Greece's Lamda Development hopes to secure all the necessary licences to start a huge development of luxury homes and offices at a disused airport site in Athens early next year, its top executive said on Thursday.
The former Elliniko airport, a sprawling site of disused runways, terminals and venues used for the Athens 2004 Olympics, has been abandoned for almost two decades.
Lamda plans to turn it into a complex of luxury homes, hotels, offices, a yachting marina and a casino at a total cost of 8 billion euros ($8.8 billion), aiming to attract thousands more tourists and investors to the Greek capital.
The project, part of a post-bailout agreement between Greece and its lenders, has faced several hurdles in recent years. But the newly elected Conservative government has expedited plans, including a tender for a casino resort at the site.
"I believe when we go in, and this I think will happen in January – in any case, early next year – all permitting will be completed. There will be no risk in terms of licensing," Lamda's Chief Executive Officer Odisseas Athanasiou told shareholders, as they met to vote on an equity issue of up to 650 million euros to fund part of the investment.
Not just a cash call
Lamda announced the cash call last month, saying China's Fosun and Arab funds had withdrawn interest in the project and it would undertake the development on its own due to the complexity and strict timetable.
Its biggest shareholder, the Latsis family, has committed to fully exercise its preemptive rights over the share sale and underwrite any unsubscribed shares.
Greece's biggest air carrier Aegean Airlines also said this week it would buy a 1.6 percent stake in Lamda and participate in the cash call.
"I am inviting you to take part not in a simple share capital increase but in the implementation of a project which we will all be proud of," Athanasiou said.
Lamda, which first outlined the investment plan in 2013, expects to spend about 2 billion euros in the first five years of an estimated 25-year construction phase to build two skyscrapers of offices and a hotel, about 800 residences and a park, Athanasiou said.
"Investment risk for the first five years is covered," he said, adding there had been strong foreign interest in the residences, of which there are eventually expected to be about 10,000.
Along with issuing new shares, Lamda expects to secure 400 million euros from property sales, about 800 million from banks loans and 150 million from issuing debt to reach that sum, he added.
Greece last week received two bids for the 1 billion euro casino resort within Hellenikon: one from US casino operator Mohegan Gaming & Entertainment partnered with Greek contractor GEK Terna, and another from Hard Rock International. [Reuters]