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Developers attract half billion of fresh money

developers attract half a billion eurosLAND development business has brought €500 million of fresh money to Cyprus despite the financial crisis the country is facing, Minister of the Interior Socratis Hasikos has said, adding that the sector should be assisted to overcome its problems.

The Cyprus Association of Land Developers, accompanied by Hasikos, briefed the President of the Republic Nicos Anastasiades on the problems facing the sector which accounts for 16% of Cyprus GDP.

“The sector is one of the main areas attracting foreign investors,” Hasikos said in statements following the meeting, adding that the majority of the hundreds of millions of investment that came to Cyprus in the past eight months, mainly by non EU citizens wishing to obtain permanent residency or citizenship, were channelled by these businesspeople.

As land development businesses face mounting pressure to repay their loans which according to press reports amount to billions of euros, Hasikos said that the government intends to facilitate their efforts to overcome their problems and strengthen attempts to attract investors.

On his part Pantelis Leptos, the Association’s President, said the sector has brought “huge investments to Cyprus amounting to €500 million in this challenging period, adding that the industry could attract even bigger investments if it is given incentives”.

Replying to a comment that the biggest land developers have sizeable debts to the banks, Leptos said that restructuring measures aiming at restructuring non-performing loans should be taken in the light of new developments following the Eurogroup decisions on a bailout which Cyprus has agreed with its international lenders in March last year.

“These measures should be realistic and feasible,” he said.

In March 2013, Cyprus and its international lenders (EC, ECB and the IMF) agreed on a €10 billion bailout which featured a haircut on deposits over €100,000 to generate capital for the ailing banks. Amidst increasing non-performing loans, Cyprus banks and mainly, Bank of Cyprus, the island’s largest lender has increased pressure on land developers to start servicing their loans. According to press reports, Land developers are the largest customers among a list of BOC customers that owe the bank €6 billion.

Source:  Cyprus News Agency