Business Week: Greece sets $35m minimum price in London Home sale
Thu 07 Feb 2013
Greece sets $35m minimum price in London Home sale
Greece set a minimum bid price of 22 million pounds ($35 million) for a London townhouse, one of six overseas properties the government is selling to help pay its debts, two people with knowledge of the matter said.
The Greek consuls residence in Holland Park will be sold along with real estate in cities including Brussels and Belgrade, said the people, who asked not to be identified because the plan is private. They will be the first outright sales of foreign properties by the Greek government since the onset of the global financial crisis. Bidding for the properties will close on March 19, the people said.
Greece, which has pledged to generate 11.1 billion euros ($15 billion) from asset deals by 2016 to meet conditions tied to foreign aid, has so far raised about 1.8 billion euros, sparking criticism from European officials that the government isnt moving quickly enough. Real estate makes up about 75 percent of state assets and proceeds from property transactions, not budget cuts, should be used to improve Greeces finances, Finance Minister Yannis Stournaras said last month.
A spokesman for the countrys state privatization fund confirmed the pricing of the London home and declined to further comment.
The fund last week chose NCH Capital Inc. to develop a strip of land on the Greek Island of Corfu under a 99-year concession. NCH, a private-equity firm, pledged to invest 100 million euros as part of the deal.
Other properties the fund is selling include an 8,000 square-meter strip of land in Nicosia, Cyprus, for a minimum of 5 million euros; an eight-story office building in Brussels with a minimum bid price of 3.3 million euros; and a four-story building in Belgrade for a minimum of 2 million euros, according to the people.
Sales were delayed by months of negotiations over the countrys debt restructuring last year and two general elections that threatened Greeces membership in the euro.
The London property is a 115-year-old Victorian townhouse with 947 square meters (10,000 square feet) of space, according to the fund. Holland Park is in Kensington & Chelsea, one of the U.K.s most-expensive boroughs. Residents include Virgin Group Ltd. founder Richard Branson and TV-show host Simon Cowell. Marsh & Parsons Ltd. recently sold a 7,000-square-foot property in the area for about 20 million pounds, according to Keith Gorny, a director for the broker.
"We have several strong buyers interested in properties of this type," Gorny said. "They are mainly from the Middle and Far East and from Eastern Europe."
Londons most expensive homes, which increased in value by 6.9 percent last year as buyers competed for fewer properties, will outperform the rest of the U.K. residential real estate market in 2013, according to Knight Frank LLP. Prices in the super-prime market of houses and apartments costing 10 million pounds or more will climb as much as 5 percent this year, the London-based broker estimates.
The fund has also selected London & Regional, Elbit Cochin Island Ltd. and Lamda Development SA for the second round of bidding to buy a majority stake in Hellenikon SA, which will develop the site of the former Athens International Airport. At 6.2 million square meters, the site is more than three times the size of Monaco.