Constantin Pechlivanidis - Director, Strategy and Transactions, Real Estate and Hospitality Leader, EY in Greece.

Do you expect to see a decline in investment levels in your field in 2021?
Investment in the commercial real estate and hospitality sectors during 2020 exhibited significant activity, apparently without suffering measurable adverse effects from the health crisis.

It is likely that investors consider the pandemic to be a short- to medium-term issue, which will have a non- significant and transitory effect, in comparison to normal investment life-cycles.

This attitude, particularly pertaining to hospitality, may also relate to an expected strong rebound of pent-up demand after the long lockdown period, in conjunction with the “health passport” measures that seem to be gaining consensus, at least within the EU.

In view of the above, and with the end of the pandemic now seemingly attainable, we consider that investment levels will not decline, but rather continue to grow in 2021.

In your sector, what are the structural changes (legislative framework, infrastructure projects, etc.) that you think should be made within the next five years so as to increase tourism-related investments in Greece?

Investment activity growth, first and foremost – and regardless of sector – requires a clear relevant regulatory framework. Such clarity was in short supply during 2020, as the nature of the pandemic did not allow for the application, from the outset, of an effective and robust framework for the operation of hotels in particular, and the economy in general.

As we are now nearing a solution to the health crisis, regulations related to the operation of hospitality facilities need to be solidified into a workable, effective, EU-wide framework, which will allow enterprises in the hospitality sector to plan ahead, in terms of both revenue and cost. In terms of infrastructure, and regardless of asset type, access is king and, therefore, any improvement in the transportation infrastructure, could result in clear – if indirect – positive economic outcomes.

In addition, the pandemic has brought to the forefront the concept of remote working and, indeed, the concept of cross-border remote working. As Greece can be a preferred destination for such work schemes, telecommunication infrastructure needs to be upgraded, particularly in areas outside urban centers, where employees working remotely may choose to settle in, in order to combine flexible working with quality of life.

Finally, hospitality establishments also need to welcome such clients by adjusting their pricing and operations to a long-stay, multi-season concept, as opposed to the currently prevailing “short summer” vacation concept.


How do you see demand per segment taking shape within the next two years (V-shape, U-shape, etc.)?

While we are not in a position to identify the exact shape of the recovery, we are seeing elevated levels of pent-up demand, as a result of the lockdown. It is likely, although not certain, that once out of the gate, take-up will accelerate at an increased rate compared to conservative forecasts, assuming that adequate solutions or measures are in place for the ongoing pandemic, and no new black-swan events materialize.

Which areas of the country do you think will draw the most interest from investors and why?

Investment, besides clarity, requires sufficient size that allows economies of scale to grow and a measure of control over risk; in the Greek hospitality sector, this is translated to well-performing resort facilities of over 150 rooms, and in locations that traditionally attract massive, mid- to upper- medium-class, demand.

Such locations are Crete, the larger part of the Dodecanese islands, Chalkidiki, and the larger part of the Ionian islands. While we expect this trend to continue, there exist examples of investors actively looking at different ticket sizes and alternative locations.

Ultimately, what is important in the eyes of investors is access and robust operating practices.

What do you think the investment landscape in our country will look like five years from now?

We expect to see increased consolidation in both the hospitality and the commercial real estate sectors, with institutional investors increasing their share over smaller- sized, individual investors.

While such institutional investors may come from abroad, we are also seeing successful joint ventures between local and international institutional investors. We expect this trend to continue and intensify in the next five years.



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