ARENCORES MAGAZINE Issue |No. 8

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JUNE 2020 I SSUE _8

ARENCORES A

C H A N I A

R E A L

E S T A T E

M A R K E T

M A G A Z I N E

P U B L I C A T I O N

D E D I C A T E D

T O

P R O P E R T Y

PROPE RTY I N VE STORS VI EW DU RI NG THE PA NDE MI C W HAT A RE YOU R TO P FOU R C OC E RNS?

CO MMERC IA L REA L E STAT E I N CR ETE MUS T SEE C O RON AV IRUS C RI SI S A S A C HA NC E TO A DA PT A N D RE NEW

H O W C O N S T RU CT I O N S E CTO R I N C H A N I A H A S CH A N GE D S I N C E CO RO N AV I RU S S T RU C K

A

MAGAZINE

GREECE’S CORONAVIRUS MANAGEMENT SUCCESS

IMPRESS FOREIGN REAL ESTATE INVESTORS REAL ESTATE RECESSION? NOT SO FAST AND NOT FOR ALL PROPERTY TYPES HAVE GOLDEN VISA PROGRAMS LOST THEIR POPULARITY?

B U Y E R S

&

I N V E S T O R S


At ARENCORES & Chania Real Estate we don’t just sell properties. We want to see real meaning and problem solving that resonates.


M AR I A GK IK A MANAGING DIRECTOR - FOUNDER

This issue of ARENCORES Magazine comes at a time of significant economic and societal disruption because of the pandemic crisis. Much has been written about how Covid-19 will reshape travel, tourism and retail in the island of Crete. Less has been said about what it will mean for the local real estate market. How the uncertainties associated with the pandemic will epitomize the excess that may lead to a deeper recession? How the local and foreign investors think about of what is still to come - namely a long period of falling property prices? At the moment, the extent to which this health crisis will affect the real estate market is unknown. Nonetheless, real estate market is a dynamic sector and in Chania the sector is still very competitive but there may be more to it than meets the eye. According to a recent survey by ARENCORES and Chania Real Estate, property buyers shouldn’t expect any big discounts for residential and commercial properties in Crete, Greece in the coming months. Just because there’s a large number of people filing for unemployment doesn’t mean we’re going to have the same foreclosure crisis in the property market that we saw between 2009-2015. Indeed, our survey found that the majority of our property owners (89%) have not reduced listing prices to attract buyers. Meanwhile, property sellers must value their real estate assets in a reliable and pragmatic way that should represent a fair price. As real estate and construction professionals we have already seen that properties are still selling and their owners are selling for full list price when a property is priced fairly. However, fair value differs depending on willingness of the property owners to accept the pragmatic value of their real estate assets and the methodology or the procedures of the appraisal. During this difficult period of time for our societies, we need to rethink both real estate investment strategies, property construction and management. Chania is an attractive target market for foreign investors. There is a plethora of evidences confirming that capital movements and investment financing follow the city attractiveness. Such areas - like Chania - suggesting a “ low risk market” and accelerate the return of investment potential (ROI).

ARENCORES CHANIA REAL ESTATE MAGAZINE


i n d e x

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IMPACT ON THE CONSTRUCTION ACTIVITY IN CRETE

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HOW CONSTRUCTION SECTOR IN CHANIA HAS CHANGED SINCE CORONAVIRUS STRUCK

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PROPERTY INVESTORS VIEW DURING THE PANDEMIC: WHAT ARE YOUR TOP FOUR COCERNS?

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PANDEMIC COULD MEAN OPPORTUNITY FOR REAL ESTATE INVESTORS

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SELECTED PROPERTIES FOR SALE IN CHANIA, CRETE

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CRETAN CHEESE MAKING IN THE WHITE MOUNTAINS

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HAVE GOLDEN VISA PROGRAMS LOST THEIR POPULARITY?

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COMMERCIAL REAL ESTATE IN CRETE MUST SEE CORONAVIRUS CRISIS AS A CHANCE TO ADAPT AND RENEW

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REAL ESTATE RECESSION? NOT SO FAST AND NOT FOR ALL PROPERTY TYPES

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GREECE’S CORONAVIRUS MANAGEMENT SUCCESS IMPRESS FOREIGN REAL ESTATE INVESTORS

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All investment and or financial opinions expressed within ARENCORES MAGAZINE are based on the personal research and experience of ARENCORES’ editorial team, as well as on surveys conducted within or associated with the Greek real estate sector. The content of ARENCORES MAGAZINE is intended to be used, and must be used, for informational and educational purposes only. You must take independent financial and/or any other professional advice from an expert and/or a professional, and/or you must make independent research and verify any information that you find within ARENCORES MAGAZINE and wish to rely upon, whether for the purpose of making an investment decision or otherwise. Although best efforts are made to ensure that all information is accurate and up to date, unintended errors and/ or misprints and/or omissions may occur. The producer of ARENCORES MAGAZINE shall not be held responsible for any such errors and/or misprints and/or omissions. The producer of ARENCORES MAGAZINE shall not, in any circumstances (a) be legally bound as a result of any information contained in this guide or (b) be held responsible for any losses or liabilities that may arise in respect of such information or for any use of such information by any such person.

I M PA C T O N T H E C O N S T R U CTION ACTIVITY IN CRETE

H O W C O N S T RU T I O N S E C TO R IN CHANIA HAS CHANGED S I N C E C O R O N AV I R U S S T R U C K

P RO P E RT Y I N V E S TO R S V I E W D U R I N G T H E PA N D E M I C : W H AT A R E YO U R TO P F O U R COCERNS?

The significantly large drop in bookings and

We examine a real, live project to outline

As we move forward into this uncharted

decline of interest for properties and new

the impact that the COVID-19 pandemic is

territory, the responses to the crisis should

commercial and residential projects are just

having on the construction activity in Chania,

be founded on the basis that will establish

two parameters behind the current crisis, the

Crete.

systemic integrity and economic viability.

