Reflecting on our operations since 2018 and thinking about the future and our next steps
Hello everyone and Happy New Year. Since 2018 we have been investing in the Athens residential market, with quite a few positive results to report and numerous lessons learned.
Apart from the cyclical position that Greece and Athens is following a multiyear economic crisis, there is a significant structural housing issue that needs to be addressed. Low supply of modern housing. We have been trying to play a part in the resolution of this issue by refurbishing and repurposing existing spaces to new, contemporary homes. We believe this is the most energy and time efficient way to create new homes in a densely built city like Athens and we are proud for our work.
To-date, while the recovery was on its first stages we focused on prime areas. Apart from being the strategy where we had most conviction, as these areas where going to be the first to recover, it also served as a risk management tool, meaning that they would also hold up best in case the recovery faltered. This proved to be right, as during the unprecedented Covid-19 pandemic, prices did not move downwards, but just stayed flat until the markets reopened, when prices continued their upward movement.
Below, our investments to-date, having focused in high-end Kolonaki and booming south suburb areas of Vouliagmeni, Glyfada and Alimos.
For a live view of our portfolio, please click here.
During the time of our operations we have certainly learned a lot. From the efficient and lean operations of a new company in a new market, to balancing quantitative and qualitative research in a data-starved market as Athens residential, to optimising property capex expenditures and realising sales. Can’t wait for the next lessons that are ahead.
Currently, Europe is facing a number of challenges, that I will not analyse here but happy to discuss, and a slowdown or a mild recession is expected across Europe in 2023/24. As we saw in the post-2008 cycle, Greece is running with different speeds relative to the rest of the Developed World, usually at a delayed pace, which has placed the markets at an “accidentally countercyclical” position currently. Greece missed most of the growth and price appreciation boom since 2009 and only begun recovering mildly in 2016 and gathered pace from 2018; and then Covid hit.
Recovery got halted for a while, while after the economy re-opened post-Covid, pent up recovery demand and positive political and business reforms showed that the recovery was real and strong. After posting some of the strongest GDP growths in the European Union in 2022, Greece is still expected to outperform the EU in 2023, albeit at slower absolute growth numbers. Undoubtedly, Greece is interlinked with the EU in terms of economic performance, so we would expect any slowdown or recession in the rest of Europe to have its delayed effects in Greece, however, we believe that the different cyclical position that Greece is currently in, together with significant structural supply imbalances in housing predominately in Athens, make for compelling residential investment opportunities for the short- to medium-term.
We are currently in the process of raising funds for our upcoming residential projects, continuing with our strategy of buy-refurbish-sell and we would be delighted to talk to you.
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