Albania, real estate development

In Albania, real estate development rests on three layers:
territorial and urban planning documents,
the legal status of the property (ownership, cadastre, development/building rights),
and a set of permits and approvals that depend on the type and size of the project.planifikimi.gov+1

The main framework is Law no. 107/2014 “On Territory Planning and Development”, which regulates planning documents and sets the rules and procedures for development and construction permits. Under this law, every construction project on the territory of the Republic of Albania requires a development and/or construction permit, except for a few precisely defined minor works. An important innovation is the principle of tacit approval: for certain categories of permits, if the competent authority does not issue a decision within the legal deadline, a complete and proper application is deemed approved, with exceptions for high‑risk projects and those decided by the National Territorial Council (KKT).

1. Planning documents – where development is possible

Planning in Albania is hierarchical and covers the whole territory:

• national spatial documents define strategic development, corridors, protected areas and sector policies;

• general local plans and master plans at municipal level set land use, development parameters, infrastructure networks and basic rules for urban and rural areas;

• detailed plans and partial urban studies translate this framework into concrete rules for specific zones – parcel layout, building footprint, heights, density, traffic, public spaces and utilities.

For a serious project, the first step is always a planning check:
which planning documents apply to the plot;
whether the land is designated as building land and for which use (residential, tourism, commercial, mixed‑use, industrial);
what the density and height parameters are;
and whether special regimes apply to the coast, cultural heritage or environmental protection. Without alignment with the applicable plans, a project is not feasible because permits must always follow the planning framework.

2. Legal status and development right

In addition to planning, the legal and cadastral status of the land must be clear. A standard due diligence includes:
checking ownership, mortgages and other encumbrances;
reviewing cadastral maps and data (boundaries, land category, any discrepancies);
identifying restitution and privatisation issues resulting from the transition and earlier land reforms;
and clarifying the development right, which Law 107/2014 defines as the legal possibility to develop a parcel within the limits imposed by planning documents and the development permit.

For foreign investors it is particularly important to confirm that the land is properly registered, free of conflicting claims, and that there are no illegal structures on the site that would need to be legalised or demolished before or during the project.

3. Development and construction permits

Under Law 107/2014, a distinction is made between:
development permits, which define the development conditions for a plot or wider area (use, maximum volumes, infrastructure obligations) and serve as the basis for the later construction permit;
construction permits, which authorise specific works in line with the development conditions and planning documents.

Permits are issued through the electronic e‑permits system, and competences are shared between municipalities and the National Territorial Council (KKT) for larger and strategic projects, including a significant number of hotel and resort schemes. The law provides clear deadlines and documentation requirements; for standard projects the tacit‑approval rule applies, while permits for high‑risk and development‑critical projects must be explicitly transparent.

4. Typical process for a hotel or mixed‑use project

The process can be described as follows:

• Pre‑feasibility and planning check
  Analysis of plans, zoning, infrastructure capacity and access; first comparison of the intended programme (number of rooms, floor area, height, supporting functions) with the permitted parameters.

• Legal due diligence and transaction structure
  Title and cadastral checks, review of encumbrances, identification of unresolved restitution claims or informal buildings, and definition of the structure (asset deal vs. share deal, SPV, joint‑venture with a local partner).

• Dialogue with authorities
  For larger or sensitive projects, a preliminary dialogue with the municipality or KKT is recommended to confirm political and administrative support, understand expectations on public infrastructure and clarify whether a new or amended detailed plan is required.

• Concept and technical design
  Preparation of a concept that respects planning parameters, followed by a more detailed technical design aligned with Albanian rules on construction, structure, fire safety and environment, involving specialist consultants.

• Application for development and construction permits
  Submission through the e‑permits system with full documentation, proof of building rights, technical reports and, where required, environmental‑impact studies. The competent authority (municipality or KKT) reviews the file, requests additions and then approves or rejects the permit. For standard projects, statutory deadlines and tacit approval are key for timing; for KKT‑level hotel and resort projects, an explicit decision is required.

• Construction and supervision
  Once the permit becomes effective, construction starts under the supervision of licensed engineers, with strict compliance with permit conditions and technical documentation.

• Use permit and registration
  After completion, a use permit (Leja e Përdorimit) is obtained, confirming that the building is safe and fit for use, and the actual status is registered in cadastral and property records – a prerequisite for sale, mortgage or refinancing.

5. Specifics for hotels and tourism

Strong tourism growth and an attractive coastline have led to a wave of hotel and resort permits, especially in the Durres–Tirana area and along the southern Riviera, where many projects fall under KKT’s competence. For hotels and tourism projects, in addition to classic construction issues, it is essential to address:
the typology and classification of accommodation;
standards for rooms, common areas, F&B, wellness and conference facilities;
licensing and permits for tourism and hospitality activities under the Tourism Law and its recent amendments on categorisation and registration of apartments and villas used for short‑term rentals.

If these elements are not planned from the outset, there is a real risk of delays, blocked use permits or the inability to register the property as a commercial hotel asset.