Investment Portal of the Arctic Zone of the Russian Federation

Made in Apatity

A resident of the Arctic zone of the Russian Federation in the Murmansk Region has reorganised its tourism infrastructure

16.05.2023 // Tourism has always been a good driver for the development of regions and one of their revenue sources. This is especially true for the budgets of small cities such as Apatity in the Murmansk Region. The world's fifth largest city located above the Arctic Circle, with a population of around 50,000 people, offers a diverse range of tourism that appeals even to seasoned travellers.

The Khibiny Mountains are not far from Apatity, which means that hiking and skiing enthusiasts can enjoy beautiful views of the surrounding nature while hiking the trails, downhills and uphills regardless of the season.

These mountains can also be seen from the windows of the Izovela Hotel, which is a centre for medical tourism and spa treatment. The hotel's medical centre is equipped with the latest technology and offers a wide range of treatment and wellness treatments, including its own unique fast recovery programmes.

Realising the need to upgrade the existing infrastructure and expand it, Kristall LLC prepared an investment project, which was implemented in the Arctic Zone of the Russian Federation resident status. Under an agreement with the Far East Development Corporation (FEDC), the investor invested RUB 95 mn and took advantage of tax breaks, consultancy services and a land plot leased without bidding.

The hotel has built a complex of three modular eco-houses on a monolithic foundation for guests, renovated the existing room stock and upgraded medical and technical equipment.


'These houses provide very comfortable accommodation for 14 people. In addition, we have improved the surrounding area and created an open-air contemporary art park featuring various art objects, including sculptures,' said Olga Kharitonova, Director of Kristall LLC.


She noted the project is overseen by the Siyaniye Centre for Contemporary Art, created in Apatity in 2020 by Andrey Malakhov, a television journalist, producer, actor, philanthropist and collector of contemporary art. The centre is developing an art residency programme for artists, as well as educational and research activities. In winter, there is an art skating rink with an entertainment programme for adults and children, and in summer, the park hosts musical and educational events.


'There are always people who love and know art, including contemporary art, and those who are interested in it. All of them are our clients,' noted Olga Kharitonova.


The centre regularly opens permanent and temporary exhibitions of works by contemporary Russian and foreign artists for guests of the Izovela Hotel and Sanatorium, as well as holding creative classes and meetings with interesting people. The exhibition space features works by artists from the Andrey Malakhov collection that have earned international acclaim. There's also a sculpture by Scottish artist Philip Colbert called 'Lobster with Medusa Head,' made from Carrara marble, and a work by street artist Thierry Gett (Mr Brainwash) called 'Star Wars Reunion.'

In addition, the Izovela Hotel and Sanatorium, together with the Siyaniye Centre for Contemporary Art, launched the Made in Apatity project to support the local craftsmen and artisans to promote and sell their creative work.

Vladimir Gudkov, Director of the Department for Arctic Zone Investment Projects Support in FEDC, stresses that the AZRF regime allows businesses to enjoy significant tax benefits and administrative preferences.


'Thanks to its status as an Arctic Zone resident, the company has been granted a land plot on the lease, making it possible to begin expanding its room stock in a timely manner. An important support measure for investors who create new jobs is the payment of part of the costs of calculated insurance contributions from the subsidy. The final premium burden for large businesses is 7.5% and 3.25% for SMEs. This benefit gives AZRF residents the opportunity to offer higher wages to employees and provide other incentives to attract skilled staff,' said Vladimir Gudkov.


According to FEDC, the number of residents of the Arctic Zone of the Russian Federation has now exceeded 600. Investors have invested RUB 80.5 bn in projects and created 6,700 jobs.