Colliers International's recent market research finds that despite the state of Greece's public finances, and, by association, its wider economy, the real estate market has continued to see some positive activity, with not everyone writing the country off.
One of the key planks of the Greek Government's recovery plan for the economy is for the country to focus on restructuring the tourism industry, moving away from budget summer-time focused tourism to more high-end year-round tourism, with bigger profit margins and more consistent revenues. The intention is to set a new geographic pattern of the tourism industry that upgrades the tourism product and concept of beautiful beachfront areas other than the Greek Islands. Areas such as Messinia and Argolida in Peloponnese along with large scale well planned tourism developments provide evidence of converting their economic basis in order to become top luxury travel destinations.
Following a recent visit, Colliers International's CEO for EMEA, Chris McLernon observed, “It is clear that despite daily jitters over Greece's sovereign debt problems, some investors continue to take the long view and are backing the ability of quality real estate products, with an international clientele, to rise above the trend in the wider economy. It is imperative that Greece continues to attract such investment, which will be vital if the country is to overcome its current troubles.”
Another sector where Colliers International believes Greece needs to maintain investment is in its logistics sector. In the World Bank's Logistics Performance Index 2010, Greece came in at 54 – a very poor score for a European country. If the country is to grow its logistics sector, it will need to attract the necessary infrastructure investment to make it attractive to global operators.
The potential development of a new logistics center in the Thriasio industrial district, combined with a proposed rail link to Piraeus Port, would be a good step towards moving Greece up the logistics rankings. Again, Colliers believes this is another example of where investment must be attracted against a background of harsh public spending cuts – the assistance of Greece's Eurozone partners in providing external, affordable, investment loans will be key.
Colliers did state, however, that key to Greece being able to attract investment in the coming years, would be a sharp improvement in the availability and transparency of real estate data. Large international investors require reliable property performance data in order to judge investment decisions credibly. Currently, a key factor, other than the current debt crisis, holding back such investment is a lack of such data in the Greek real estate market.