PA N D E M I C C O U L D M E A N O P P O RT U N I T Y F O R R E A L E S TAT E I N V E S TO R S

C R E TA N C H E E S E M A K I N G I N T H E W H I T E M O U N TA I N S

C O M M E R C I A L R E A L E S TAT E I N C R E T E M U S T S E E C O R O N AV I RU S C R I S I S A S A C H A N C E TO ADAPT AND RENEW

One of the most effective real estate invest-

Greek mythology describes that the sky and

In a matter of weeks, the lives of so many

ing strategies during these times is searching

thunder god Zeus, the king of the gods of

have changed in ways they had never

and identifying properties with a great

Mount Olympus was raised in a cave deep

imagined some months ago. In Greece and

chance for appreciation over the long term

inside the Cretan mountains having as com-

globally, people can no longer meet, work,

and with high Return of Investment potential

panion a divine goat named Amalthea.

eat, shop, and socialize as they used to.

other and most crucial being the ongoing uncertainty.

(ROI.

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IMAGE SOURC E: UNSPLASH

The significantly large drop in bookings and decline of interest for properties and new commercial and residential projects are just two parameters behind the current crisis, the other and most crucial being the ongoing uncertainty. The plunge is putting Crete’s tourism industry, real estate investments and construction activity at risk. Moreover, the health and safety risks of COVID-19 vary from project to project and to comply with the new health and safety precautions requires sinergistic relations with medical, scientific and government guidelines to provide a safe working environment.

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IMPACT ON THE CONSTRUCTION ACTIVITY IN CRETE IM AG E S OU RC E: U NSP LASH

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The pandemic has dramatically impacted a number

most every year.

of sectors in both at home and around the world. The

As much a tragedy as the coronavirus is, most big cities

coronavirus pandemic is striking Crete where it hurts:

in Greece are dealing with one problem, Chania is deal-

in the tourism, construction and real estate sector.

ing with two because we’re dealing with coronavirus and the dramatic drop in the construction activity - that

The government of Kiriakos Mitsotakis under the guid-

according to several research and surveys - would be

ance of an experienced team of epidemiologists and

far more painful than the recession that we faced be-

medical scientists has successfully implemented some

fore ten years.

of the most proactively restrictive measures in Europe, which seem to be working.

Although activity in the construction sector will likely continue in Chania, Crete, some projects are expected

To date Greece counts just 144 deaths since the start of

to halt soon given various factors including bottlenecks

the outbreak. By contrast, Switzerland, which has a sim-

on the supply chain and the termination or cancellation

ilar population, just below 9 million, has recorded 1,467

of contracts from the owners to control expenses – es-

deaths and Belgium with a population of 10 million has

pecially for small and medium residential projects.

recorder 7,765 deaths. Cretans are sticking inside and for three weeks in a row no case of the virus has been

Moreover, many new projects at the design and plan-

reported on the entire island.

ning phase have even stopped, usually with the intention to resume work at a later date. For large-scale

The hospitality sector, along with travel, tourism, real

infrastructure projects across Crete, we have seen a

estate and construction, has been hit by Covid-19.

number of redundancies and cost cutting measures

With COVID-19 and its deleterious effects the island of

being implemented from the investors because of the

Crete hold its breath. Decreases in bookings and high

unprecedented economic events and market volatility.

cancellation volumes are the direct effects of the virus. Especially now, it is clear that our sector need to have a

8

The significantly large drop in bookings and decline of

clear and synergistic engagement strategy to begin di-

interest for properties andnew commercial and res-

alogue with investors, suppliers and banks to deal with

idential projects are just two parameters behind the

the crisis and its future impacts on our business and

current crisis, the other and most crucial being the on-

economy as a holistic approach to predict and manage

going uncertainty. And it’s not good news for a state

the systemic threats to our common goals and objec-

that welcomes more more than 1,580,000 people al-

tives.

ARENCORES CHANIA REAL ESTATE MAGAZINE


‘‘At the time of writing, the majority of our construction sites in Akrotiri, Kisamos, and Apokoronas have maintained the status quo with low impact so far. We have not experienced of any significant defaults on progress payments or cancellation of contracts in progress so far.’

IMAGE SOURC E: UNSPLAS H

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HOW CONSTRUTION SECTOR IN CHANIA HAS CHANGED SINCE CORONAVIRUS STRUCK

I M AGE SO U RCE: UNSPLASH

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We examine a real, live project to outline the impact that the COVID-19 pandemic is having on the construction activity in Chania, Crete. Unlike sectors like architectural design, manufacturing,

the construction site. Many of them may have returned

IT or financial services, the sector of construction and

to their villages or are planning to do so.

its ancillary engineering segment require the physical presence of workforce – both skilled and less skilled – in

Moreover, contractors are also not keen on pushing

different phases of the project life-cycle.

them either because the safety and health of all those who work in construction remains the top priority for all

Civil engineers, mechanical engineers, energy engi-

the parties involved. Most of the construction sites are

neers, contractors and workers are just some of the

running at just half of our usual run rate as fear about

most frequent people in the workforce required in a

the infection is keeping workers’ attendance at less than

construction project.

60 percent. ARENCOS provides all the necessary support to workers, from undertaking precautionary meas-

Unfortunately, the significantly low integration of novel

ures such as avoiding group formation, provides face

technologies and applications along with the absence

masks etc.

of state-ofthe art digitalization and automation tools in such projects is a critical barrier.

Supply Chain Status: Some of the required materials to complete the project are being sourced from over-

These impacts include, among others, schedule delays,

seas (Germany, China), which are either in manufactur-

workforce availability, equipment and material disrup-

ing or dispatch phase. The time of delivery of such mate-

tions, reduced productivity due to on site health and

rials should also significantly affect the time of project

safety measures (e.g., social distancing, etc.), permit de-

completion.

lays and cash flow shortages.

Contractual Impact: Some of the sellers and material Project Status: Advanced Construction Stage Project Location: Akrotiri, Chania, Crete, Greece

suppliers may invoke claims due to COVID-19 and this will inevitably lead to contractors’ claims for additional time and costs.

