National Bank of Greece (NYSE:NBG) is preparing to sell a luxury resort in the most exclusive resort of Greece, owned by the bank and the Greek state. The auction will serve as a test for the country’s ability to sell assets to consolidate its financial situation. Astir Palace complex, with an area of 307,000 square meters, has already attracted the attention of many investors, said Aristotelis Karytinos, general manager of real estate operations at the National Bank of Greece, the largest Greek bank. The credit institution and the privatization fund of the Greek government will hold a public auction in the coming months, he said, quoted by Bloomberg. “Astir is an asset with trophy status and we want to get the best conditions,” said Karytinos.
The funds raised through the auction will help the bank to adjust to the new international capital rules and for the Greek state any amount is welcome, as the government is behind on the targets established in the external financing plan of 240 billion euros that Greece was getting in the last two years from EU and IMF. The bank and the government will sell in a package the hotel complex, bungalows and private beaches nearby, to maximize the potential of assets.
The Greek state is committed to get, by 2020, funding of 50 billion by means of privatization. Half the amount would be drawn through the sale of real estate assets. So far, Athens has raised only 1.8 billion euros. So far, the policy of the privatization fund, to lease properties long-term instead of selling them, has discouraged investors, says Yannis Perrotis, director of CBRE Atria. The privatization program undertaken by the Greek government is a key condition of external funding agreements with the EU and IMF. Besides real estate, privatization fund must sell shares belonging to the state in utility and mining companies. The activity of the institution was slowed down by the political instability in recent months, in the context of political campaign and the inconclusive results of the May 6 elections.
Pro-European parties formed a coalition after elections held on June 17, and Antonis Samaras was sworn in Wednesday as prime minister, ending the long period of uncertainty about the direction of Greece and maintaining the country in the euro area.
Astir Palace is located on the Vouliagmeni Peninsula, 15 miles from Venizelos International Airport.
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