The difference between theory and reality

Although I have been writing for quite some time, the persistence of the respective governments and various government officials and others on some issues and their inability to separate theory from treality, will never cease to surprise us.

Old GSP: From the first day I had expressed the view that the project was doomed. I proposed the option of creating a multi-use centre just as in the Saripolou area in Limassol. After three expensive studies indicated that the project is not viable, came a fourth with a hotel attached. I indicated again that the hotel cost is not consistent with expected revenues, while the examples of the low occupancy of the capital’s hotels and the recent sale / exchange of debt against a hotel in the capital, is an indication of the whole situation.

Public Transport - Nicosia: It’s not enough that we subsidise public buses with millions per year, some clever person suggested a tram for Nicosia. At a cost of EUR 216 million we spent thousands of euros on studies after studies and eventually discovered that the state does not have the EUR 216 mln. And certainly not even the ability to subsidise further losses, and so an investor of this magnitude must be crazy to adopt the plan, that included the BOT (buildoperate-transfer) method.

Prime properties: We have had studies for prime government plots in Nicosia and elsewhere. We were told the obvious (having paid a foreign consultancy firm around EUR 250,000) to ‘cut’ up land into smaller plots to build a hotel in Nicosia (while the other existing hotels are crumbling financially) and replace the site of the new museum (old hospital) with a mall. God help us.

Pentakomo tech park: After the tragedy with Bill Gates and having spent millions on expropriation, we have seen new studies yet again for the establishment of a Technology Park. I assure you that there is no interest - simply because as the Cyprus system and public service we do not have the ability to apply those that we say, with some foreign investors in Cyprus even resorting to full-page advertisements to protest the delays.

Government offices:

A

very

popular

topic

among journalists and others unrelated to the property industry who refer to the cost of the payable rent with the conclusion that it is better for the state to build its own offices rather than rent. And yet on three different occasions I have argued and proven hat renting is advantageous when considering physical damage to buildings, the property tax, maintenance and income tax and of course the return on investment capital.

Akamas: After 27 years of specific references that the existing policy (as it evolves) cannot be applied since, thankfully, we have exceeded the level of expropriation and compensation from the times of when Mr. Silikiotis was Minister of Interior, we are back at zero and starting from the beginning. The Park has many parameters some of which reach the level of stupidity.

Casino: Here we go again. Our wise parliament (the ones who said the heroic NO during the 2013 haircut on deposits) voted a law that forbids the State from renting even a square metre for a casino. Of the three aspiring finalist bidders (from the original 12) only one remained, the only one that was able to secure land at a “reasonable price” resulting in the state being in a very weak bargaining position when it comes to the licensing cost. So instead of the state having the option of land rental to the selected bidder, it has passed on this right to individuals (I do not know what interests there may be, but the temptation is huge).

Larnaca Port: We will be stuck with this one as well, with a new study now underway to find interested investors. I assure you there is zero prospects, despite the fact that the Minister of Transport has reported some serious interest. The problem here are the people of Larnaca themselves.

Paphos marina: Do you remember the soap opera Peyton Place? We are about halfway there with anticipated developments, while the viability of the project is also in doubt.

Our dear readers should be able to distinguish from the beginning what is possible and that our size does not allow us to be choosy when it comes to attracting (and keeping) foreign investors.