Project Cost: 500.000 euro Investor’s Origin: EU

Project Schedule Impact: Prognosis for 2 months delay under some pessimistic scenarios. The interconnect-

Labour Deployment: Over 30 workers with over 10

edness and synergistic nature of a construction project

different pieces of heavy equipment or heavy machin-

along with the bottleneck phenomena in the supply

ery.

chain and physical distancing of the workforce should

Labor deployment is the ability to use the correct

also affect the time schedule of the project.

amount of staff, in the right place, at the right time. It allows you to bring all of your resources into effective ac-

Any slowdown across the project life-cycle due to the

tion. This means you get the correct staff for the job and

pandemic or even the limited sources for financing from

you have enough people to make the most profit during

the side of the project owner could cause further delays

peak times and all hours.

or changes.

Labour Status: Because of the social distance measures more than 40 per cent of the construction workers required to complete the project are staying away from

Cost Impact: No impact on the total project cost. The cost remains the same as it was initially agreed between the client and ARENCOS.

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WHAT ARE YOUR TOP FOUR COCERNS? PROPERTY INVESTORS VIEW DURING THE PANDEMIC

A SURVEY D E D I C AT E D TO C H A N I A PROJECT OWNERS, R E A L E S TAT E I N V E S TO R S C O N T R A CTO R S A N D C O N S T R U CTION COMPA N I E S .

IMAGE SOURC E: UNSPLASH

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For Greece, unlike the 2009 finan-

the construction sector of Crete.

cial crisis which was caused by a

Greece.

dramatic breakdown in the banking and credit system of the country,

For the initial survey analysis, we

this unprecedented and multidi-

shared responses from our con-

rectional crisis is instead a result of

tractors and subcontractors in our

a global disruption in commercial

first brief. In the next iteration, we

activity.

released the second brief, comparing the project managers response

As we move forward into this un-

from the first brief with the new

charted territory, the responses to

survey responses from investors

the crisis should be founded on the

and stakeholders.

basis that will establish systemic integrity and economic viability. The COVID-19 pandemic – and its associated risks and uncertainties – is a serious threat not only to global health, but to our local societies, our economies and our investments.

How to deal with a situation like this, a massive outbreak, would catch anyone off guard but through our synergistic relations, open dialogue and a communal framework about our investment continual operations and risk management, I feel as though I’m better suited to deal with a similar situation if it were to ever happen. Mark Lewis - Property Investor in Chania, Crete, Greece

We feel it’s important to ask project managers, investors, and stakeholders what are the top concerns about the pandemic and its impacts on our sector. We surveyed nearly 50 project managers, contractors and investors currently involved in

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SURVEY OUTLINES

17%

ARE YOU EXPERIENCING ANY D I S R U P T I O N I N T H E S U P P LY O F YO U R M AT E R I A L S O R S E R VICES FOR YOUR CURRENT PROJECTS IN CRETE?

14%

Some construction projects in Crete have been delayed, and a small number of projects on the tourism sector canceled, as a result 22%

of the impacts of COVID-19. In addition, the majority of the respondents (53%) in this survey indicated possible supply chain bottle-

47%

necks of equipment and materials.

Yes, we are seeing severe disruptions No disruptions Yes, but only small in scale disruptions No, but we anticipate some extend of disruptions for the following months

ARE YOU EXPERIENCING ANY D I S R U P T I O N I N T H E S U P P LY O F YO U R M AT E R I A L S O R S E R VICES FOR YOUR CURRENT PROJECTS IN CRETE?

12%

10% 47% of the survey respondents appear cautiously optimistic saying that no critical

Yes, we are seeing severe disruptions supply chain disruptions are on the horizon. No disruptions

The high level of optimism of respondents

Crete is confirmed by the result that 78% 78%Yes, but only small in scaleindisruptions stated that they will continue to do a ‘busi-

No, but we anticipate some extend of disruptions for the following months No

ness as usual’.

Yes, one or two projects wel be cancelled Yes, but we will continue our investments after the end of the pandemic

Overall, impacts of the Covid-19 on the construction activity in Crete are tough to judge thus far; mostly investors, project managers and contractors are anticipating no dramatic The COVID-19 pandemic and its associated effect on the economic activity is presenting a plethora of challenges to the engineering and construction sector — challenges that could deepen depending on the severity and duration of the crisis in Greece and globally.

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ESTATE MAGAZINE

slowdowns and project pause.


Less property will be coming onto

and with high Return of Investment

the market in the coming months.

potential (ROI).

In a downturned market, property THE CURRENT C O R O N AV I R U S S I T U AT I O N HAS A LOT OF BUYERS, SELLERS AND R E A L- E S TAT E AGENTS WORRIED ABOUT W H AT W I L L TRANSPIRE IN THE PROPERTY MARKET IN THE COMING MONTHS AND YEARS.

owners who are not desperate to

However, one may wonder: Is buy-

sell have no incentive to list their

ing a property during a worldwide

properties.

pandemic a smart decision? For some residential and commercial

They will get less than they could

properties in Chania, Crete interest

have a few months ago, and the

rates are low this period of time.

best thing to do is to hold the prop-

BUT have we hit bottom yet?

erty for a few more months or years and sell it once the market slightly

Because of the nature of the un-

recovers.

certainty that this crisis produces, it would be safe to say that we just

Sometimes, investing during a re-

don’t know. Some areas are seeing

cession can be the best time to buy

medium to high property requests

a property. Moreover, in a small real

today while others have slowed

estate market like Chania property

down during these volatile times.

market, Crete there isn’t as much

PANDEMIC COULD MEAN OPPORTUNITY FOR REAL ESTATE INVESTORS

Yet, it’s important to note that single-family rentals in the area of Akrotiri and Chania town appear to generate positive signs to investors. That’s primarily because students of the Technical University of Crete are always going to need a place to live, even during times of recession. Yet, another reason so many investors consider real estate investment in Chania town to be a safe haven, is the tourism industry which is expected to grow significantly and may enjoy the biggest rally ever when the pandemic is over. A wise strategy that can captures

competition from other property

the essence of many of the usefully-

buyers or investors.

systematic ways to acquire a property is to look for the most domi-

One of the most effective real es-

nant market trends of a particular

tate investing strategies during

area and invest there.

these times is searching and identifying properties with a great chance for appreciation over the long term

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Therefore, the question arises which housing market indicators should we be paying attention to during a recession? ARENCORES real estate development and property management firm prioritizes the most significant indicators of the commercial and residential real estate market of Chania and Rethymon and facilitates your decision making by providing you reliable and trustworthy information for the area of your interest. An example would be Chania Old Town, an area already experiencing strong demand for properties from Israelis, Germans, Americans and Russians. The properties in this area are still very expensive – even today, so it’s difficult for most people to buy real estate in these areas – especially properties that cash flows. However, some properties in Platanias, Apokoronas and Kissamos may experience a small dip, but will likely be quick to recover.

