Cyprus Property: What more can a Minister do?

03 March, 2017 | Posted By: Antonis Loizou

By Antonis Loizou F.R.I.C.S. - Antonis Loizou & Associates Ltd - Real Estate & Project Managers

During a recent visit to the Ayia Napa-Sotira-Paralimni area, I was surprised by the construction boom under way. The facts are such that the area is the most competitive as regards building development.


I counted 15 hotels that are being upgraded or refurbished, new commercial units, of course the Ayia Napa marina and the new hotel in Sotira, near Ayia Thekla, which will raise the region’s capacity by 2,000 beds. At the same time, infrastructure projects have been announced for Ayia Napa and Paralimni with coastal paths, jetties, small fishing shelters, which will transform the area within the next three years to the “Mykonos of Cyprus”, with great benefits to the area and the island’s economy in general.
Already, demand is growing for the Ayia Napa Marina villas and apartments that are going for 7,000-8,000 euros a square metre, driven by its main investor Sawiris’ ability to attract buyers. These high-income investors, mostly foreign, will also contribute to the local economies. Even the oddly named ‘Open Park’ saw a good number of visitors when I was there. But praise is also due to the Cypriot banks and financiers who have finally realised that the future is in tourism (as recommended by the Troika) and are now encouraging development.
What, then, can a Minister achieve to the benefit of the economy?
This sector of housing development is the sole responsibility of the Interior Minister who can make or break a decision. I therefore take my hat off to Mr Hasikos, and by extension the entire Cabinet, for achieving the following:
• The incentives with the building coefficients were the best solution and proof that this factor helps development and makes these investments sustainable.
• The relaxations as part of the “Anastasiades incentives” were an added boost to the large projects.
• The negative problems have been put aside and the state is on track towards economic recovery.
• The issues of the gold course and Paralimni marina are unfortunately still on hold. I may not be an expert, but I believe the Ayia Napa-Paralimni golf course could fall under the category of “infrastructure projects” and thus secure relevant grants. If this project is budgeted to cost EUR 5 mln, I’m sure the right solution can be found whereby the state will put up the land, management to be given to an international partner and thus attract investors. As I have suggested in the past, there needs to be a “super fund” which, in addition to the various incentives, can contribute about EUR 50-100/sq.m. With the state providing the land, revenue will soon be pouring in that will make such projects almost self-sufficient.
I therefore urge the Interior Minister to continue with his progressive thoughts and keep up the incentives, while the Cyprus Chamber of Commerce should become more assertive by supporting such projects.
Fortunately, we now have the Town Planning Dept. that seems to have overcome the trivialities of the past, while the Land Surveys service still has a long way to go.
The future of the Famagusta area is bright with property values rising, with a positive impact on landowners, developers and hoteliers. What remains is the upgrading of various infrastructure projects which are still in a poor state.
Maintaining the investment-for-citizenship scheme for another year should b considered, despite the warnings from the EU, because this measure accounts for the majority of foreign investors, as has been suggested for the Larnaca port.