Nine out of every 10 foreign investors considering putting their money into the Greek nonperforming loans market are mostly interested in positioning themselves in the hotel sector. However, the stock of tourism properties offered by the Greek banks mainly concerns hotels outside the luxury category, according to market sources.
The biggest five-star units with big debt problems, which are the main attraction for potential investors, are mostly off the market, as they are hampered by complex legal issues, banking sources note.
Of the 9,800 indebted hotels in Greece, according to the latest statistics collected by PricewaterhouseCoopers and NAI Hellas, only 420 are in the five-star category while 1,340 are four-star units. Half of those are located on Crete and in the southern Aegean, though it is just a handful that will have to be sold via any type of procedure.
In contrast, hundreds of smaller and low-category (two- or three-star) hotels are on the market or set to be auctioned, but they hold less appeal for investors and definitely fetch lower prices, as they also require expenditure on renovation and market repositioning. With investors seeking annual capital returns of around 9 percent, according to NAI Hellas, transactions are few and far between.