The casino and the property market
We have finally reached the end. Of the original 12 who showed interest for the Cyprus casino, we shortlisted three and now there is only one. The reason is well known and is based on the heroic “NO” our MPs declared to exclude the lease of state land for the project, thus directing such an investment directly to the private sector rather than the state sector. Obviously, the few remaining landowners asked for excessively high selling prices and in one case the land value exceeded the expected development project cost of EUR 500 million. I would like to reiterate that our MPs, through their monstrous mistakes that will affect the Cyprus economy, have some criminal responsibility.
We have arrived at Zakaki, also known as Fasouri, a purely agricultural region of western Limassol. A depressed area in a green environment suffering from mosquitoes, but with several advantages: • The land is extensive and the value quite attractive. • It is near Limassol with developed services and good roads within close proximity to the Limassol-Paphos highway.
• Ii is ‘next’ to many things: the MyMall shopping centre (with plans for expansion), the Water Park (Lanitis) and next to the planned golf course. Also, the popular Ladies Mile beach is just ten minutes away by car.
• These projects next to the casino together with the Limassol seafront and the Marina, the fishing harbor and other projects that will be built (I’ve heard of a family business in Fasouri that wants to start a train for children, a winery and wine tasting) add to the whole scenery, and the existence of Limassol Port just ten minutes away, makes it a destination for cruise ships to visit. You might ask yourself, is a casino resort suitable for families? I do not know if it helps the whole concept.
The villages that will benefit directly from this development in the broadest sense are Zakaki, Trachoni, Kolossi, Akrotiri and even the most remote areas outside Limassol, such as the golf courses in nearby Paphos.
The casino resort will not be just a “gambling club” but a unique project in Europe with Las Vegas type specifications, with restaurants, entertainment venues, convention centre for 2,000 people, including a 5-star hotel (500 rooms) and many others. It is worth considering the new smoking prohibition law where similar investors in Spain withdrew their interest in similar casino project because smoking was forbidden.
We therefore expect that with the announcement of the start of work and completion, local real estate prices will probably rise to double the levels today for both home plots, as well as for large pieces with the new relaxations that allow all kinds of development, following the constraints within SBA that have been lifted.
In pre-crisis “golden” years of growth, the increased interest would have already occurred, but in another time. I expect that in the next year (after detailed plans have been concluded) to see an increase in demand for real estate of around 20% and with the start of work of the project an increase of 30%.
I expect the presence of about 2,000 workers in the area will also increase the demand for apartments for rent, plus apartments for casino guests in groups, and maybe a further 100 units for car hire agencies, taxi, take away, restaurants and more. Simultaneously there will be around 500 golf villas for higher budgets. Probably there will be demand for services that relate directly or not to the casino (in Las Vegas there are offices for weddings, but also offices for divorces and other strange matters).
It is known that the biggest gamblers in the world are the Chinese, followed by the Israelis, the Greeks, Russians, etc. We have good relations with all these nationalities, while the new China market with the expected direct flights by Cobalt may also help.
Certainly not to be over-optimistic but we should be concerned because there are issues which cause some skepticism, such as the search for financing by the winning bidder, obstacles in Cypriot bureaucracy, as well as the reactions by locals and casinos in the greater region, while we should also consider the infiltration by criminal gangs, or even the government getting stricter, as was the case with the betting chain OPAP that has lost several privileges.
As for the temporary casino plan to be located at Monte Caputo, this is probably the best solution for Limassol, while casino services in Nicosia (perhaps at the Kykkos property) is also a positive development, provided that it is linked to a hotel in the capital, beyond the “satellite” license for tables and gaming machines.
During a recent visit to the Casino in Malta, I noticed at least 1,000 people, mostly tourists, who were playing on the fruit machine and a further 100-150 in the main gambling area. “We are not only interested in the players, but also the greater benefit to Malta,” the manager of the casino told me.
Good news, then, for the region and the greater area of Limassol that should be congratulated for yet another achievement.