The lack of stability and predictability continues to pressure the Greek real estate market, however, the prospects for individual real estate categories remain optimistic, according to the main conclusions of the discussion of real estate market executives in the context of the 6th institutional management conference organized by the Association of Institutional Investors (AII).
Georgios Elekidis, Managing Director of Bain Capital (an investment fund operating in Greece with investments worth 1 billion euros, in real estate including several linked to red loans), Greece is characterized by legal inconsistency, such as that observed in the case of the New Building Regulation (NOK). As he also said, there are cases where an investor needs one or two years to obtain a permit. “There are problems in other countries too, but the situation is predictable,” he concluded.
According to Aristotelis Karytinos, CEO of Prodea Investments REIC and vice-chairman of the board of directors of the National Investment Fund (the moderator of the discussion), the institutional problems are many and significant. “We are the only country that is conducting studies on how to demolish…” he said.
Kostas Markazos, CEO of Premia REIC, said that with the recent institutional changes for REICs (Real Estate Investment Companies), their operating framework is satisfactory, but the tax regime that governs them has not improved. He noted that the return on the property acquired by Premia in Spain, a country in which the Greek company is recognized as a REIC, is higher than that on the hotel units it owns in Greece, due to the tax regime.
The CEO of Alpha Real Estate Services, Ioannis Ganos, spoke about the lack of institutional investors in the country, such as insurance funds that do not invest in real estate, as is the case in other countries, and stressed that the Greek real estate market still has a way to go, while it also needs to structure the appropriate attractive product. As he also said, Alpha Real Estate Services as a company has a plan for total investments of 1 billion euros, now it is somewhere in the middle, and the real estate categories that interest it are quality offices, retail and logistics. Alpha Bank subsidiary has also invested in Prodea, currently having approximately 10% of the share capital of REIC.
Despina Chamilaki, Managing Partner of Grivalia Management, agreed that there is no sufficient investment product. Referring to Grivalia (a subsidiary of Eurobank), she said that it has a real estate portfolio worth around 1.5 billion and has an investment plan of around 300 million euros. She noted that the aforementioned bank has not ruled out the possibility of becoming a REIC, but this is not something that is currently part of its immediate strategy.
Dimitris Papoulis, CEO of Trade Estates REIC, noted that he sees the course of the real estate market positively, while also referring to the acquisition of the Greek stock exchange by Euronext. According to him, the new landscape that is shaping up for the ASE, will benefit REICS because they will receive better analysis which will attract new investors.