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ARENCORES CHANIA REAL ESTATE MAGAZINE

IMAGE SOURCE : UN S P L A S H


ARENCOS ARCHITECTURE ENGINEERING AND CONSTRUCTION SERVICES 26 Stratigou Tzanakaki Street 73134, Chania, Crete, Greece T: + 3 0 2 8 2 1 1 1 2 7 7 7 W:www.arencos.com E: info@arencos.com

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K A L AT H A S WAT E R F R O N T B U I L D I N G P L OT F O R S A L E 450.000 E U R O

Property Type: Building Plot Tenure: Freehold

Plot Size: 1218.00 m² Builds: >400.00 m² Views: Sea Views

Access: Asphalt Road

A RARE AND UNIQUE OPPORTUNITY TO OWN A SEAFRONT PLOT OF 1218.00 SQ.M. IN THE AREA OF AKROTIRI, NORTH EAST CHANIA. IF YOU ARE LOOKING FOR ABSOLUTE PRIVACY, PEACE AND TRANQUILITY AS WELL AS STUNNING AND UNINTERRUPTED SEA AND COASTAL VIEWS THEN THIS IS A NOT-TO-BE MISSED OPPORTUNITY.

Reference ID: PC0612

View the property or discover more info on-line: https://www.arencores.com/property/kalathas-waterfront-plot-for-sale/

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PA L A I O C H O R A I N V E S T M E N T P L OT F O R S A L E REQUEST MORE INFO pa l a i oc ho r a @ a r e n co r e s . co m

Property Type: Investment Plot Tenure: Freehold

Plot Size: 185.000.00 m² Reference ID: PC0876

Classi fi ed as h av i n g ou t s t a n d i n g v a l u e a n d with ver y h i gh Re tu rn o f I n v e s t m e n t p o t e ntia l (ROI) t h i s i s a n ot t o b e m i s s e d o p p o rtun i ty. The pro pe rty i s l o c a t e d 1 0 . 0 0 km west of Pa l ai oc h ora, C h a n i a . T he pr ope rt y h ol ds an o f f i c i a l l i c e n s e f o r to u r i sti c de v e l o pm e n t ( u p t o 1 5 0 b e d s ) and a l so h o l ds F o re st a n d A r c h a e o l o g i c a l clear ance.

View the property or discover more info on-line: https://www. arencores.com/property/palaiochora-investment-plot-for-sale/

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ARENCORES CHANIA REAL ESTATE MAGAZINE


MEGALA CHORAFIA BUILDING PLOT FOR SALE - APTERA, CHANIA 3 2 0 .0 0 0 E U R O

Locality: Suburb

Property Type: Building Plot Tenure: Freehold

Size: 1800.00 sq.m.

Builds: 400.00 sq.m. Max Floo rs: 2

Reference ID: PC0107

View the property or discover more info on-line: https:// www.arencores.com/property/megala-chorafia-plot-an-exquisite-piece-of-land-near-chania/

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THIS 1800.00 SQ.M. EXQUISITE PIECE OF LAND IS LOCATED IN ONE OF THE MOST BEAUTIFUL AREAS OF CHANIA MUNICIPALITY. THE PROPERTY PROVIDES SPECTACULAR VIEWS TO THE SOUDA BAY AND THE WHITE MOUNTAINS YOU COULD EASILY BUILD A RESIDENTIAL OR INVESTMENT PROPERTY UP TO 400.00 SQ.M. TO CALL YOUR OWN. A NOT TO BE MISSED OPPORTUNITY TO OWN A GREAT REAL ESTATE ASSET IN THE ONE OF THE MOST ELEGANT TOWNS IN GREECE.


ALMYRIDA FOUR MAISONETTES FOR SALE - AN INVESTMENT PROPERTY 400.000 E U R O

Locality: Residential

Property Type: Maisonette-Commercial Basement: 169.34 m²

Ground Floor: 160.00 m² First Floor: 131.00 m² Plot Size: 427.50 m²

Swimming Pool: 32.00 m² Reference ID: CC1900

View the property or discover more info on-line: https:// www.arencores.com/property/almyrida-four-maisonettes-for-sale-apokoronas-properties/

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ESTATE MAGAZINE


K O U R N A S T W O S TO R E Y MAISONETTE FOR SALE 180.000 E U R O

Locality: Residential

Property Type: Family House Property Size: 80.00 m² Plot Size: 224.00 m² Bedrooms: 2

Reference ID: HC1801

LOVELY TWO LEVELS 80.00 SQ.M. HOUSE WITH VIEWS OF THE LOCAL HILLS AND COUNTRYSIDE OF KOURNAS, CHANIA. FULL OF CHARM AND CHARACTER, THIS PROPERTY ALSO OFFERS STUNNING INVESTMENT PROSPECTS. A NOT TO BE MISSED OFFER IN CLOSE PROXIMITY TO THE LAKE AND ALL AMENITIES.

View the property or discover more info on-line: https://www. arencores.com/property/kournas-house-for-sale/

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ESTATE MAGAZINE


A RARE CHRISSI AKTI P L OT F O R S A L E 2 5 0 .0 0 0 E U R O

Locality: Residential

Property Type: Building Plot Tenure: Freehold Size: 234.00 m²

Builds: 240.00 m² Gradience: Slope

Reference ID: PC0402

THIS WONDERFUL CHRISI AKTI PLOT FOR SALE OF 234.00 m² IS SITUATED IN THE SOUGHT AFTER AND PRESTIGIOUS AREA OF NEA KYDONIA, NORTH WEST OF CHANIA. THE PROPERTY BOASTS WONDERFUL SEA AND MAINLAND VIEWS AND IS A SUPERB OPPORTUNITY TO PURCHASE LAND FOR YOUR HOLIDAY HOME OR AS AN INVESTMENT PROJECT IN THIS THRIVING AREA.

