The new “green city” of Hellinikon is born

With sales in the residential areas running, having reached almost 100% for the beachfront residences and 65% for the apartments that went on the market at the end of 2023, and the individual developments within the area gradually locking in, the pieces of the puzzle of the Hellenikon mega investment are now coming together at an accelerated pace.

The accelerating pace of the Greek Greenskin’s megalithic project is gradually accelerating.
Passers-by from Poseidon Avenue, Vouliagmenis Avenue and the side roads cannot fail to notice the more than 30 cranes working daily at the construction site, with work intensifying as the milestones for the delivery of the first phase of the works approach, starting this year and gradually up to 2027. Indicatively, on the flood protection and infrastructure works, work on the Trachona stream within the airport site is now at 91% and will be completed this year, while that on the airport stream next year, such as the new sports facilities now under construction on the site is expected to be delivered to the public in 2025.

In 2026, the largest infrastructure project of the first phase of Hellenikon is expected to be completed, the undergrounding of the avenue. Poseidonos, while in the same year the houses of the much-discussed Residential Tower and the low-rise coastal front complexes will be completed, as will the Riviera Galleria, commercial spaces for which just last week the contract for their construction was signed between the developer, LAMDA Development and METKA of the METLEN group.

The big deal

Last week, however, brought a second resounding deal for the project with one of the most powerful business names, such as that of shipowner George Prokopiou, who is known to be one of the biggest real estate investors in Greece and abroad, with top properties around the world. His portfolio is rumoured to exceed 2,000 properties in prime locations, from the Greek capital, the city center and the Athenian Riviera to the British capital and New York, as well as in popular tourist destinations, whether it’s the Italian Riviera, or even Mykonos or the more stately and quiet Hydra.

LAMDA Development and the Prokopiou family have announced a strategic partnership between them, which includes two parts: the agreement to sell over 3.5 million treasury shares (2%) worth €25 million (€7.10/share) of LAMDA Development to a company of Mr. Prokopiou’s family interests, through a pre-arranged transaction, and in a broader context the plan for developments totalling 86,000 sq.m. in terms of buildable area within the former airport site.

According to the plan, four building blocks will pass on the Prokopiou side in the area near the “Hard Rock Hotel & Casino Athens” (the Integrated Resort Complex with Casino -IRC- developed by the GEK TERNA – Hard Rock groups and currently in the foundation stage) and the Glyfada Golf Course.
From the Prokopiou Group’s point of view, its strategic involvement in the Hellenikon project reflects the vote of confidence it gives to the prospect of mega urban redevelopment, especially since the family has in its portfolio a number of prime properties on the Athenian Riviera. Where the Prokopiou side has relatively recently entered into a partnership with the Konstantakopoulos and Kokkalis groups for the redevelopment project of Voula’s 2nd Coast (with a completion horizon from 2025 onwards) through the joint investment scheme of “Athens Beach Club“, following the concession tender of the Municipality of Vari-Voulas-Vouliagmeni for the redevelopment of part of the coastal front.

Educational institutions

The new developments, in addition to those for residential and office space, will include the creation of an educational institution, i.e. a school with an international curriculum, which is an interesting aspect of the investment.

In the large urban redevelopment of The Hellenikon anyway, the masterplan envisages the hosting of schools with a hybrid curriculum, national and international (International Baccalaureate – IB) with grades from pre-school to high school and with a number of students of 1,500-1,700 per school. In this context, it was already announced a month ago the finalization of the agreement with Kostea Gitona Educational Institutions S.A. – CGS that will undertake the development and operation of an educational institution for Primary and Secondary Education with a National and International Accredited Curriculum. LAMDA Development and CGS have signed a Memorandum of Understanding, for an initial term of 30 years with the option to extend for an additional 30 years, with the long-term lease rent to be determined annually based on the turnover achieved in each calendar year, and CGS at The Hellenikon is expected to open in September 2027.

