A decision by power company PPC to move its head offices out of central Athens means that a whole city block will be vacated near Omonia square, in one of the hottest areas in the real estate market.
PPC has been awarded a tender held by the Defence Ministry to develop former military barracks located on Mesogion avenue, opposite the Sotiria hospital, where it intends to set up a modernized head office and retail store. PPC will take on the property for 50 years, with an option for 10 more years, on a property that stretches over 1.8 hectares and accommodates 22 buildings.
Given that time and money is needed for PPC to build its new facilities, the lease agreement offers the energy company some discounts for using the land in the first five years. For the first year, PPC will not pay any lease land fees, while for the following four years, PPC will pay just 50 percent of the regular 1.6 million euro annual leasing charge.
According to market sources, most of 2020 will be used to settle all the paperwork on the lease deal and clearing existing building structures located on the site. Construction plans must then be drawn up, along with progress made on permit procedures. Based on forecasts, PPC will move to its new offices by the middle of the decade, assuming that there are no major problems along the way. This will help the company save a considerable amount of money given that its current rental agreement is more expensive and keeps getting more expensive.
The building that is being vacated by PPC, after setting up there in 1959, is located on Chalkokondili street. This is considered to be a prime spot with growing value in the area given the real estate investments taking place in the neighborhood. Six new hotels are in the process of being built around Omonia, in projects that will upgrade and clean up the district. Renovations work to the square, sitting in the heart of Athens, are currently in progress and will help add to the area's appeal.
There are also other development deals in the pipeline in the area, many of which have also been recently awarded to investors in long term agreements. These are buildings that are mostly owned by pension funds. One property that is being closely watched by investors is the former Minion department store owned by Folli-Follie. It is soon expected to be developed, through either a sale or a long term lease agreement.