Game changer for Athens property market inches ahead
Greece has initiated procedures regarding the construction of a 250 million euro development that will house nine government ministries in a project seen playing a key role in reshaping the Athens property market.
The plan involves turning a 38-acre site currently used by ammunitions producer PYRKAL in Hymettus, eastern Athens, into an area that will accommodate state offices currently scattered in 37 buildings across the Greek capital.
After the project was initially announced in April, the government recently appointed Deloitte as adviser to the project scheduled to go ahead as a public private partnership.
The benefits from the development are numerous. Savings will be created for the state which hands over about 33 million euros in rent every year for existing facilities, while creating an investment push with broader benefits reaching one billion euros over the next 7 to 8 years.
Construction of the project, dubbed ‘Government Park’, has been scheduled to start in the 2023 after the necessary permits are issued in 2022, say government officials.
An outline that looks optimistic. Experiences such as the construction of the Ellinikon project at Athens’ former international airport show that projects of this type rarely stick to initial time frames.
Valued at eight billion euros, the Ellinikon project is a much larger, more complex deal than the Government Park though there are a number of issues the two have in common.
Just like Ellinikon, there is strong opposition to the plan.
A number of local residents oppose the project, meaning that time consuming legal challenges are likely. Residents are calling for the Pyrkal site to be turned exclusively into a park area as promised by government officials in the past.
There is also opposition to the development coming from residents in others parts of Athens that will see government ministries being taken from their neighborhood in order to be relocated to Hymettus. These residents fear that the empty buildings left behind will be abandoned, creating ghetto-like conditions.
Also, the project’s success will depend on a succession of governments, not just the ruling conservatives, given the time needed for its completion.
Each administration will need to support it and this looks unlikely, as things stand right now.
The initial reaction to the project from main opposition party Syriza has been negative with the group saying that the relocation of Pyrkal will harm Greece’s defense industry.
This opposition may wither away if the left wing party takes power and the project is still in progress, though support for the Government Park could still be shaky.