While other investors were fleeing Greece, NCH Capital was signing an agreement with the government to create an eco-friendly, luxury development on the island of Corfu. The Kassiopi Project is slated to create hundreds of jobs and help the local economy while supporting Greece’s bid to move away from mass tourism and attract more affluent visitors. Andreas Santis, NCH’s chief for the Western Balkans, Greece and Cyprus region, explains the benefits of the project for the country and urges authorities to help remove remaining obstacles
What drew the investment company to the region in 2012 to embark on a project to build a luxury resort in Erimitis, in the Kassiopi area of Corfu?
NCH is a private equity firm regulated by the US Securities and Exchange Commission. NCH Capital Inc. specializing in Real Estate, agribusiness, growth capital, turnarounds, and recapitalizations in numerous emerging markets. In 2012, due to our presence in the region in general and the fact that this asset was owned by the Greek government, we felt confident that the apparent bureaucratic and other issues could be simplified through a government structured process, and that we would be able to develop an eco-friendly project in one of the most beautiful coastlines of Greece. That was the rationale behind that particular investment on the island of Corfu.
This is a flagship project for Greece. What are the pillars that hold up the model?
It is a different type of project than what is currently on offer in Corfu. Whilst the island once boomed, over the last decade it has become more of an all-inclusive destination, and that’s what we are trying to change through the development of a high-end mixed-use resort. I full alignment with the presidential decree issued for this project, we plan to develop an eco-friendly, upscale development that will be under the management of a top tier international hotel chain. The idea is to attract high net worth individuals looking to get away from their busy schedules, the traffic and the noise, and come to a place where they can relax and enjoy nature. That is the core idea behind the project.
What will it look like when it is completed?
The project comprises a hotel with 90 rooms, hotel residences with 76 additional rooms, as well as a few villas. We plan for 21 plots for these on the hillside 19 plots on the seafront, where one can choose one of the predetermined villa designs to be built in a respective plot or even choose to consolidate adjoining plots to construct one of the villas. What is of vital importance to emphasize is that the whole area spans around 500 hectares of land of which only 35 are going to be developed, so it’s an extremely low-density development. As a matter of fact, we are planning to build a lesser density than what we are allowed to, so it can be as eco-friendly and natural as possible and promote this luxury lifestyle.
How do you find a balance between respecting the environment and local heritage and architecture, while offering something modern and luxurious?
This was one of our big challenges. We cooperate with one of the top architects in Greece, Alexandros Tombazis, whose work is well known for its bioclimatic design. We have tried to respect not just the environment but also the local heritage. We are in fact upgrading and enhancing the natural environment by creating facilities that will protect the forest, provisions made for fire and other hazards, allowing the use of only electric cars, creating walk paths, and more. Clients will be able to walk across the entire resort and feel far removed from their hectic, everyday lives. That was the main idea, and everything else revolves around it.
How is the project being developed?
We began the process in 2012, and it bears noting that this is not an agreement between two private parties but between a government and a foreign investor who arrived at the time when the majority of foreign and local investors were moving away. The idea is to develop the project in stages, to make it smoother and for financial purposes as well. In the first phase, we are going to create the infrastructure to make the project self-sufficient, such as the electricity network, the sewage and water systems, etc. – everything is provided within the project. The hotel and residences are part of stage one. Stage two is the development of the villas on a sell-and-build process.
How will the Kassiopi project help Greece and the Greeks?
It is going to promote local products, and visitors will be encouraged to leave the resort, visit the island of Corfu, and sample the food. Hundreds of jobs will be created during construction, and later at the hotel. We have made a deliberate decision to work with Greek companies and individuals even though we had the opportunity, as a global investor, to use foreign services, which would have also been efficient financially. However, we have made the conscious decision to work with locals to demonstrate through our actions that we were supporting the Greek economy and that we value their skillset and in their professionalism. We want to promote Greek cuisine, hospitality, and friendship, and we want locals to realize that such a development can only add value to their neighborhoods, country, and businesses.
Greece is currently moving towards attracting high-net-worth people rather than mass tourism, and to create year-round tourism as well. How is your project aligned with this?
I want to stress that while it is possible to extend the tourism season, we cannot expect miracles, especially on the islands. You cannot have 100% high-net-worth individuals either, but you can create the circumstances and infrastructure to attract them. There are other areas of Greece that are better for students and other types of visitors.
What could the government do to support projects such as yours in its quest to attract more affluent visitors?
A stand-alone development cannot attract by itself high net worth individuals. You need much more than that, such as good road infrastructure and a well-maintained heritage, which is now facing serious problems on Corfu. These elements need to be of the same standard as the development itself. Greece has been blessed with sea, sun, mountains, a good lifestyle, great food, entertainment, culture and a variety of places to visit. It is very important to upgrade and maintain all the cultural sites, not just the ones in Athens, and also to improve accessibility in order to attract high-net-worth individuals.
What message does your project send to potential investors as the country embarks on a path of economic growth?
I would like to thank and express our sincere appreciation to the current government for its support and I believe it’s extremely important for any foreign investors to see how those of us who are already here been treated. If you are trying to attract FDI, you need to take care of those who are already here. For a government, FDI is very important, especially in countries that had financial turmoil. It creates jobs, opportunities, it adds to the GDP, yet you don’t need to pay it back.
Are you looking at other opportunities in Greece?
We are looking at other things that are not limited to the hospitality sector, but we are extremely careful about where and how much to invest. We would first like to see the Kassiopi project unblocked, which means having the building permits in our hands and be able to commence construction tomorrow. Anything else is a near miss because you never know what tomorrow may bring. We are hoping that taxation and bureaucratic procedures will be minimized, adding confidence for us and for any others who may be considering coming.