View the property or discover more info on-line: https://www. arencores.com/property/chrisi-akti-plot-for-sale/

ARENCORES CHANIA REAL ESTATE MAGAZINE

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IMAG E S S O URCE : U NSP LASH

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I MAGE SO U RCE: UNSPLASH

CRETAN CHEESE MAKING IN THE WHITE MOUNTAINS Greek mythology describes that the sky and thunder

Kronos swallowed the stone, not suspecting anything, so

god Zeus, the king of the gods of Mount Olympus was

the kid had to hide. Rhea hid him on the island of Crete

raised in a cave deep inside the Cretan mountains hav-

in the cave of Mount Ida in the area of Ideon Antron. The

ing as companion a divine goat named Amalthea who

goat Amalthea saved the life of the future supreme god.

fed the baby Zeus with its milk. She produced two goatlings and fed Zeus with the abunIts name is translated from the ancient Greek and means

dant milk that appeared. Moreover, Amalthea hung on a

“gentle goddess.” Zeus’ father, inherited his father’s

tree baby Zeus in a cradle so that he could not be found

curs¬e: for fear of losing his place and rule, swallowed

either on the ground, or in the sky, or in the sea, when

up all his newly born children. His wife Rhea suffered

Kronos was looking for him.

greatly from this, and when the next child was born, she slipped a stone wrapped in diapers instead of Kronos.

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ARENCORES CHANIA REAL ESTATE MAGAZINE


A M A LT H E I A’ S S K I N , O R T H AT O F H E R G O AT, TA K EN BY ZEUS IN HONOR OF HER WHEN SHE DIED, BECAME THE PROTECTIVE AEGIS IN SOME TRADId Zeus, the king of the gods of Mount Olympus was raised in a cave deep inside the Cretan mountains havTIONS. ing as companion a divine goat named Amalthea who fed the baby Zeus with its milk. Its name is translated from the ancient Greek and means “gentle goddess.” Zeus’ father, inherited his fa-

Infancy of Zeus, by Jacob Jordaens, early 1630s (Louvre Museum)

ther’s fear I M AG E SO Ucurs¬e: RCE: W I K for I P EDI A

of losing his place and rule, swallowed up all his newly born children. His wife Rhea

T H E child B I R was TH O F A she G Aslipped STRON O M Y wrapped in diapers insuffered greatly from this, and when the next born, a stone

Zeus wasofvery fond of his goat-saver and stead Kronos.

TREASURE IN CRETE

Amalthea from a golden dog High Kronos received swallowed thehim stone, not suspecting anything, so the kid had to hide. Rhea hid him the island of sheep and goats for up in the Cretan mountains, shepas aoncage to gather who guarded until her death. Crete in theher cave of Mount Ida inMorethe areaherds of Ideon The goat saved the life of the future andAntron. goatherds take Amalthea the milk from milking. Made of nothing but stone on over, accidentally supreme god. broken goat’s horn be-

their flocks straight to the cauldron in the

stone, the mitata continue to stand on

came a cornucopia.

mitata.

the mountain rock as examples of perfect

She produced two goatlings and fed Zeus with the abundant milk that appeared. Moreover, Amalthea hung vernacular architecture – modest, sturThe legend of the goat Amalthea became

Mitata is the Cretan name for the basic

dy and functional in the extreme. Larger,

the source of the phraseologism from

shepherds’ dwellings built high up on the

squarer stones were placed at the bottom

the myths of ancient Greece, where the

slopes in the mountains and, since one

in a circle, with the stones at the top being

“cornucopia” term is used. The one who

of their primary uses is to store and age

carved into shape.

held the cornucopia in his hands could get

cheese, they’re often considered to be the

everything he wanted

earliest form of dairies in Greece.

The structures became narrower as they grew taller, much like an igloo, in order to

The goat served Zeus even after her death.

These stone-built structures symbolize

stand the weight of the winter snow. The

The god used her unusually strong skin

the very initial stage of what later grew

gaps between the stones were deliberate-

(according to the ancient Greek aegis) for

into a great tradition of dairy farming in

ly not filled in with clay or any other mate-

the shield during the war with the titans.

Crete.

rial, in order to allow air to pass through

Covering his shield with Amalthea’s skin,

the walls to dry out the cheese, maturing

Zeus made him invincible, and under the

Being so remote, the mitata were also

aegis of his shield he began to fight with

used as hideouts during the Ottoman

the titans. Thus, another popular expres-

occupation; during the Second World

A small window – like a skylight – was

sion “under the auspices” appeared.

War, they provided cover for resistance

left at the top of the dome, where spiders

fighters. These shelters, built of local-

would be able to weave a nice thick web,

ly-sourced stones and shaped like Minoan

catching flies and other insects and keep-

tholos tombs, have entrances that face

ing them away from the cheese: a brilliant

due east and, they are unique to Crete.

example of man and insect working to-

it in the process.

gether in symbiosis. Each one was surrounded by a drystone wall about 1.5m high, which was used ARENCORES CHANIA REAL ESTATE MAGAZINE

26


I M AG E SO U RCE: ANO GEI AMUNIC IPALITY (www. anogeia. gr)

Some of the shelters had two domes or

Since there were no laws mandating

Over the years, the old-fashioned caul-

two rooms to separate the processes

the use of pasteurized milk in the past,

drons, or kazania, which were used to

of preparation and ageing. Standard

the cheeses that came out of these

heat milk, have also fallen into disuse.

items and utensils found here includ-

traditional dairies were quite harsh in

New food safety laws have changed

ed the toupakia (straw baskets used as

taste, with relatively intense and ag-

production processes, and, as a result,

molds for fresh cheese); pots and ladles

gressive flavors.

have also changed the recipes them-

for the cheesemaking itself; a pan or a

selves. Crete’s cheeses are now made

pot where the shepherds would cook

“Hole cheeses,” made with unpasteur-

in modern facilities with pasteurized

their food; a katsouna (shepherd’s

ized milk, are particularly treasured, so

milk heated to exact temperatures in

crook) and some rudimentary form of

called because the natural fermenta-

stainless steel containers.

bedding.

tion process and lengthy ageing create large holes in their surface.

