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Astir Palace goes to AGC Equity Partners

The sale of “Astir Palace Hotels of Vouliagmeni”, an area of more than 110 thousand square meters, will be transformed by AGC Equity Partners consortium into a luxurious resort development.

The deal was approved yesterday by the governing council of National Bank of Greece. The plot was finally sold to Jermyn Real Estate Fund IV L.P. after the written consent of the Hellenic Financial Stability Fund.

The “jewel of Southern Attica”, which lies in the southern suburb of Vouliagmeni in Attica, just a few kilometers from the city center, is a small paradise and a weekend getaway for many Athenians

AGC Equity Partners is an Arab fund, which has offices in the Middle East and gets its funding from two very powerful state funds from Abu Dhabi and Kuwait. Partners in this fund are also some of the most influential and rich families of the Middle East.

Moreover, a junior partner of this fund is the Turkish Group, Dogus. Dogus Group is one of Turkey's largest conglomerates, active in eight business lines - financial services, automotive, construction, media, tourism and services, real estate, energy and entertainment - operating 193 companies and has a workforce of over 33,000 persons.

But what did AGC really get?

First of all AGC acquired the “Arion Resort and Spa”, with 123 rooms that were fully refurbished in 2004, 58 bungalows, a spa, a conference center and banquet halls.

It also acquired “The Westin Hotel Athens” with 162 rooms, with large banquet halls, another conference center, which was also refurbished in 2004.

Through a capital increase, TAIPED, the Hellenic Republic Asset Development Fund, will offer the third building, known as “Aphrodite Hotel” along with its surrounding grounds. These include a hotel building of more than 20,000 square meters and its grounds of approximately 90,000 square meters.

The hotel includes 165 rooms, but of course needs to be refurbished, since it hasn't been used for quite some years.

This whole area of approximately 110,000 square meters belong to the National Tourism Organization (EOT), with the National Bank of Greece and a company called “Astir Palace” which have the right of receiving a rent for the use of this land until the end of 2029.

Moreover, Astir Palace has the right of use of Astir Beach, right next to the hotel, until the year 2022 and a contract for the use of the nearby marina until the year 2052.

AGC will have the right to develop and use the three hotels and the surrounding grounds, always for tourism purposes, since there is a law protecting the use of land in this area only for recreation and tourism purposes and must not build anything on 50 percent of the surrounding area, or 160 stremmas. It can demolish any or even all the hotel buildings and may instead build luxurious summer houses and villas in their place. However, what is mandatory from the deal reached, is to have at least one hotel of 17 thousand square meters or more and of a capacity of 265 beds.

This deal paves the way for other tourism development the Hellenic Asset Development Fund is trying to sell. Is Rhodes next? Will the Arabs give the signal of more foreign funds to invest in Greek tourism?