Similarly, the Prokopiou side’s rationale is based on the creation of another iconic private school with an international curriculum covering an important part of the market for Greeks and also due to the significant increase in foreign residents of the southern suburbs in recent years. In addition, the direct agreement with LAMDA Development comes after Athens College’s decision last February not to proceed with its plan to establish a school within the Hellenikon site, a plan that George Prokopiou, a board member of the Hellenic American Educational Foundation, had supported. Hence, the shipowner’s side is now proceeding on a different basis and with a more comprehensive investment initiative to develop 220 acres within the former Hellenikon airport site, which will include everything from educational uses to offices and residences.

And a university

It should be noted that, in addition to primary and secondary education, in higher education, based on the masterplan, The Hellenikon is also expected to house the development of an educational ecosystem with modern facilities combined with an Innovation Hub designed to attract Greek and foreign students, digital nomads and young professionals, with a projection of 5,000 to 10,000 students per year, Greeks and foreigners alike.

In this context, already the staff of LAMDA is reportedly making contacts, without finalizing the outcome yet, with a foreign institution for the concession of land for the establishment of a non-state university, for over 20,000 sq.m. within the mega project that will involve a full campus, classrooms, laboratories etc.etc.The same sources say that in case the agreement is finalized, it is very likely that the announcements will be made by the fall and a standalone project of student houses within the land will proceed accordingly, either autonomously, by LAMDA Development itself, or even in collaboration with a third party partner.

Interest (and) in this part of Higher Education has reportedly been expressed by the Prokopiou side -which has also taken ownership of the Skaramanga Shipyards-, having repeatedly stressed the need to pay renewed attention to Greek shipbuilding education and the blue economy, with any planning to come at the next stage.

Collaborations

From LAMDA’s point of view, the agreement with the Prokopiou family is part of the overall framework of the group’s business plan and its pursuit of individual collaborations with the Greek project in mind, at the shareholding level or in the development part of the project, with the aim of reducing risk, given the project’s large capital needs.

In this context, in recent years, Voxcove Holdings (10%, at the end of 2017 as a joint investment of the P. Germanos and Katsos family groups), Brevan Howard & Partners (6.4%), EBRD (1.8%), Aegean Airlines (1.7%), etc.

When it comes to individual developments within the area, apart from the mega investment of “Hard Rock Hotel & Casino Athens”, the group has entered into joint ventures with TEMES S.A. (“Costa Navarino“, formerly “Hilton” Athens) for two luxury hotels and “branded” residences in an investment of over half a billion euros. euros, and Brook Lane Capital for the Mixed-Use Tower, also a €500 million investment with a luxury hotel and branded residences and a “resounding” architectural name to be announced soon. In fact, for the new Mixed-Use Tower, some 150 metres high and about 40 storeys high with a delivery horizon of 2028, it is reported that the residences will start coming on the market from the end of this year onwards.

On the contrary, sales, with great interest from abroad and prices that have reportedly climbed even above 25,000 euros per sq m, are underway at the luxury complex of 20 residences that listed Real Estate Investment Orilina Properties AEEAP has already started to develop.
The first homes will be delivered to owners in 2026, and following the agreement with LAMDA, Orilina will also develop the private club, in an investment that, including the homes, will exceed €80 million. Reports suggest that the listed AIF, with Brevan Howard as a major shareholder, has interest in other projects – residential mainly – within the former airport site.

The Health Sector

For its part, LAMDA has signed agreements with the Fourlis group for the commercial park to be developed by the latter for more than €70 million, having also a broader framework of cooperation with the group, while the most recent agreements include one in the healthcare sector for the “Healthcare Park” in Hellenikon with a completion horizon of 2027. The consortium of Athens Medical Group (70%), Biomedical (30%) has signed a memorandum of strategic cooperation with LAMDA Group for a modern medical center, over 6,000 sqm, in a privileged and easily accessible location next to the commercial center of Hellenikon .

