Greece expects Elliniko deal on Tuesday, unlocking bailout funds

Greece expects Elliniko deal on Tuesday, unlocking bailout funds

Greece said it would sign papers setting up the sale and long-term lease of the old Athens airport of Elliniko on Tuesday, a sale demanded by international lenders before they unlock loans needed to pay off debt to the International Monetary Fund and the European Central Bank.

Greece clinched a 915-million-euro ($1 billion) deal for the site of the disused airport in 2014. Under the terms of that deal, a consortium led by Lamda Development, a Greek developer, would own part of the property and get a 99-year lease to develop all of it.

But divisions among local communities and technical hurdles delayed the sale. A migrant crisis since the beginning of last year has also impeded efforts to conclude the deal.

“We expect within the day the signing of a memorandum of understanding between the privatization agency and investors,” government spokeswoman Olga Gerovasili told a regular briefing, referring to prime seafront property at the Elliniko complex.

The initial deal called for the Lamda-led consortium, which also included the Chinese diversified group Fosun, the Abu Dhabi-based real estate firm Al Maabar and other investors, to spend about 6 billion euros to turn the 445-acre property into a seaside town of hotels, residences and shops. About 50,000 jobs would be created over 10 years.

Greece should fulfill later this month another prerequisite for getting a sub-tranche of 7.5 billion euros in bailout loans, the transfer of a five percent stake in its telecoms operator OTE to the state privatization agency.

“There should be some actions on behalf of Deutsche Telekom, which are still pending,” Gerovasili said.

Deutsche Telekom owns a 40 percent stake in OTE and has a right of first refusal of any sale of a stake in the operator.

Gerovasili said the government had a November 16 deadline to conclude the Elliniko deal and that it would continue until then negotiations with investors to secure bigger and front-loaded investment.


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