Some would have family photographs

Although the method of production has been modernized, the cheeses of Crete

on the walls to keep them company and

Most of Crete’s surviving mitata have

remain very special indeed. More than

to add a note of joy to their otherwise

been around for at least several dec-

15 different types can be found on the

drab surroundings.

ades. Many of them have been aban-

island today, but all of them share a

doned and no one is building new ones

common history of production that be-

Coming straight from the udder, the

anymore, as developments in transpor-

gan in cauldrons bubbling away in the

milk was already warm when it was

tation allow shepherds to live in their

island’s mitata.

poured into the hot cauldron and treat-

villages or towns and dart up to the

ed with rennet, an enzyme found in the

pasturelands whenever the need aris-

stomachs of young ruminants that al-

es.

lows them to digest milk.

27

I MAG E S O URCE : S H UTE R S TO CK

ARENCORES CHANIA REAL ESTATE MAGAZINE

DISCOVER MORE INFO ABOUT THIS FASCINATING STORY AT GREECE IS ON-LINE: https://www.greece-is.com/mitata-the-origins-of-cretan-cheesemaking/


H AV E GOLDEN VISA PROGRAMS LOST THEIR POPULARITY?

There are growing concerns about the practice of handing out passports and visas to wealthy foreigners in return for property investment. Yet some claim the risks have been exaggerated.

States that operate them. Brussels says it intends to monitor the steps that Member States take to ensure transparency and good governance in the implementation of the schemes, and will establish a group of experts to deal with issues of transparency, governance and security.

In January 2019, the European Commission (EC) called for EU Member States to curb the practice of giving foreigners residency or citizenship in return for investment. Several European countries offer such programmes, often referred to as ‘golden visas’ or ‘golden passports’. Such schemes ‘pose risks… including in terms of security, money laundering, corruption, circumvention of EU rules and tax evasion,’ the EC report says. Heightening these risks are shortcomings in the transparency and governance of such schemes, the EC says. Key information, such as clear statistics on applications received, accepted and rejected, are often missing or incomplete.

‘Legally residing in the EU and in the Schengen Area comes with rights and privileges that should not be abused,’ said European Commissioner Dimitris Avramopoulos. ‘Member States must at all times fully respect and apply existing obligatory checks and balances – and national investor residence schemes should not be exempt from that.’ These schemes became increasingly attractive to many European countries in the wake of the 2007–2008 global financial crisis. Originally designed for Caribbean countries, they emerged as a way for governments to attract quick investment, often in their property markets. In some cases, the funds go straight into state coffers.

There are no mechanisms to ensure cooperation on golden passport schemes (those offering citizenship) – notably on security checks – among the EU Member

ARENCORES CHANIA REAL ESTATE MAGAZINE

28


Research from Global Witness and Transparency Inter-

‘I agree with every word of its report; I just wonder why it

national suggests the EU’s 28 Member States have se-

hasn’t been done before, since the problem has been known

cured about €25bn of foreign direct investment through

about for years.’

these schemes over the past ten years. Revenues from golden visa schemes globally are estimated to be $13bn

If the Commission had made its position clear sooner,

a year, about $3bn of which is accounted for by schemes

then fewer Member States would have started these

that offer citizenship.

schemes in the first place, he says. ‘Still, it is never too late. I only hope that all EU countries will accept the report

The key concern is that EU passports and residency are

and start acting according to its conclusions as soon as

being granted to people who should not be receiving

possible.’

them. In September 2018, for example, police in Finland raided a real estate agency at the centre of a suspected

The European Parliament’s Special Committee on Fi-

€10m money laundering operation controlled by a Rus-

nancial Crimes and Tax Evasion released a draft report

sian businessman who reportedly purchased Maltese

in November 2018 that called on EU Member States to

citizenship. In addition, two Ukrainian businessmen who

phase out all such schemes. Their potential economic

were granted citizenship by Cyprus turned out to have

benefits ‘do not offset the serious money laundering

extracted €4.8bn from a bank they founded together in

and tax evasion risks they present,’ said the report,

Ukraine.

which focused in particular on Malta’s Individual Investor Programme.

Bulgaria, Greece, Hungary, Latvia, Lithuania and Portugal have been singled out as examples of EU Member States that have assigned residency rights to significant numbers of wealthy Africans, Chinese and Russians in exchange for investment in recent years. ‘If you have a lot of money that you acquired through dubious means, securing a new place to call home far away from the place you stole from isn’t just appealing, it’s sensible,’ says Naomi Hirst, Senior Campaigner at Global Witness. These schemes offer a safe haven from authorities who might be looking to seize stolen assets, and the freedom to travel without raising suspicion. In the words of one Russian lawyer speaking to British author Oliver Bullough: ‘Your money is offshore already and, once you have a new passport, you are effectively offshore yourself, beyond the reach of your home country’s law enforcement.’

QUICK ACTION IS REQUIRED Against this backdrop, the Commission has to act. ‘The Commission has finally decided to ensure that its rules are respected,’ says Drago Kos, Chair of the Organisation for Economic Co-operation and Development (OECD) Working Group on Bribery in International Business Transactions.

29

ARENCORES CHANIA REAL ESTATE MAGAZINE


GREECE IS GAINING A STRONGER BRAND NAME, WHICH CAN WORK P O S I T I V E LY I N AT T R A C T I N G PROPERTY I N V E S TO R S

COMMERCIAL REAL ESTATE IN CRETE MUST SEE CORONAVIRUS CRISIS AS A CHANCE TO ADAPT AND RENEW T H E G LO B A L L AT E S T T R E N D S A N D T H E I R I N F L U E N C E I N T H E COMMERCIAL PROPERTY MARKET OF CHANIA, CRETE. In a matter of weeks, the lives of so many have changed in ways they had never imagined some months ago. In Greece and globally, people can no longer meet, work, eat, shop, and socialize as they used to. The workforce of almost every sector moved rapidly from business as usual to social-distancing and work-from-home. Instead of traveling and going out to shop or eat at restaurants, consumers are tightening their purse strings to spend only on essentials—primarily food, medicine, and home supplies—and getting these delivered on their door steps much more often.

