Before we dive into the world of V2 Developments and your journey as its president, let’s begin by taking a closer look at the real estate sector in Greece. Is it safe to say that Greece is one of the hottest real estate markets in the European Union (EU)?
It is definitely safe to say that it is the hottest real estate market in the EU. After surviving an almost ten-year financial crisis, an increase in Greek property prices and real estate in general started in July 2015, when we reached agreement with the EU regarding Greece’s debt. From October 2008 until that point in 2015, we had lost around 30 percent of properties’ initial price on average—some areas suffered more than others. I think that this is the greatest economic transformation that a country has suffered in the western world, outside of a period of war. After that July, we saw a steady increase in income that reached around 12 to 15 percent. In the future, we expect this to pick up an even faster pace to cover all the ground that we lost since the beginning of the financial crisis and surpassing it. Athens, in particular, is posed to become a worldwide destination in terms of real estate. There are many projects taking place and others have been agreed and scheduled. We are very optimistic about the country’s new government and applaud their business-oriented agenda.
V2 Development is Greece’s number one real estate development company. It is the successor of Ergon S.A., a company founded by your father that defined real estate development in Greece from the 1960s onward. What are some of the Kteniadis family values that are still ingrained in the company’s ethos and contribute to its success?
Our company stands for ethos or, to use another word, integrity. I have mentioned on multiple occasions that, back in 1960s, people were doing business with a handshake. All you had in that distant business world was your word of honor and it was extremely important that you kept your word. Before everything was put in clauses and the small print of legally signed agreements, it was all based on your word. That was my father’s strongest point, this is what I learned from him and we convey this principle through our company even today.
Today, the company has been transformed. We are a multinational company with offices worldwide—we have a corporate sense, which is completely different from the family company of the 1960s. Still, however, we have the same principles that I hope are instilled deeply and we aim to preserve integrity in this business world. We keep in mind that most of our clients, almost 87 percent, are foreign investors that do not know about our company or what we represent in Greece. It is crucial that we keep getting this message across in Greece and worldwide through our vast network of partners around the globe.
Under your and your father’s leadership, V2 Development has successfully developed and sold over 7,500 real estate assets, which include residential, retail, hospitality and warehouse facilities totaling more than 4.5 million square meters. What are some of the company’s flagship projects or ones that you are most proud of?
All those assets have been exclusive ownerships. We are not talking about synergies, agencies or mediators—we are talking about real estate assets that were owned by our company and carry the signature of either myself or my father. The biggest real estate project for Ergon Development was the development of an area in Loutraki, 85 kilometers from Athens. We developed 4,200 plots there back in 1977 and sold them all in just two years. As far as magnitude and success are concerned, that was a project that defined Ergon Development.
With the rebranding to V2 Development, we are focusing more on construction, which Ergon was not doing as it focused mainly on development of land. In the past, Greek people did not have the ability to directly go and purchase a property, due to a lack of financial means. My father was a pioneer in developing land and selling plots with in-house financing and the first to introduce this in Greece. That gave the opportunity and the ability for underprivileged people to get a piece of land. It created a paradigm, I would say, in real estate reality for the entire world, as Greece now has one of the highest property ownership rates in Europe, with more than 78 percent of Greek people owning their property.
The reason that so many Greek citizens own property is because they purchased land, granting them the ability to slowly develop their own houses. Later on, they would give their plots away to construction companies. Those companies would be getting the plot without paying any money and, in return, they would give the original owners of the plot some apartments out of the project. That was a practice that was highly criticized during the 1960s and 1970s, but now everyone can see the value of it. I have to say that this is what kept Greece together during the financial crisis—at least the vast majority of Greek citizens managed to stay in their own houses, with all the safety and security that a property gives to people and which led to a much more bearable situation. If it was not for the fact that 78 percent of Greek citizens are property owners, I am sure that the social distress would have been tremendous, leading to a literal social meltdown. It is a unique situation worldwide but this course of action, pioneered by people like my father, has truly paid off and has to be recognized.
As a company that mainly focuses on residential property, are there any new areas of real estate development that the company is currently seeking opportunities in?
We are not involved in the commercial and warehouse markets, as we are strictly dedicated to residential development. The geographical areas that are the most popular and expensive are in the southern suburbs of Athens, like Palaio Faliro, Alimos, Hellinikon, Glyfada, Voula, Vouliagmeni and Varkiza. There are some more opportunities existing downtown, in the center of Athens, because the prices dropped there more on average than in any other area of the city during the financial crisis.