Mixed bag on the property front

Housing market suffers downturn but prospects in commercial sector are favorable, says EBEA head

Kathimerini English Edition - By Stelios Bouras

As the global economic slowdown weighs on Greece's housing market, the commercial property sector is providing strong growth prospects for the coming years, Constantinos Michalos, the president of the Athens Chamber of Commerce (EBEA), said yesterday.

Michalos identified commercial retail stores, logistics facilities and the second-home market as being among the key growth drivers.

«Interest shown by Greek and foreign investors is expected to increase in coming years, demonstrating that the market is positively assessing the reforms,» said Michalos.

Recent reforms include the introduction of laws that facilitate public-private partnerships (PPP), the development of former Olympic Games facilities and the sale and leaseback of state property.

The construction of shopping malls has been attracting strong interest from foreign investors in recent years as Greece offers less space per capita in retail shopping malls than many of its European Union peers.

However, bureaucracy and a lack of city planning laws are often cited by foreign developers as being among the biggest investment obstacles.

«It is necessary to move ahead at a quick pace with the application of the new city planning laws so that everyone knows where and how they are investing,» said Michalos.

Turning to the housing market, the president of EBEA, the country's largest chamber of commerce, said the drop in demand seen in the housing market in the last few months is expected to continue.

The real estate market is an important area of investment for Greek households.

According to industry figures, the value of real estate investment represents 78 percent of total household portfolios, with 15 and 6 percent being placed in bank deposits and shares respectively.

Greece's real estate market accounts for about 23 to 25 percent of the country's annual gross domestic product. sbouras@ekathimerini.com