ARENCORES CHANIA REAL ESTATE MAGAZINE

30



Social distancing has directly altered the way people

the same way during the crisis. Properties with large hu-

live and interact. The pandemic and its associated ef-

man density seem to have been the hardest hit: health-

fects produced an unprecedented uncertainty for the

care facilities, shopping malls, tourism accommodation,

real estate sector.

and student housing are among the most popular.

To respond to the current and urgent threat of COV-

By contrast industrial facilities and small offices have

ID-19, many real estate investors will centralize cash

faced lower impact. As of May 28, by one estimate, the

management to focus on flexibility and change how

commercial real estate transactions had fallen 38 per-

they make portfolio and capital expenditure decisions.

cent or more and as much as 45 percent for tourism

Some investors will feel an even greater sense of urgen-

real estate assets. It’s no surprise that in order to mit-

cy than before to proceed to the transformation of their

igate the scale and severity of the virus - people avoid

decision making, strategic approach and viable assets

crowds, universities postpone their activities on cam-

identification.

pus, and retailers, restaurants, and hotels close their doors. Thus, the economic viability of owning and oper-

Moreover, as the pandemic affects commercial real es-

ating those properties becomes very doubtful.

tate it is crucial to establish new methods and prioritize novel approaches that should protect the safety and health of all employees, tenants, and other end users of space such as hotel tenants. The most intelligent real estate investors and property managers are also trying to generate a reliable prognosis about the future of the sector in the following years.

THE CHALLENGE BEHIND THE C R I S I S W E A R E FA C I N G For several years, real estate investments in Crete, Greece have generated steady cash flow and returns significantly above other sources of investments — such as Direct equity, National Pension System (NPS) or Bank fixed deposit (FD) —with only slightly more risk. Since the virus outbreak, however, this reality has changed, and real estate investors have been hit hard. Property construction investors, owners, building contractors and managers are struggling to mitigate health risks for their employees and customers.

THE CHALLENGE BEHIND THE C R I S I S W E A R E FA C I N G

Many developers can’t acquire the necessary building permits and they face project delays, bottlenecks, and

Commercial real estate owners and investors should

potentially reduction on the return of Investment rates.

also keep one eye on a future that could be meaningful-

Moreover, because of the lockdown, many real estate

ly different to ensure their long-term profitability. The

assets owners and operators face drastically reduced

demand for more physical space and more-intensive

operating income, and almost all are worried about

operational requirements are likely to be among the

how many tenants will manage to make their monthly

most dominated parameters for any future investment.

payments.

Consequently, these trends should also influence the demand for hospitality properties and short-term leas-

However, not all commercial properties are performing

es.

ARENCORES CHANIA REAL ESTATE MAGAZINE

32


Even a small shift to property digitalization could have

The drop in June and even in July is certain to be even

lasting impact when alternatives such as video confer-

more dramatic. But what will the commercial real

ences prove sufficient or even preferable.

estate market recovery look like in Crete, Greece once the pandemic passes and the Greek economy reaches

When thinking about digital transformation, it’s not

its new state of normal?

limited to creating a video conference room, an on-line shop or implementing artificial intelligence and virtual

Currently, commercial property owners and leading

reality in your business.

real estate companies around the world are working hard to improve the ways of attracting tenants, improve

The shift to a digitalization era may also further boost

the commercial lease negotiation procedures, establish

already high demands for large business space. Rela-

reliable and trustworthy valuation for their assets, and

tively niche real estate assets (such as self-storage and

improve their digitization infrastructure with much

delivery only restaurants - cloud kitchens) could see an

emphasis on the health and safety in physical spaces.

improvement in their profitability, as demand density goes up when more people work from home, while oth-

However, at the same time they need to bridge the gap

er categories such as cafes, old hotels, fashion shops,

between capital preservation and competitive differ-

cinemas, theatres, etc may suffer.

entiation.

Cloud Kitchens offers services ranging from shared kitchen facilities to food delivery service and marketing aids. Such business model of a cloud kitchen, also known as a virtual kitchen, has become the latest buzzword among restaurant operators who would like to cut down costs such as rent for cooking and storage space and equipment while reaching out to greater customers.

HOW LEADING COMMERCIAL R E A L E S TAT E O W N E R S A N D O P E R A T O R S A R E N AV I G A T I N G THE CRISIS

Some real estate firms are now starting the process of thinking ahead to deal with the uncertainties and the new challenges. However, rather than relying on old-fashioned approaches and strategies, real estate leaders are looking to psychologists, IT professionals,

While the longer-term consequences of the pandemic

and assets digitalization experts for answers.

are difficult to predict, the immediate market impacts

33

of the coronavirus crisis have been made clear. The

Will future clients demand larger and more enclosed

economic fallout because of the pandemic has put the

workspaces? What will people think about virtual open

commercial real estate market in the island of Crete on

houses and showings? While uncertainty currently

pause. Moreover, new listings of commercial real estate

reigns, commercial real estate owners may find new in-

assets with high ROI potential have dropped precipi-

sights and methodologies to effectively maintain their

tously.

assets and preserve their economic viability.

ARENCORES CHANIA REAL ESTATE MAGAZINE


CHANIA EXCLUSIVE PROPERTIES FOR SALE

ww w. c h a n i a realestate.co m

ARENCORES CHANIA REAL ESTATE MAGAZINE

34


The expected dramatic decline in tourist arrivals this summer in Chania, Crete due to the pandemic will definitely affect the real estate market. Signs of structural changes within the property market are already visible. Initial evidence from online property rental ads in the most popular short-term rental platforms (Airbnb, HomeAway, etc.) shows a significant fall in demand, in the context of tourist traffic restrictions. Consequently, this fact has led to an increased supply of apartments in Chania Town and Akrotiri area (Kounoupidiana, Pithari, Korakies) for longterm rental. The COVID-19 pandemic brings travel to a standstill, causing massive job and revenue losses. Thus, more and more landlords are moving away from short-term rental to the traditional long-term rental market. Apparently, in view of the impact of the pandemic on tourism, more and more property owners realise that their revenues are likely to be significantly reduced in the next months, making their properties not economically viable assets in the short-term rental market. It is noted that short-term rentals are a relatively new practice in Greece and have grown rapidly in recent quarters, while many land-

