NYT — Greece on Tuesday signed a major privatisation deal that will fulfil a key condition for the release of further bailout funding, but it will also displace thousands of refugees.
The deal, for a huge luxury real estate project on the site of the capital’s former international airport, was made in a memorandum of understanding between the state privatisation agency, Taiped, and a consortium of Greek, Arab and Chinese companies. The land sits on a prime piece of coastline in Elliniko in southern Athens.
Elliniko is part of an ambitious privatization program by Greece’s government and the country’s international creditors. Apart from Greece’s power board and other state companies, the portfolio of Greek assets for sale includes former government buildings, beaches and hotels.
The deal, which was frozen for a year and a half because of protests, was hailed as a breakthrough. Taiped’s chairman, Stergios Pitsiorlas, said the site, which covers four square kilometers, or 1.5 square miles, would accommodate “the largest urban regeneration project in Europe,” and create thousands of jobs for the debt-ridden nation. The site will also have the largest metropolitan park in Europe, he said. The office of Prime Minister Alexis Tsipras said the investment would help “restart the economy.”
Currently, however, the site is home to some 3,000 refugees who live in a makeshift settlement in the former airport building. The structure also houses several small companies, chiefly shipping and advertising firms. It had served as sports venues for the 2004 Olympics in Athens.
The government has promised to clear the site and relocate the refugees to a yet-to-be-determined location by November.
The deal was one of the few loose ends needed for creditors to sign off on 7.5 billion euros in bailout money after the approval of fresh austerity measures in recent weeks.
It was clinched after locals “came around to the idea,” Mr. Pitsiorlas said in an interview. The developers also agreed to demands by the Greek state for the site to include more green spaces, and to pay maintenance costs. The site will also have malls, golf courses and luxury homes.
The consortium of Lamda Development, the Abu Dhabi-based real estate firm Al Maabar and the Chinese conglomerate Fosun International has pledged 915 million euros to lease the plot for 99 years. Another 7 billion euros will go toward the creation of parks, luxury homes, golf courses and the extension of the public transportation and drainage network over 15 years. According to Mr. Pitsiorlas, the project would create more than 40,000 jobs.
The “new living standard” envisioned for Elliniko in a video on Lamda Development’s website is a far cry from the current state of the site, described as a “mass ghetto” by a local mayor, Yiannis Konstantatos.
Despite pressure from creditors to sell off state assets, a succession of governments have raised just over 2.5 billion euros from privatisations, including the leasing out of Greek regional airports and the Greek horse race betting organisation, compared to the lenders estimate of 50 billion euros.
