Special Insert: Investments & Real Estate in Greece

A Brief Guide to Real Estate Investments in Greece

March 22, 2022
By Vasilis Delikaterinis

Recognizing the key role of the real estate business, RE, in generating sustainable growth in the Greek economy, the American-Hellenic Chamber of Commerce initiated a new, ‘Real Estate and Development Committee,’ comprising professionals with a deep knowledge, broad understanding, and hands-on experience in handling key issues related to the development and operation of real estate assets in Greece. The RE&D Committee will, among other things, support the Government in the formulation of an integrated strategic plan and the adoption of the right policies in order to attract the interest of private and institutional investors to real estate in Greece.

However, there seem to be certain misunderstandings regarding the nature of real estate activity and the role of the major players in the relevant markets. Clarifying the particularities of each sector of the economy would help all stakeholders realize the distinct aims they undertake to achieve in their particular market area, and to better understand what to expect from investing money and effort in a market which operates under its own conditions that leave no space for real estate development and operation. It becomes self-evident that the distinction between real estate and other business activities is a must and helps investors better understand what to expect from their investment in real estate or another business area.

What Is and Is Not Real Estate

In international terminology, the term ‘real estate’ (RE) signifies the land, any development or improvement realized on it, and the rights of its ownership or use. According to classical economics, land is one of the major production factors in all sectors of economy, which explains why many people categorize various business activities as ‘real estate’, although they have nothing in common with the latter. The leisure industry, logistics, and manufacturing are very good examples of this misinterpretation, as none of them are developed and operated under the same regulations and market conditions encountered by the original real estate players. The operational framework of a real estate company includes all those actions and services, spanning from the origination of a development opportunity to the best operation of the realized development.

Each development option requires the satisfaction of a set of financial conditions, through which the investor will secure proper financing from local or international financial markets, as well as real estate portfolio management companies, aiming at maximizing the return on investors’ capital. These conditions/services may be rendered either autonomously by a corporate entity offering integrated real estate services or in complementary combination with another player in the same market, offering a holistic approach to the client’s needs. It is quite often common to see contractors/developers collaborating with financial institutions to offer such holistic services. Companies with this philosophy may, at the same time, be recipients of some of these services, in a kind of a ‘special client-provider agreement’ i.e. when the company is the owner or user of a commercial center. The same applies when the recipient is a third party which manages the commercial center without any ownership or user’s rights on the property.

The role and activities of a real estate company are offered along two main axes. a) the Primary Area of Expertise in Real Estate Operations and Financing and b) the Customer Focus on the kind of customer i.e., occupant or investor. Under this approach, the role and major activities of a real estate company are grouped in six, partially overlapping groups of services, which define what criteria we can adopt in order to decide what is and what is not Real Estate. The six groups are:


Corporate Service Provider

Facilities Management

Occupancy Planning

Operation and Space Management

Lease administration

Corporate Real Estate Asset Management

Location Analysis

Fee Development



Operation and Space Management

Location Analysis

Own/Lease – Portfolio Analysis

Capital Structure Modeling and Advice


Investor Service Provider

Fee Development

Property Management

Leasing Agent

Asset Management

Market Research

Investment Intermediary


Market Research

Investment Advisor

Investment/Portfolio Analysis

Capital Markets Analysis

Company/Fund Analysis



Investment Advisor


Joint Venture Partner

Direct Investor




Portfolio Assembler


Investment Banker

Capital Structure Modeling and Advice

Capital Markets Analysis – Company/Fund Analysis

Source and Place Capital (debt and equity)

Establish Funds (for own company, or for others)

Private Placements

Even if the readers of this brief collection of thoughts on the nature of real estate do not accept the above approach, regarding what is and what is not real estate, it is most likely they will quite easily understand that this industry has already changed not only in terms of  practices and everyday procedures, but in deeper, core elements of the business, which distort the traditional perception of it as a secure investment opportunity while rendering it capable of producing remarkable returns in a shorter time than ever before.

RE has always been a slow-moving business venture, which promised rather conservative returns to investors during the life cycle of the asset, i.e. a period of 10-12 years. This is the main reason why pension or social security funds have been systematic financiers of

real estate assets for a long time in the past.

The increasing intermediation of stock exchanges in the RE business, however creates high expectations for returns in shorter periods of time, creating a ground for even higher fluctuations of property values, which is not normal in the RE market.

Another significant factor of change in the traditionally stable market of RE is the unexpected (and outside of all risk considerations) emergence of COVID-19, the pandemic which persists, for more than two years, overturning the normal standards of living in every spot of the globe.

The impact of the pandemic on business and social life is tremendous. We have noticed a violent change in our everyday actions and working conditions that cannot be easily absorbed as simple changes of our lifestyles, but which will have a huge impact on the fundamental parameters of various business sectors, mostly on real estate, all around the world. The forced adaptation to the change of working conditions through e-work, teleconferences, and the overall digitization of business and social activities have produced a completely new framework for corporate and working people and has forced them to elaborate new business models which will take into consideration the expected decrease of space demand and companies’ profits. The final outcome of this effort is not known. One thing is evident, however: the negative impact of COVID-19 will be less important to those countries that carefully worked on taking the right measures early enough in order to protect the people and their wealth. Maybe for the first time in history, Greece has had a pioneering position in dealing with a crisis, in this case, the pandemic, and won global recognition for the efficiency and effectiveness of the mechanism quickly designed and implemented for the sake of its people and their wealth. This is one of the reasons why Greece is expected to be the next destination for foreign investments in all sectors of national economy, as follows:

Greece As an Investment Destination

The Greek government is working hard to build a positive image of the country as a competitive destination for investments originating from the USA, China, or other financially strong players of the global economy. It seems that, for the first time in its modern history, Greece is closer than ever to winning the major role of being a significant junction between East and West, amidst a historically wide area of remarkable economic and social activity. Greece will then get rid of its image of being a small country with numerous problems and no strategic importance either to the East or to the West. The mission is difficult to fulfill, and the Greek people have to strive for it, eagerly offering every piece of their faith, energy, intelligence and patience to the national cause. However, beside the importance of HR, Greece needs to pay particular attention to drawing up an ambitious but realistic national plan, which will give the people of Greece a vision of where their home country should stand ten years from now.

Key Success Factors

Given the long-term goals and the vision for the next decade, the strategic plan should focus on the most significant factors that will direct the country toward a full-scale implementation of the measures provided therein, and towards a successful outcome for the collective effort. Some of the most important success factors, related in some sense with the real estate segment of economy are the following:

Foreign Direct Investments

FDIs in real estate will be critical to the overall success of the strategic plan as they can motivate the movement of additional financial resources to join those already allocated to the country by the EU and the local competent authorities. Investments in real estate will serve 100% the scope of the strategic plan, which sets as a priority the long-term rather than the short-term impact on the national economy and with corresponding benefits of the whole society. The important factors include:

  • The time element (Long-term perspective)
  • Complementarity of measures to be taken
  • Synergies of different kinds of investments
  • Co-ordination of policies and prioritization of partial targets
  • Special attention to the digitization of the economy (in general and in real estate)

The salient government policy issues of the real estate business in Greece include Urban planning and space management, general and segment-driven taxation, and investment incentives.

This is the only way Greece may be included in the group of investment-friendly destinations, build a reliable FDI support mechanism and convince the investment society that the country is never going to return to the inefficiency and malpractices of the past. Τhe future of the country is irreversible!

Vasilis Delikaterinis is Advisor to the Board of GEK TERNA GROUP SA and a member of the Real Estate & Development Committee of the American-Hellenic Chamber of Commerce.




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