REAL ESTATE RECESSION? NOT SO FAST AND NOT FOR ALL PROPERTY TYPES

lords have taken out loans to renovate their properties for short-term leasing. Falling

W i t h the shorteni ng of the t o u ri st sea son i n Crete, p ro p erty- owners a nd propert y ma n a g ers have a l rea dy beg u n m ovi ng thei r properti es f ro m the short- term renta l ma rke t – ( suc h a s AI R B N B ) t o l o n g er- term model s.

rental incomes are putting strains on these investors’ financial position and debt-servicing capacity. Longer-term rental agreements are thus seen as a reliable and economically viable alternative. Most of these properties are one or two-bedroom apartments and they are also rented

H o w ever, shoul d we expec t a s i g n ifi c a nt c orrec ti on i n t erms of l ong - term renta l p ri c es or a reduc ti on i n the res i d enti a l properti es sel l i ng p ri c es?

furnished and fully equipped and, in most cases, have been renovated recently. Thus, their rental prices are typically higher than those of the large real estate stock in the same area. In addition, they are mostly located in specific areas around the centre of Chania city or near the Technical University of Crete in Kounoupidiana area and other tourist spots across the Prefecture of Chania.

It is a long established fact that a reader will

35

ARENCORES CHANIA REAL ESTATE MAGAZINE

be distracted by the readable content of a

The re-shift of apartments from the short-

page when looking at its layout. The point of

term market to the long-term segment, de-

using Lorem Ipsum is that it has a more-or-

spite the pressure it will put on rental prices,

less normal distribution of letters, as opposed

is not expected to lead to significant price

to using ‘Content here, content here’, making

adjustments in the selling prices of residential

it look like readable English.

properties.


G R E E C E ’ S C O R O N AV I R U S M A N A G E M E N T SUCCESS IMPRESSES FOREIGN R E A L E S TAT E I N V E S TO R S The appearance of Greece among the best performers in the world holding down the number of cases and severity of the virus has made foreign real estate investors eager to pick up properties.

Property requests from Germany were among the highest, followed by the United Kingdom, Norway, the United States, Israel, Denmark and Australia, countries to which scores of thousands of Greece’s youngest talents escaped during a nearly decade-long and severe economic crisis, indicating interest in returning home.

The scientific approach to dealing

alytics platform designed and main-

with the COVID-19 Coronavirus

tained by ARENCORES, showed

pandemic, making Greece among

that in April, as the first wave of the

the best countries in the world

pandemic progressed, there was

holding down the number of cases

a significantly large interest (no

and severities has made foreign real

transactions) by foreign buyers.

estate investors keen to get into property investment.

Property requests from Germany were among the highest, followed

There are growing signs that 2020

by the United Kingdom, Norway,

will be up from the previous year

the United States, Israel, Denmark

despite the aftermath of the virus

and Australia, countries to which

and a long lockdown that closed

scores of thousands of Greece’s

businesses temporarily and saw

youngest talents escaped during a

a dramatic decline in short-term

nearly decade-long and severe eco-

rentals such as Airbnb.

nomic crisis, indicating interest in returning home.

That’s good news for an economy that was set to grow 2-3 percent

Not on the list are China and Rus-

this year but now is predicted to

sia, possibly because the govern-

contract as much as 12 percent or

ment temporarily suspended visas

more, with tourism – the country’s

for Chinese visitors and property

biggest revenue engine – set to take

investors who had been the most

a big hit.

important buyers of properties they turned into short-term rent-

ME S TAY H O T I WA N T TO

O GO

CRETE

MME THIS SU

Foreign cash inflow numbers for

als, using the property purchases to

property purchases in 2019 were

qualify for the Greek Golden Visa

up an amazing 29.4 percent, reach-

scheme that comes with residency

ing approximately 1.50 billion euros

permits and visa-free travel to the

beating the previous record of 1.1

26 member countries of the Schen-

billion euros the year before.

gen zone.

Data from RESTful, a Big Data An-

R

RESTful by ARENCORES B I G D A T A A N A LY T I C S P L A T F O R M F O R T H E PROPERTY MARKET OF CRETE, GREECE

ARENCORES CHANIA REAL ESTATE MAGAZINE

36


REAL ESTATE CH NIA V

A REAL ESTATE BLOG DEDICATED TO CHANIA PROPERTY MARKET

www.chaniarealestate.com

37

ARENCORES CHANIA REAL ESTATE MAGAZINE


LINKING PROPERTY BUYERS AND OWNERS WITH EXCEPTIONAL R E A L E S TAT E SERVICES

WHY ARENCORES NOT AN ORDINARY REAL ESTATE FIRM To b u i l d a n d m a i n t a i n s u s t a i n a b l e r e a l e s t a t e p r o j e c t s A R E N C O R E S uses a holistic approach, necessary to enrich their business pot e n t i a l a n d e s t a b l i s h a n e f f e c t i ve d e a l s t r u c t u r i n g s t r a t e g y.

At ARENCORES we have developed and maintained an evidence based approach to design and structuring a real estate consulting experience for addressing critical challenges, in both event-driven and long-term scenarios of the real estate transactions and investment procedures. Because real estate is a sophisticated sector our engagements often involve the role of trusted business advisor via our practical, immediate and sustainable solutions. ARENCORES MEDIATION®, ARENCORES MARKET INTELLIGENCE® including ARENCORES PROPERTY MANAGEMENT® and ARENCORES Sourcing®, are a paradigm of the advantageous benefit brought to our clients by our professional team. We help our clients to identify and execute innovative ways in transforming complexities and uncertainties into true competitive advantages- an evidence to our aptitude to consistently deliver reliable results.

ARENCORES CHANIA REAL ESTATE MAGAZINE

38


ARENCORES CHANIA REAL ESTATE EXPERTS

26 Stratigou Tzanakaki Street 73134, Chania, Crete, Greece T: + 3 0 2 8 2 1 1 1 2 7 7 7 W:www.arencores.com E: info@arencores.com

Al l rig hts re se r ve d. R e p ro d u c t i o n i n w h o l e o r i n p a rt i s stri c tl y prohi bi ted wi thout wri tten permi ssi on.


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