Gateway to Balkan property deals

Greece attracts foreign property investors but must cut red tape, says GVA Worldwide’s head

By Makis Theodoratos - Kathimerini

Greece is a market with significant investment opportunities in the property development sector and can be the springboard for foreign institutional investors to penetrate the Balkans further, according to Michael Corbett, the president and CEO of GVA Worldwide, which in the last couple of years has been involved with the Greek market through its partnership with business consultants Kantor.

Corbett explains in an interview with Kathimerini why GVA chose to get involved with Greece and calls for changes that will lead to a more flexible and more modern institutional framework: “In a period when institutional investors seek alternative solutions instead of established markets, and the emerging markets seem all the more attractive, Greece has to accelerate the licensing processes and the other time-consuming procedures that come before the realization of an investment,” he said.

Why did you decide to expand to the Greek market?

For an international real estate consultancy company Greece is an important European market due to the increasing influence of Greek investors as well as bankers. At the same time the sector of tourism covers a significant part of local investments, while a considerable number of international tourism chains want to expand to the Greek market.

In Greece we have been active since April 2005 through Kantor, a company with a strong presence both in the Greek market and in the UK, Belgium, Poland, Romania and Bulgaria. As GVA Kantor, the most recent projects we have participated in as consultants are the creation of a marina at Kammena Vourla and the development of a ski center at Tria-Pende Pigadia of Naoussa.

Is the Greek market overvalued?

Although many areas of the country have high property values, I generally do not think the market is overvalued. I would even say that compared to other markets, such as Romania, it is undervalued.

Which sectors do you spot the best investment prospects in?

For the time being, the Greek market has few quality commercial developments. Therefore I believe that the commercial property sector, and particularly that of major shopping centers, concentrates the interest of the international investment community. Today, although Athens has 5 million people, it only has one modern shopping center; I think it is absolutely natural that the market can support several other such developments, not only in the city center but also at the suburbs, and even on some islands.

In the next 12-18 months various types of commercial developments will enter the market. Could this lead to a bubble in the shopping center market?

I do not see any such risk, and if licensing procedures do speed up then the major Greek cities could even develop into business and commercial centers. Furthermore, discount centers at good spots with their own traditional architecture and style have a significant scope for development, as in many other European countries.

What should the government do to further encourage investor interest?

The main priority should be for a more responsible and flexible planning and for the simplification of licensing processes. To date the procedures required for a major property investment are very time-consuming, which discourages many investors, who can enter other markets much faster.

Which do you think are the pros and cons of the local real estate market?

The most important advantage is the improvement of infrastructures as a result of joining the eurozone and staging the Olympic Games, which have left the country with remarkable installations. On the other hand, Greece should not underestimate its values and history, and that its historic buildings and monuments influence foreign investors.

Is there a bubble in real estate?

There is no such thing as a bubble in the global real estate market. There will always be rise and drop spells. The only threat would be a depression in global economy, but that is unlikely.