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Opportunities for International Investors in the Greek Tourism Sector

"Mainly due to the mortgage crisis in the USA, land prices all over the world are dropping, making this an excellent period for great land investment opportunities - some of which are, well, greater than the others. Which is exactly the case with Greece. In Greece, apart from the considerable reduction in land prices - which used to increase literally every month during the past five years - there are another three huge factors, that make the Greek Land Investment Market hard - and costly - to ignore.
First, the low prices of excellent plots of land in Greece. Unlike its Mediterranean "neighbours" Italy, France and Spain, land prices in Greece are still relatively low (although that is estimated not to last long - see below).
Second, the lack of a reliable national land registry, which has possibly been the biggest problem in the past, is coming to a final solution. A modern, centralized and online accessible land registry is set to be completed by 2010 - which, according to most relevant studies, is the year that land prices will begin climbing again.
Third, the not-so-serious motives for investors that the Greek Government used to provide, are now a thing of the past. There is a national plan of high priority to increase the Greek tourism by no less than 50% in the next five years. This, in simple Greek, means that there will be huge, one-of-a-time opportunities for land investors in Greece, during these five years. According to numerous studies that monitor the trends of the Greek Real Estate Market, in many areas of tourism interest, the predicted increase in land prices, during that five year period, is estimated to be between 100% and 150%.

As many relevant studies show, and as we ourselves have experienced, since the beginning of 2008 there has been a rapid increase of interest from international investment companies, who want to exploit the "tidal wave" of tourist development that currently takes place in Greece. Most of these companies are from the UK, Scandinavian countries, the United Arab Emirates, Russia, Israel and China. There are still great opportunities throughout the country, especially in Crete island, but the time to act is now. As the CEO of a big investment fund has recently said: "In the end of the 90s it was Spain. Now it's Greece."
Greek Development Law: Great Investment Opportunities in the Greek Tourism Sector
Here a summary of the provisions of the Development Law 3299/2004 as it applies to investment projects in Tourism Sector in Crete.

The Greek Law 3299/2004 has reformulated the incentives provided for private investment for economic development and regional convergence in Greece. These incentives take the following forms: a) subsidies and leasing grants or b) tax relief or c) cost subsidies for new employment created. Only one of the three types of incentives listed above can be applied in each project according to the investor preferences.

The exact amount of aid provided in each of the three types of incentives depends on:

a) the type of the project

b) the project location and

c) the size of the company (according to EU criteria which define which enterprises are considered small, medium and large).

According to our experience most investors prefer to submit applications seeking subsidies (cash grants) and leasing payment subsidies.

The Development Law 3299/2004 has been modified in December 2006. The modified Development Law sets forth a “basic percentage” of subsidy for all enterprises (irrespectively of size) which depends a) on the classification of a project in one of the two possible categories (Category 1 and Category 2) and b) the geographical classification of Greece in three investment zones (Zones A, B and C). Crete belongs in Zone B (according to the new zone classification system established in December 2006).

According to the Development Law modification of December 2006:

"For very small and small enterprises, as set by the EU legislation, as these are designated by EU legislation in effect in each instance, which implement investment plans, an additional subsidy is provided and / or leasing subsidy, which is equivalent up to twenty per cent (20%) of the cost of the subsidized investment. In the case of medium enterprises, the additional subsidy is equivalent up to ten per cent (10%)".

A ministerial decision is in effect, which defines the exact amount of additional subsidy, which corresponds to each project on the basis of the following primary considerations: a) the gross domestic product per capita of the area, b) the unemployment rate of the area and c) the location of the area.

Are you planning to invest in the booming Greek Tourism Sector? You can harvest our large expertise in investments in Greece.
When you work with Ktimatoemporiki Crete, you work with the experts in tourism and property investments in Greece. You want to make it happen, and we can make sure that you will - from the beginning, up to the final stages of your investment.
Contact us now at [email protected]
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