Elliniko development will require investment of 10 bln euros

By Vangelis Mandravelis

Developing the plot of the old airport at Elliniko, southern Athens, will require an investment of about 10 billion euros, which places the ambitious privatization project among the biggest in the broader Mediterranean region for the next few years. Direct investment will reach 6-7 billion while secondary investment for networks, infrastructure, common spaces and so on will require another 3 billion euros, according to Odysseas Athanasiou, chief executive of, Lamda Development, one of the companies short-listed for the tender.

Athanasiou stated the figures as he addressed the Global Capital Forum in Athens on Tuesday, in the knowledge that the Greek construction company is the front runner to take over the project come the decisive phase of the tender. Construction and real estate experts say Athens-listed Lamda is the favorite to win, which, if true, gives the construction firm CEO’s statement additional weight. The implementation of the project is expected to create some 15,000 jobs, while after its completion it will employ up to 50,000 people.

Athanasiou added that the state will have billions of euros in tax revenues from the utilization of Elliniko in the long term, to say nothing of the impact on tourism, which will see 1 million extra visitors added to the current 3 million tourists who come to Athens every year.

Besides Lamda, the other short-listed bidders are Britain’s London & Regional Properties and Israel’s Elbit. The deadline for the submission of binding offers is February 27, but given the great size of the investment required, the initial prices offered will likely be rather low.

Lamda will not be able to realize the investment alone and will need the assistance of foreign partners. The Greek firm has made no secret of its interest mainly in shopping and conference centers that may well be included in the investment. Hence it has recently boosted contacts with foreign investment funds that have already become involved in the local market with other projects in order to secure the necessary amount of funds for the realization of the investment.

All bidders will be invited to submit a full portfolio illustrating their financial and technical adequacy for the management of such a big project. They will also have to submit a strategic plan for the operation of the plot that must be compatible with the specified land usage. Only if these conditions are fulfilled will state privatization fund TAIPED proceed to the opening of their offers.

According to the sale contract, the state will receive a predetermined share of the investor’s earnings, but only if the latter has secured a specific yield on their investment.