Bids re-open for old port 10-year lease
The Cyprus Ports Authority, the state owner and operator of the island’s main commercial harbours, is re-inviting tenders for the Limassol Old Port facilities, that had only received one bidder last August for the ten-year deal worth EUR 26 mln.
A Cypriot expatriate with business interests in the U.S. was the sole bidder, clinching the ten-year tender for an annual lease of EUR 2.6 mln, 300,000 euros more than the minimum offer. But government sources said that the investor had soon backed out of the bid.
The Cyprus Ports Authority had given out to tender the ground facilities of the old port in June 2014, which was renovated in recent years at a cost of EUR 17.8 mln, more than double the initial cost of 8 mln that was planned in 2010. The new tender is available at www.cpa.gov.cy .
The old port, that includes 18 new buildings and two that were recently renovated, cover a commercial space of 5,800 sq.m. and was offered in an open tender for a ten-year lease upwards of EUR 2.3 mln a year, with an option to renew for a further ten years.
The new investor was expected to undertake to rent out the facilities to third parties, but also to maintain and repair the buildings.
One of the two renovated buildings will house a winery and the other will be used for exhibition purposes. The 18 new buildings will house four restaurants, bars and cafés, three tavernas, three snack bars, 17 shops and seven floors of office space.
The old port project also includes a building that houses the Fisheries Department, as well as a fishermen’s cove as the facility will continue to operate as a fishing harbour and fish market. The Fisheries Dept. will be responsible for the anchorage of the fishing and other vessels.
The project area also includes a piazza-square, parking spaces and a deck and public bridge from where pedestrians can look onto the harbour area, as well as the adjacent newly built Limassol Marina.
Meanwhile, the Ministry of Communications and Works has submitted to parliament a revised tender document for approval, to develop the commercial operations of Limassol port, the biggest in Cyprus and part of the government’s privatisation plan that needs to raise EUR 1.4 bln in four years. Netherlands-based APM Terminals and Dubai’s DP World were said to have shown interest, with the government abandoning earlier plans for privatisations, and now opting between a licensing agreement and concession.
Transport Minister Marios Demetriades, who handles the portfolios of both transport and maritime, had initially said that the procedure for privatisation of the commercial services at Limassol Port would get underway by the end of April, a deadline later moved to end-May and now pending before parliament.
Already, consultants Rothschild have embarked on a market sounding process in a bid to assess market interest. Demetriades said that prominent corporations in port and cargo terminals management have expressed interest for the services at Limassol port.
“I believe the investor will be selected by the end of the year and the process will be completed by the first quarter of 2016,” Demetriades said.
He said the Ministry’s advisors are currently examining the legal framework for privatisation, noting that the options under consideration are either a license contract or a concession agreement for a period of 25 years. Global advisors Pinsent Masons LLP had been selected earlier in 2015 to provide legal services to the government, aimed at the successful completion of the process of licensing of all or part of the commercial operations of the Limassol Port.