Wednesday, February 13, 2013

Greece seeks minimum £22m for UK property

It's selling consul's London home along with properties in cities such as Brussels, Belgrade
The Business Times - February 12, 2013

[ATHENS] GREECE set a minimum bid price of £22 million (S$43 million) for a London townhouse, one of six overseas properties the government is selling to help pay its debts, two people with knowledge of the matter said.

The Greek consul's residence in Holland Park will be sold along with real estate in cities including Brussels and Belgrade, said the people, who asked not to be identified because the plan is private. They will be the first outright sales of foreign properties by the Greek government since the onset of the global financial crisis. Bidding for the properties will close on March 19, the people said.

Greece, which has pledged to generate 11.1 billion euros (S$18.4 billion) from asset deals by 2016, has so far raised about 1.8 billion euros, sparking criticism from European officials.

Property transactions rather than budget cuts should be used to improve Greece's balance sheet, Finance Minister Yannis Stournaras said last month. Real estate makes up about 75 per cent of the state's assets.

A spokesman for the country's state privatisation fund confirmed the pricing of the London home while declining to comment further.

The fund recently chose NCH Capital Inc to develop a strip of land on the Greek Island of Corfu under a 99-year concession. NCH, a private-equity firm, pledged to invest 100 million euros as part of the deal.

Other properties for sale by the fund include an 8,000-sq-m strip of land in Nicosia, Cyprus for a minimum of five million euros; an eight-storey office building in Brussels with a minimum bid price of 3.3 million euros; and a four-storey building in Belgrade for a minimum of two million euros, according to the people.

Sales were delayed by months of negotiations over the country's debt restructuring last year and two general elections that threatened Greece's membership in the euro.

The London property is a 115-year-old Victorian townhouse with 947 square metres of space, according to the fund. Holland Park is in Kensington & Chelsea, one of the UK's most expensive boroughs. Residents include Virgin Group Ltd founder Richard Branson and TV-show host Simon Cowell.

Savills plc, a London-based broker, is handling the sale of the 120-year-old property, according to the Greek fund's website. The home, which the fund describes as an unmodernised Italianate villa, has a garden that backs into Holland Park and has one underground level.

The average price of a Holland Park home with five bedrooms or more has doubled to £7.27 million since 2009, when values slumped during the financial crisis, according to data compiled by Values peaked at £8.11 million in 2007, the research firm estimates.

Marsh & Parsons Ltd recently sold a 7,000-sq-ft property in the area for about £20 million, according to Keith Gorny, a director for the broker. "We have several strong buyers interested in properties of this type," Mr Gorny said. "They are mainly from the Middle and Far East and from Eastern Europe."

London's most expensive homes, which increased in value by 6.9 per cent last year as buyers competed for fewer properties, will outperform the rest of the UK residential real estate market in 2013, according to Knight Frank LLP.

Prices in the super-prime market of houses and apartments costing £10 million or more will climb as much as 5 per cent this year, the London-based broker estimates.

The fund has also selected London & Regional, Elbit Cochin Island Ltd and Lamda Development SA for the second round of bidding to buy a majority stake in Hellenikon SA, which will develop the site of the former Athens International Airport.

At 6.2 million square metres, the site is more than three times the size of Monaco. – Bloomberg

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