In the early 1970s, Guccione invested around US $45 million in construction of Haludovo Palace Hotel, a luxury hotel resort in Malinska, (island Krk near Rijeka) on the Adriatic coast of Yugoslavia. He invested additional $500,000 in advertisement. Despite Yugoslavia being nominally a communist country, it encouraged foreign investments. The entire project was designed by Yugoslav architect Boris Magaš and realized through Brodokomerc, a local company. Prior to that, the project needed to be authorized through a so-called workers' council, a process which Guccione described as "ridiculously easy". The hotel was officially opened in 1972. Staff included around 50 Penthouse Pets, and the guests included the former Iraqi president Saddam Hussein. However, the hotel went bankrupt the very next year.