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The Greek Real Estate Market in May

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As the global market is waiting for the dust to settle from the Covid-19 epidemic, so does the Greek. May has been a month of a few careful transactions, regulatory step-ins and state aid to help the market stand on its feet until the picture of what has happened is clearer.

According to the government, Greece’s economic slump was not as bad as expected. The GDP decreased by 0.9 percent for the first quarter of 2020. The data also showed that the gross domestic product shrank 1.6 percent in the first quarter, at a faster pace compared to a 0.7 percent contraction in October-to-December.

Meanwhile, Greece’s luxury holiday home market seems to be rising. The country has appeared on the radars of individuals on the Forbes lists of the wealthiest people, while the pandemic was ongoing.

On another note, the prices for the residential properties have risen by 6,9% during the first quarter of 2020. The data has been released by the Bank of Greece. The impact of the pandemic is not shown in this data as it concerns the period prior to the restrictive measures to tackle Covid-19.

At the commercial market, the state push for rent reductions more than 30% has seen resistance from the RE owner association and the funds that have invested in the Greek market. Nevertheless, there have already been reductions in rental prices by large groups such as Lamda Development that has reduced the rent in its malls by 40% in March and 70% in April and May. REDS has lowered the rents at Smart Park by 40% during the months that the stores were closed and Athens Metro Mall reduced the rental prices by 65%. The retailers are asking for more permanent reductions and request new contracts.

More specifically, in May:

Offices

Office buildings do not seem to lose any value due to the pandemic, as investors keep on purchasing such properties. In May, Trastor REIC announced the completion of the acquisition of a property located at 57 Agiou Konstantinou Street in Maroussi, Athens. It is a modern office building with a total area of 3,716 sq.m., which consists of office spaces that extend to five levels and two underground parking spaces. The acquisition price amounted to 6,350,000 Euros.

Trastor also acquired two office buildings located at Amarousiou – Chalandriou Str. in Maroussi. More specifically, the company acquired a stand-alone office building with a total surface area of 21,412 sq.m. that consists of office areas and underground ancillary and parking areas. The property is located at 16, Amarousiou-Chalandriou Str. The acquisition price for this property was €26.8m. Additionally, the Company acquired a stand-alone office building with a total surface area of 4,185 sq.m. that consists of office areas and underground ancillary and parking areas located at 29, Amarousiou-Chalandriou Str. The acquisition price for this property is €7.2m.

Meanwhile, the Greek start-up company Workable announced that it is reducing its expenses by reducing their staff by 9% and severely cutting off operating expenses, including rent expenses in Athens, Boston and London.

Hospitality:

Despite the significant slump in revenues in the hospitality sector, there have been announcements concerning Hotels and Resorts.

The Council of State approved a hotel investment of €50.85 m on Mykonos island. The five-star hotel investment with the code name “The Mykonos Project” belongs to the consortium AGC Equity Partners through the company Blue Iris SA. The company made its first investment in Greece in 2013 when it bought Asteras Hotel for €600 m.

Meanwhile, the company YHE Hotel Establishment has been given the green light by the Municipality of Athens to proceed with the conversion of the former YMCA building, at the junction of Akadimias 36 and Omirou 28 streets in Athens, into a hotel. 

Land plot

The Greek Public Properties Company (ETAD SA) announced the signing of the contract with FULGOR SA Hellenic Cable Industry for the sale of a property at Loutraki, in Corinthia. The property borders the existing operating industrial unit of FULGOR SA, which aims to expand the production, sales, and to increase employment in the region.

In Cyprus

The state-owned Cyprus Asset Management Company, KEDIPES, announced the sale of 49% of the share capital of Altamira Asset Management (Cyprus), implementing the commitments made by the Republic of Cyprus to the European Commission. The sale price was agreed at € 4.5 million.

On another note, Hellenic Bank sold the most expensive house of its RE portfolio The property is a large mansion on the municipal boundaries of Lakatamia, and it was sold to foreign investors for € 3,070,000. It consists of a luxury villa in a 14,542 sqm land plot.

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