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Agreement for Athens old airport development signed, clearing way for next bailout installment

Xinhua, June 8, 2016 Adjust font size:

Greece's privatization fund announced on Tuesday the signing of an agreement with Greek construction company Lamda Development for the development of the Athens old airport Hellenikon site, paving the way for the disbursement of the next bailout tranche to the debt-laden country.

The finalization of the investment was one of the last prior actions the Greek government had to complete before international creditors give the green light for the release of the next loan installment.

The Hellenic Republic Asset Development Fund (HRADF) and Lamda Development have signed a revised Memorandum of Understanding (MoU) for the investment which will amount to 8 billion euros (9.09 billion U.S. dollars), according to an e-mailed press release from the privatization fund.

Lamda-led consortium had won an international tender for the development of the site two years ago. However, amid concerns over the initial plans presented, lengthy negotiations for changing the terms of the contract for the sale of the 100 percent stake in the Hellenikon followed.

HRADF head Stergios Pitsiorlas welcomed the signing of the deal on Tuesday as a positive step which will "mark Greece's course to development, as it opens the way for the creation of the largest metropolitan park and real estate development project in Europe" in coming years.

The investment will also help create thousands of job positions at a time when Greece suffers from high unemployment rates, the Greek official added.

According to the privatization fund the initial offer of Lamda for the 99-year lease of the 6.2 million square-meter seaside property was improved and the constructors will undertake a larger share of the burden for infrastructure works and the development of the park.

Under the project the now derelict buildings of the old airport which in recent months temporarily house refugees and the wider area will turn into a luxury coastal resort.

"Hellenikon" was put out of operation more than a decade ago ahead of the Athens 2004 Olympic Games.

According to a survey by Greece's Foundation for Economic and Industrial Research (IOBE) the development of the site can create 70,000 job positions over the next two decades and boost Greek GDP by some 1.5 percent. Enditem