ECONOMY

Private funds for relocating ministries

With money scarce and the need to control expenses becoming more important, the government appears ready to fund its planned moving of several ministries away from the center of Athens with private funds. Under the previous economy minister, Yiannos Papantoniou, a plan had been drawn up to move several ministries, including the Labor, Education and Environment ministries, away from the city center in order, among other things, to help ease congestion. The budget for such a move had been set at 1 billion euros and the government had even contracted a loan with European Investment Bank (EIB), the European Union’s long-term credit institution, for 480 million euros. Another 300 million was to be spent from the Public Investment Program and the rest were to be found from earnings by the Public Real Estate Company (KED). Current Economy Minister Nikos Christodoulakis, has decided that the State cannot afford to spend these sums, or to take any money from the agreed loan. Instead, the government is going to rely on private sector companies to build the installations and lease them for a period of at least 20 years, to the State. The plan would then provide for the State to acquire the properties, if it can afford to do so. KED is responsible for overseeing the whole project and hiring the financial advisor who will try to attract the private capital. Six consortiums, made up of banks, consultancies and specialized law firms, have already expressed interest. They are: JP Morgan, National Bank, Alpha Finance and Norton Rose; Bank of America, Deloitte and Touche, Allen and Overy, American Appraisal and M & P Bernitsas law firm; HypoVereinsbank, Investment Bank, Lambert Smith Hampton; Deutsche Bank, EFG Telesis, Kantor, Sayias and Partners law office, Central Assessors & Property Consultants Ltd and FDP Savills; KPMG, Piraeus Finance, Piraeus Redfin, Diadikassia SA, Klegal and GVA; Ernst & Young (Hellas), Potamitis, Iliadis law firm, SGI-Trademco, Kion construction firm, Chesterton International and Miller Hughes Associates Ltd. It is already known that the Labor Ministry will relocate to the present site of the Olympic Village (its commercial section) after the 2004 Athens Olympics. This could be built by the Public Housing Organization, as the bids by private companies to build and operate the property were deemed too low. The Education Ministry will relocate to a media village at Maroussi, next to Irini metro station.