(Bloomberg) -- On the southern coastline of Greece’s capital, a long-awaited plan to transform the city’s former airport into the largest smart city in Europe is finally gaining momentum.
Most Read from Bloomberg
NYPD Arrests Over 300 Protesters in Crackdown on College Campuses
Lilly Soars as Forecast Boost Shows Weight-Loss Drugs’ Power
The Ozempic Effect: How a Weight Loss Wonder Drug Gobbled Up an Entire Economy
After a decade of delays, a vision of the Ellinikon is emerging. The Marina Tower, soon to be Greece’s first skyscraper, is beginning to rise. Iron skeletons of condos are taking form. Standing on the marina, with a view of the Saronic Gulf on one side and the tower on the other, it’s possible to imagine the future city, which will feature the open spaces, sustainable energy sources and abundant green spaces that Athens currently lacks.
ADVERTIsem*nT
“There was justifiable disbelief” in the project’s early days, Odisseas Athanasiou said in an interview. Athanasiou is the chief executive officer of Lamda, the developer behind the multiuse development.
Spread across 6,200 acres a 20-minute drive outside of Athens, Ellinikon will transform both the coastline and the country. It’s the kind of project normally seen in China or the United Arab Emirates, and a sign of Greece’s post-crisis revival and subsequent investor enthusiasm. Developers project that it will add 2.5 percentage points to Greece’s GDP, create as many as 80,000 new jobs and generate tax revenue of more than €10 billion following its completion in 2037. It’s also expected to draw an extra one million tourists a year, who will be able to choose between a Mandarin Oriental hotel and an integrated casino-resort for their lodgings.
Greece’s tourism sector has rebounded since the Covid-era, with 32 million visitors last year and 2024 on track to see a record number of arrivals.
For those who want to stay permanently, 243 units have already been put up for sale in the neighborhood called Little Athens, and 140 have been reserved. The Marina Tower apartments, beachfront villas and condos sold out first, and Lamda announced earlier this month that proceeds from property sales have totalled €641 million as of last March. The majority of buyers have been Greek nationals, and the city is expected to house as many as 20,000 people in about 10,000 residencies within the next 13 years.
Working off the urban planning concept of the 15-minute city, Ellinikon residents will be able to access schools, parks, offices, stores and even the beach in less than a quarter of an hour. Software to oversee waste, water, and energy services will be laced throughout the complex. “It’s a smart city end-to-end,” Athanasiou said, adding, “we like to call it ‘Zip Code Paradise.’”
The process of getting Ellinikon off the ground hasn’t been smooth. When Lamda purchased the plot of land in 2014, parts of it were littered with the ruins of the former airport – including abandoned aircraft – while other parts housed refugees and undocumented migrants. The beachfront was scattered with nightlife set-ups and long-forgotten sports facilities. Delays in the permitting process dragged things out further, and the fact that Greece was effectively bankrupt when the project was proposed made it seem even more unlikely it would ever get off the ground.
“We had a construction sector in Greece which was at its lowest point in ten years, due to the crisis,” Athanasiou explained. “People had left the country, and construction companies weren’t as strong as they used to be. Increased construction costs due to the energy crisis after the incident in Ukraine added to this situation.”
While those challenges have subsided, Lamda was — and is — still dealing with a labor shortage. Around 7,000 workers will be needed when construction gets underway next year around building the Ellinikon mall. Lamda has about 2,000 workers at the moment, and is in advanced talks with contractors about importing construction workers from other countries.
Still, Athanasiou described the company’s biggest challenge as its “lack of credibility.” Before construction started, the CEO said, “you had a bankrupt country, a huge project even for European standards, let alone Greece, and a company that had never taken over a project like that before.”
These obstacles, however, have gradually faded as the new city has become a reality.
By the end of the summer, seven new condo buildings will be visible from the coast, alongside the skyscraper in progress. By the end of the year, that high-rise will have reached 100 meters (330 feet) and the number of seaside residential buildings in progress will have jumped to 15. By the close of 2025, a sports center with soccer fields, tennis courts and swimming pools will open to the public.
“By Christmas of 2026,” Athanasiou said, “we want residents to be living in their houses.”
As Greece’s economy recovers from its decade-long crisis, renewed interest is also coming from investors. The country has been granted investment grade-status from two of the three big rating companies in the last year, and investors flocked to the Athens Stock Exchange during a successful IPO from the Athens International Airport and stake sales in the country’s main banks.
Despite rising nearly 16% in 2023, Lamda’s stock has been stuck around €7, which Athanasiou attributes to broader pain in the real estate market. “Our strategic goal is to diversify the investment assets, malls and marinas,” the CEO said. The company has been pitching potential investors in the UK and US on Ellinikon’s marinas, and is waiting for the right moment to launch an IPO for its malls.
There’s also reason to think that Ellinikon will be profitable from here on out. Bought from the Greek state for €915 million in 2014, Lamda returned to the black in 2023 and beachfront residences now sell for as much as €15,000 per square meter. “There is enormous hidden value” in company results, Athanasiou maintains. Offers for plots of land around the mall and offices have also surpassed €2,000 euros per square meter. “That's almost triple the value in our books,” he noted.
Optimism, in short, is running high. And as for concern that tourists flocking to Athens might be more interested in the ancient city’s historical offerings than its state-of-the-art amenities, the Lamda CEO isn’t worried.
“Is there any reason why someone visiting Ellinikon would decide not to go and see the Acropolis or Sounio as well?” Athanasiou wondered. At the same time, “is there any way that they’d hear about a place nearby with the tallest buildings, five high-rises, a casino resort, and choose to just stay at the Acropolis?”
(Updates with details of sales in the 6th paragraph)
Most Read from Bloomberg Businessweek
Modi Is $20 Trillion Short on His Grand Plan for India’s Economy
AI Is Helping Automate One of the World’s Most Gruesome Jobs
©2024 Bloomberg L.P.
