Insight ATHENS CASINO PROJECT
As the world’s largest casino operator, Las Vegas Sands is examining its options having rejected plans for the creation of a €30bn mega-resort in Spain.
THE MASSIVE SITE Hellenikon, Europe’s largest unused tract of urban
real estate, an area that’s twice the size of New York’s Central Park, and the epitome of all that’s wrong with Greece’s asset-sale program - and where its greatest opportunity may lie. The government plans to select a developer to rebuild Hellenikon, thus helping the country to emerge from a six-year recession that deleted at least a fifth of the economy and left more than one in four adults jobless.
The site, a 20-minute subway ride from the city center, boasts a marina, access to the tram line, which runs the length of the coast, a police station, churches, a power sub-station and ancient ruins. Four of the 480 buildings are protected: the east terminal of the old airport building, designed by the Finnish-American architect Eero Saarinen.
SHIFTING SANDS EYES ATHENS
Las Vegas Sands is eyeing the creation of a casino in Athens, following its decision to scrap plans for the building of a €30bn mega-resort in Spain, Euro-Vegas
Sheldon Adelson, the head of the Las Vegas Sands has proclaimed that he’s ‘examining options’ in various European cities such as Athens, Rome, Madrid, Barcelona, Milan and Paris for the creation of casino resorts.
This is not be the first time that the Israeli- American billionaire will be knocking on Greece’s door. In 2007, Mr. Adelson submitted a casino proposal for Athens’s former international airport at Elliniko to Giorgos Alogoskoufis, who was finance minister at the time. Elliniko is known for the Hellinikon Olympic Complex, built on the grounds of the former Elliniko International Airport for the 2004 Summer Olympics.
The issue of creating a casino in the Greek capital initially arose in 1994, when the country’s first casino permits were issued. However the subject has re-emerged as a topic for discussion since the start of the privatisation process concerning the Elliniko site. In fact a special plan for Elliniko’s development recently handed to interested investors provides for the creation of a casino. The question of whether a casino will finally operate on the plot will be answered in another tender that the state will conduct at a later stage,
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after the completion of the concession process. The same applies to the privatisation of the Astir Palace hotel at Vouliagmeni, southern Athens.
The issue of operating a casino in Athens initially arose in 1994, when Greece’s first casino permits were issued. However the subject has re- emerged since the start of the privatisation process of the Elliniko site. However, market experts claim that the operation of a casino at Elliniko could create more problems than it would solve. OPAP had raised a legal issue as it holds the €565m license to operate video lotto terminals and its agents have to follow rules such as player limits and identity cards by law. However, these rules do not apply to casinos.
The Loutraki casino has reacted in a similar way, as the Greek state had formerly promised the company that no casino would operate in the capital. However, that problem could be overcome by changing the law on taxation and reducing the rate for casinos from 33 per cent to 20 per cent, which would satisfy the Loutraki casino.
Generally, Las Vegas Sands does not enter tender processes when it wishes to obtain a license. It tends to negotiate directly with governments for the creation of resorts with casinos instead of making bids. It appears that this would be its plan for Greece.
Europe’s most ambitious privatisation program so far has pulled in less than 10 per cent of the original target. However, a successful outcome for Hellenikon could see the creation of 35,000 new jobs and over 40,000 permanent positions with investments estimated at more than €5bn over the next decade, boosting tourism and construction industries. The development could include casinos, hotels, offices and residential areas.
In January last year, three bidders were cleared for the final concession phase: Elbit Cochin Island Ltd., an Israeli investor and developer of retail properties in eastern Europe and India; Athens- based Lamda Development SA (LAMDA); and London & Regional Properties, the master developer for a former US base in Panama, one of the world’s biggest development deals.
Lamda CEO Odysseus Athanassiou has said that the project could attract investment of as much as €7bn and 1 million more tourists to the Athens area. He drew a comparison with the development of Marina Bay in Singapore (the benchmark by which all casino developments are currently being compared), which he said created 30,000 jobs, boosted the economic growth rate by 0.8 per cent and added 25 per cent to tourism. The economy in Greece is expected to return to growth this year, though at a pace of 0.6 per cent. Greek banks may need more capital, and European policymakers are set to consider fresh funding for the Greek state and extend its payback time to ease a debt load that was 176 per cent of GDP in 2013.
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