With $3 billion under management and a rich portfolio of projects around the world, most recently the major tourism development in Corfu, NCH Capital saw a significant investment opportunity in Larnaca.
Against the backdrop of excavators in the former Beau Rivage district, Andreas Santis, Managing Director, Head of W. Balkans, Greece & Cyprus, describes four developments that will make a decisive contribution to changing the image of the city of Zenon.
Huge growth prospects
“Cyprus is a European country, it has a tourist culture, geographically it is in an ideal location, although the only way to get there is by air, and the weather conditions are excellent. At the same time, it is considered friendly to foreign investment, having, among other things, a stable tax system. Based on the criteria we set, choosing the city of Larnaca was the only way out for us.
In our opinion, for this type of project, Larnaca has the greatest development potential compared to the rest of the coastal areas of Cyprus. There are no new tourist developments on the first coastline in the city at all, there is an international airport and a beach hotel complex can operate there permanently. In addition, in value terms, it is lower than in the rest of Cyprus. The Pyla area was also a conscious decision, because we believe that this particular beach has the best beach and all the prospects for becoming a tourist center of the city.
Of course, the expected transformation of the coast and the port will give additional dynamics to the city of Zenon, but our decision was made in advance, taking into account the parameters that I mentioned above. The movement of oil tanks also played a role in our decision, since this very point of the coastal front is directly connected with our own projects, and their movement creates a continuous front with great development prospects.
Larnaca lacked investors
I believe that the delay in the development of the city is due to the lack of investors and, dare I say, a vision of how best to develop the city. Over time, he lost infrastructure facilities, and oil tanks killed his coastal front from the airport to the Dhekelia region. On the other hand, it suffers from bureaucracy, which is the biggest problem and obstacle to creating new investments, especially from foreign institutional investors, both in Larnaca and the rest of Cyprus. Time is money and we are concerned about the delay in the implementation of investments. In recent years, attempts have been made to simplify the procedures, but the desired result is still far away.
Please note that for our four projects alone, the total amount is estimated at more than 200 million euros. At the same time, a very large number of workers will be involved in construction through construction companies and suppliers. Also, with the completion of the projects, more than 500 permanent jobs will be created. The tourist product of the city is definitely in need of an update, and this is easy to see from the existing hotels and the year they were built, except of course for a few small exceptions. I mean, mostly hotels by the sea, not in the city, where in recent years we have seen a growing trend to create them. The movement of oil tanks links the city of Larnaca with the rest of the tourist front up to Dhekelia. I believe that with the planned investments, with more branded units and resorts being created, Larnaca’s hotel product will change its shape, be upgraded and attract more and higher quality tourists.
Infrastructure work needed
The city has so far never attracted the quantity and quality of tourists it could, due to the lack of sufficient high-end hotel units, which consequently did not allow for the establishment of appropriate supporting structures and services.
In addition to private sector investment, which we see constantly growing, the city also needs basic infrastructure projects, for which the state is responsible. Especially on the coastal strip, from the port to Pyla, there are no basic safety related infrastructure needs such as footpaths, bike paths and lighting. The creation of two or three high-level hotel complexes is not enough to change the tourist product of the city. The infrastructure that will support it is also needed.
Otherwise, Cyprus is an attractive investment destination, with a consistently low tax rate, a land registry that guarantees title to property, and a banking system that, despite the problems it has faced, has stabilized. There is always room for improvement, with the biggest problem always being the bureaucracy that creates delays in projects.
NCH Capital projects in Larnaca
Signature Hotel, Agios Lazaros area
Mixed tourist complex (5* resort and apartments), Pilas beach
Hotel complex, former territory of Beau Rivage, Pyla
TROY, luxury residential complex, 280 apartments in Pila
NCH Capital is preparing four different tourist/residential development projects in Larnaca:
Hotel with 60 rooms next to the church of St. Lazarus, which will be branded. The brand name will be announced soon, with the signing of the relevant agreement. The start of construction work is expected to begin in mid-June this year with completion in February 2024.
The above project, as well as the 5-star seaside resort in Pyla (hotel, 107 apartments and 10 villas) are being implemented in cooperation with the Polish organization Supernova Group, represented in Cyprus by Edge Developments.
The third will be a tourist complex and will be built on the site of the already demolished Beau Rivage Hotel. It will have 120 hotel rooms and 80 apartments.
The fourth project, TROY, again in Pyla, is a 280-unit residential complex that will function as a resort with a spa, wellness center, swimming pool and a small commercial building that will serve the needs of the complex. It will be the largest of its kind in Larnaca. Part of the overall building factor was used to increase spacing between the 12 buildings and more green space, maximizing sustainability.
In all our projects, sustainability and the use of renewable energy sources are of paramount importance.