The position that in order for Cyprus to become a maritime destination and at the same time to upgrade its tourist product, all five marinas should be built, as the study conducted in 1996 showed, expresses the CEO of Makronisos Marina Ltd Stavros Karamontanis.
In an interview with StockWatch, Mr. Karamontanis talks about Makronisos' ambitious work and the multifaceted positive effects it is expected to have on the wider region. He states that by the end of the year some of the infrastructure projects will be ready and by 2021, the residential part.
Analyzing the profile of buyers, who have so far bought 85% of the apartments in the two towers and villas, he points out that, although it has sold apartments and villas as part of the naturalization program, the marina is not based on passport sales.
Mr. Karamontanis also deals with the authorities because, as he claims, the process that follows for the approval of new investors who will bring their money to Cyprus is often too strict, to the point that it causes dissatisfaction among investors as a result of which they leave Cyprus for other competing destinations.
He describes the Ayia Napa marina project as an ornament for the province of Famagusta, while he estimates that the residential development of the project will raise the prices of real estate in the area for the benefit of existing property buyers.
Referring to the progress of the project, he expressed optimism that they will achieve the goal they have set for the completion of the project within 2021. He also said that the first phase of the project concerning the construction of the marina and all necessary support infrastructure will be delivered by the end of 2019 .
Q: How is the marina project going? How are the construction projects going? Will the 2021 goal be achieved?
A: We are moving forward according to the goal we have set, so I estimate that based on current data, the project will be completed in 2021.
Within our vision I believe is the completion of the first phase, which is called marina and focuses on the marine part of the project. It includes all the construction projects at sea along with all the necessary infrastructure required for the marina to work.
I believe that we are moving forward on the basis of the schedule, so I hope that by the end of the year it will be operational.
With the completion of the first phase we will be able to accept the first boats. All the infrastructure will be ready to provide the necessary services such as water, electricity, internet, to the boats that will be moored in the marina. All support services will also be ready as well as the government building which will house the port police, customs, and the Aliens and Immigration Service.
We also estimate that a large part of the commercial development will be ready by the end of 2019 with a time horizon in March 2020 to complete the entire commercial area.
At the same time, however, the construction works will continue, ie the two towers and the rest of the residential development, but always with the safety of the employees, visitors and tenants anchored in our marina in mind. The part of the commercial development based on the agreement with the state is only for rent.
It is also recalled that development is the result of a public-private partnership. So we are partners with the public and I want to emphasize this so that the messages and the friends in the various government departments get it. The difference, however, is that the state, in order to avoid the financial burden of the investment, transferred the financial risk to us, providing us with the management of the project for 50 years with the possibility for the investor if he wishes to apply for a contract renewal.
The Housing Development Agreement provides for management for 125 years.
Q: What does the marina mean for the tourist development of Ayia Napa?
A: First, a jewel project is created for the province of Famagusta. It is the first project of this scope which combines economic and tourism development. It will contribute to the further upgrade of the area and the upgrade of the tourist product.
Other high-level developments are already being built next to the marina.
Q: In Cyprus in the coming years we will have five marinas if all applications are finally licensed. How many marinas can be sustainable in Cyprus?
A: According to a study conducted in 1996, five marinas can be created in Cyprus.
Without many marinas we can not create maritime tourism nor to upgrade the tourist product of Cyprus.
If we put things in order of priority, I believe that the most important marina that must be implemented is that of Paphos.
Because sailors when traveling are not like cars that a driver can stop at any time where he wants. At sea you do not have this luxury. On the other hand the distances are long and the speed at which a sailor covers these distances is not like that of a car. A sailboat to go from Larnaca to Ayia Napa which is about 27 nautical miles takes six hours, so in maritime tourism there must be a port for safety but also for psychological reasons. The boat will have to catch a port, as we say.
Paphos is the entry point from the west side of the island, for one to enter and then leave and go on vacation to the Greek islands, the southern coast of Turkey, Egypt and other countries.
So we see how important the marina of Paphos is, as well as the marina on the east side. That is, our marina or that of Paralimni which will serve the eastern Mediterranean.
Then we have Limassol which works and is also very important.
Unfortunately, the marinas of Paphos and Larnaca have so far run into various bureaucratic problems or problems related to the agreement with the potential investors.
So the marinas are considered complementary for us and must be built if we want Cyprus to become a maritime destination and attract quality tourism. Then it is up to each marina individually to offer the right services to differentiate its product from the others.
I should also add that the short distance between the marina of Paralimni and the marina of Ayia Napa works in our favor for the sailors.
Q: To what extent is the marina financed by pre-sales?
A: Under our business plan, one third of the marina is financed by sales, one third by equity and one third by lending by financial institutions. I confess that at the moment due to the very good sales we have, equity and sales have so far covered all our needs. 85% of the residential development has already been sold.
Q: How are the prices of houses and apartments sold in the marina expected to move in the coming years?
A: Prices as the project progresses to completion have an upward trend in favor of investors entering the project. It is the so-called capital appreciation which comes not only from the completion of the project but also because the province of Famagusta, although it was first in tourism development, was nevertheless last in development.
Today, with the creation of large investments, a general demand began to be created in the province. In fact, as recorded by the statistics, the region of Famagusta has the largest increase in real estate sales.
So I believe that the marina of Ayia Napa will contribute to the increase of property prices for the benefit of investors who buy their residential projects.
Q: What is the profile of the marina buyers?
A: International. And I explain what I mean. First of all, let me say that the marina is not based on the sales of passports, even though we have buyers under the naturalization program.
The project is a destination that offers experience and a lifestyle. Our goal is specific, to those who want the lifestyle, those who want to have a nice apartment or house in a marina environment and those who like to have their boat in the marina and want to have an apartment or house in the marina .
This is our goal that differentiates us from all other developments within cities. This is one of the successes of the project, which is why the two investors, both the Karamontani family and the family of the Egyptian investor, Naguib Sawiris, saw this market gap and chose to build the development in this area which is from the most beautiful areas of Cyprus.
Among our buyers are Cypriots and I can say now that the percentage has started to rise. We have Russians who live in Limassol and have already obtained Cypriot passports but love the province of Famagusta because of the sea and buy as a second home or cottage in the marina, Lebanese, Egyptians on the part of the investor who promotes the marina, and Europeans. We generally have a nice mix of foreign buyers
Q: How is the Russian market affected by the rigor shown by the supervisory authorities in the banking and wider financial sector?
A: Supervisors have not stigmatized countries. On the contrary, I would say that they have rightly changed the system and are stricter for all countries, whether they are from Europe or third countries.
Certainly at European level there is already a single supervisory authority, so it was done in third countries as well, and it is not only Russia, it is America, Africa, the Middle East and Asia, so it does not focus on the Russians.
Supervisors do what they do right. In Cyprus, however, I believe that there is an overdose in the process of approving new investors who will bring their money to Cyprus. In Cyprus we are always either of height or of depth. This does not help in proper control. Excellent in every way, because there are cases through which the investors get angry and leave Cyprus. Unfortunately they chase away the right investors and go to other countries.
Q: What are the next steps of the Karamontani group?
A: The Karamontani group participates in the investment with a percentage of 20%. Apart from that, however, there are plans for other developments together with the Egyptian investor in the province of Famagusta as well as in other areas.
And I would like to point out that Naguib Sawiris loves Cyprus, he often came at a young age. This is not an opportunistic investor, he came to Cyprus to do a lot as he stated and he proves it in practice. So our plans are that we will continue the development with the right steps and not in a hurry.
Source: Stockwatch / Iros Efthymiou