It should be noted that LAMDA is accelerating at this juncture and the already announced plan for the sales of individual plots within the area and in this context new agreements with emphasis on residential uses are coming immediately. The group has already initiated and intends to finalize, possibly within the next month, the agreements for five plots with a buildable area of 50,000 sqm at a price of 2,000- 2,100 per sqm with interested big names in the market, including Brook Lane Capital, Prodea Investments AEEAP etc. From the aforementioned land, revenues are estimated at €100 million, while new land is expected to be put on the market soon, so that by the end of the year, a total of €200 million in revenues will have been secured. The aim of these sales is also in this case to reduce the investment risk for the project, but also to secure resources to cover the increased future financing needs of the project.

Residential sales

It should be noted that based on the management’s own words and precisely because of the positive individual performance for the project, including the good progress of pre-sales of the residential units, bank borrowing will not be required this year either, despite the existence of an approved credit line (except for the malls which are a separate component).

Recall that the total investment of the first phase of the Hellenikon projects up to 2026 amounts to €2.1 billion, with LAMDA having recorded over €670 million. EUR 670 million in cash receipts from property sales by the end of May 2024, while total capital expenditure on buildings and infrastructure projects from the start of the project until the second quarter of 2024 is estimated to exceed EUR 400 million.

Specifically with regard to residential sales, sales have already proceeded for more than 40% of the planned residential units in phase 1 – 1,121 in total with receipts of more than €570 million. Of the 1,121 residential units of the first phase, the houses on the coastal front account for 315 in total, of which more than 300 houses have already been closed with relevant advances and agreements.

For the large Little Athens neighborhood, of the 342 apartments that have come to market to date (from the end of 2023 onwards), agreements have been concluded with reservations from interested buyers for close to 210 apartments or about 65%, while additional homes are expected to come to market gradually in the next period, reportedly towards the end of this year. The majority of the beachfront homes have been purchased by Greeks with a very small percentage of foreigners at 5%-10%. But for the new Little Athens residential neighbourhood the percentage of foreigners who have signed booking agreements has risen to 30%, following the international campaign to promote the project which started in March and is now being stepped up.

Infrastructure works

At the same time, infrastructure works within the site are also progressing. In Elliniko’s largest infrastructure project, the undergrounding of the Poseidon Elevator two years after the start of work in May 2022, more than 80% of the excavation, 60% of the wall concreting, 75% of the base slab concreting has already been completed, while work on the construction of the tunnel roof is underway. The undergrounding is expected to be completed in 2026, with one of the most modern tunnels in Europe, where the 1.5km-long underground route will extend from Alimos beach to the marina of Agios Kosmas, with three lanes in each direction, the removal of traffic lights and the aim to relieve traffic congestion on the coastal front.

For the flood protection works, particularly the Trachona stream, 95% of the excavation and 65% of the concrete work has been completed, while for the airport stream (or Evrialis as it was formerly known), the delineation work is in full swing. Work on the Trachona stream, within the airport site, will be completed in 2024, while work on the airport stream will be completed in 2025.

Sports Center

For the Hellenikon sports center – The Hellenikon Sports Park – with football pitches, open track, wet track, basketball and tennis courts, the aim is to become “an international reference point for sport, serving athletes, clubs, associations and federations from all over the world” from 2025 onwards, when the new sports facilities are due to be delivered to the public. So far, foundation work has been completed for the athletes’ dormitory building and the new administration building for the football facility, while work is in full swing on the foundation for the athletics grandstand area and earthworks to shape the entire sports center.

Last week, signatures were put in place with METKA for Riviera Galleria, the 23,000 sqm of commercial space signed by leading, internationally renowned Japanese architect Kengo Kuma (Kengo Kuma and Associates) and designed in collaboration with Greek design firm BETAPLAN, with a completion date of 2026.
For “The Hellenikon Mall”, one of the largest shopping complexes in Southern Europe with a total area of 150,000 sqm and a completion horizon of 2027, excavations 8 meters deep have already been done on a 122-acre plot of land, with the numbers staggering: This is one of the largest foundations in terms of area, with 1.3 million cubic meters of excavation equivalent to 4 times the size of the Panathinaikos Stadium, then including columns with a total length of 30 kilometers, or else covering the distance from Athens to… Elefsina.

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