period during which the resort was unable to operate. The settlement also introduces a higher rental payment, grants the state the right to receive 10% of the lessee’s annual profit, establishes access arrangements for Sveti Stefan, Queen’s Beach and Miločer Beach, and includes measures intended to involve the local community and preserve the surrounding cultural landscape. Before the closure, annual rent was reported at approximately €1.9 million. The revised rental amount has not been disclosed publicly, making it difficult to quantify the guaranteed increase in state revenue.
Profit-Sharing Mechanism Adds New Revenue Source
In addition to rent, the state will receive 10% of the lessee’s annual profit. The financial return from this mechanism will depend on how profit is calculated, including the treatment of management fees, financing costs, depreciation, capital expenditure and transactions involving the Aman operator, affiliated companies, financiers and service providers. Unlike a share of revenue or operating cash flow, the profit-sharing arrangement requires transparent accounting, audit rights and consistent financial reporting to ensure predictable fiscal returns.
Illustrative operating assumptions suggest that a resort with approximately 40 to 60 premium accommodation units, average room rates of €1,500 and annual occupancy of 50% to 60% could generate between €11 million and €20 million in room revenue. Additional income from restaurants, spa services, events and other guest spending could increase total annual property revenue to between €16 million and €30 million, depending on the operating season and the year-round contribution of Villa Miločer.
With an estimated EBITDA margin of 25% to 35%, earnings before interest, tax, depreciation and amortisation could range between €4 million and €10 million, while net profit would be lower, particularly during the reopening period. Under such conditions, the state’s profit share could amount to several hundred thousand euros annually, alongside revenues generated through rent, VAT, tourist taxes, employment contributions, corporate taxes and visitor spending outside the resort.
Employment and Supply Chains Resume
During full operation, the complex previously supported approximately 180 to 300 direct jobs, including permanent and seasonal positions. Its supply chain extended to domestic transport companies, food and beverage producers, horticultural businesses, maintenance providers and hospitality suppliers, making the restoration of commercial relationships an important element of the reopening.
The sector continues to face labour shortages, particularly for multilingual hospitality staff, experienced chefs, wellness specialists, sommeliers, housekeeping personnel and managers familiar with international luxury service standards. Many skilled tourism workers from the region have relocated to Croatia, Slovenia, Austria, Germany and the cruise industry.
Villa Miločer Supports Year-Round Operations
The resort is returning in two operational segments. Villa Miločer, the former royal residence on the mainland, is intended to operate throughout the year, while the historic island of Sveti Stefan will continue to function seasonally. The structure enables activity outside the peak summer months through wellness programmes, private events, executive retreats, small conferences, cultural programmes and destination weddings.
Although Villa Miločer contains only eight suites, its year-round operation is expected to support demand for winter air services, premium transport, restaurants and other tourism services beyond the traditional summer season. Golubović also identified the wider Sveti Stefan–Miločer area as suitable for luxury cultural tourism and meetings, noting that the island has previously hosted exclusive weddings and private events and could accommodate selected concerts, exhibitions and international gatherings while preserving its heritage value and guest privacy.
Part of Montenegro’s Luxury Tourism Portfolio
The reopening strengthens Montenegro’s existing luxury tourism offering, which includes One&Only Portonovi, Regent Porto Montenegro, The Chedi Luštica Bay and premium hotels in Kotor and Perast. One&Only Portonovi reportedly generated approximately €24 million in revenue during 2024, illustrating the commercial contribution that a relatively limited number of luxury rooms can make. Unlike conventional hotel developments, Sveti Stefan combines restored stone houses, courtyards and historic streets on a fortified island connected to the mainland by a narrow isthmus, creating a tourism asset that cannot be replicated through new coastal construction.
Investment Dispute Resolution and Future Development
The reopening also follows the resolution of a dispute that had raised broader questions about investment security, concession stability, beach management and relations between private investors and public authorities. The settlement allows hotel operations to resume while maintaining the concession framework, increasing state revenue through higher rent and profit participation, and introducing public-access provisions.
Its long-term effectiveness will depend on consistent implementation by public authorities, the Municipality of Budva, coastal-zone management company Morsko Dobro, Adriatic Properties and the hotel operator, particularly regarding agreed access arrangements for beaches and public areas.
Janu Hotel Planned for Miločer
The agreement also provides for continuation of the hotel project at the former Kraljičina Plaža site under the Janu brand, Aman Group’s sister luxury hospitality concept. The project excludes additional residential apartments, maintaining its focus on hotel operations. Completion of the development will require architectural and landscaping measures addressing façades, rooflines, natural materials, lighting, traffic access, wastewater infrastructure, construction logistics and preservation of mature trees within Miločer Park.
Potential Expansion Into Northern Montenegro
Golubović also referred to the reported possibility of another Aman resort in Durmitor, creating a luxury tourism circuit linking the Adriatic coast with northern Montenegro. Such a project remains prospective but could connect Sveti Stefan, the Bay of Kotor, Durmitor National Park, Žabljak, Tara Canyon and northern Montenegro within a single premium travel itinerary. Development in Durmitor would require careful management of protected areas, water resources, wastewater infrastructure, visual impacts, road access and construction density.
Infrastructure Remains Critical
The wider economic impact of Aman’s return will depend on Montenegro’s transport and tourism infrastructure. Tivat Airport continues to experience heavy summer congestion and limited year-round capacity, while road congestion around Budva and the Bay of Kotor, wastewater infrastructure, coastal cleanliness, electricity supply and waste management continue to influence the overall visitor experience.
The government’s tourism strategy therefore requires stronger integration between premium hotels, airports, roads, marinas, environmental infrastructure and domestic suppliers. Food producers, transport operators, cultural institutions and other service providers will need to meet the standards expected by guests paying between €1,500 and €5,000 per night. Although Sveti Stefan will remain a relatively small contributor to national visitor numbers, its commercial importance lies in its pricing power, international reputation and ability to attract high-spending travellers, supporting Montenegro’s strategy of generating greater tourism value without relying solely on higher visitor volumes.
