Athens infrastructure: how will new projects boost connectivity and what are the benefits for property investors?
The Greek economy is recovering from the crisis. According to the national statistical service (ELSTAT), after eight years in recession, the country’s GDP grew for four straight quarters in 2017.
One of the main growth drivers of economic growth in Greece is tourism. According to estimates by market research company Euromonitor, Athens is the city with the second-fastest rate of tourist growth in Europe, behind only Heraklion, another Greek city. Almost 5 million tourists visited the Greek capital in 2017, or 10% more than in 2016. In 2017, Athens International Airport handled over 14 million international passengers, which is 12% more than in 2016.
To cope with the demand, the city is upgrading its transport infrastructure. In March 2017, the EU announced that it would invest €1.3 billion into this, which would allow the country to finish the projects it started back in 2007–2013 by 2020. One-third of the amount will be allocated to modernising the transport infrastructure of Athens and expanding the capital’s metro network.
The Athens metro, which is used by 1.4 million people daily, includes three lines totalling 85 kilometres. The first (Green) line was launched in 1869, making the city's metro the world’s third-oldest underground system after London and New York. The second and the third metro lines were launched in 2000, and they have made the lives of the capital's residents significantly easier. For instance, a trip from Syntagma Square to the northern suburb of Chalandri, located 12 kilometres from the city centre, takes 45 minutes by car but only 14 minutes by metro.
Extending the third line
The third (Blue) metro line runs from the north-eastern Doukissis Plakentias station (connected to the city airport via overground rail) to the south-western Aghia Marina station. The project, led by Attika Metro, will extend the line through the western suburbs of Athens to the port of Piraeus. The total value of the project exceeds €467 million (with the EU investing €261 million).
Construction started in 2012 but was postponed for three years due to technical problems and project management errors. According to the Minister of Infrastructure, Transport and Networks, Christos Spirtzis, by 2019, the neighbourhoods of Aghia Varvara, Korydallos and Nikea will be served by the metro. The project is expected to be completed by the end of 2020.
Within the framework of the project, there will be 7.5 kilometres of tunnels, six new stations and 16 new trains. The 50-kilometre-long metro line will include 27 stations, and the new section is expected to handle 132,000 passengers per day. The extension of the third line is expected to reduce the city’s carbon dioxide emissions by 120 tons a day.
When complete, Greece’s largest port of Piraeus, Athens International Airport and the historic city centre will be located on the same metro line. Travelling from one end to the other will be reduced from 2 hours to only 55 minutes and will not require changing trains.
Constructing the fourth line
The construction of the fourth (Yellow) line is one of the EU’s largest infrastructure projects to date, valued at €3.3 billion. The radial line will connect the city centre with the northern suburbs. The total length of the line, which has 30 stations, will be 33.5 kilometres.
The first section will run from Alsos Veikou to Goudi, is located closer to the city centre and crosses densely populated neighbourhoods. it is almost 30 kilometres long and has 14 stations. Applications for tenders for its construction closed in August 2017, and work is expected to commence in 2019 and be completed by 2026.
The new line will significantly reduce the travelling time for commuters from the northern suburbs (for example, a trip between Alsos Veiku and the city centre will take 10 minutes instead of 30 minutes) and will reduce carbon dioxide emissions by about 280 tons a day. The first section is expected to be used by 220,000 passengers a day.
Tramway to Piraeus
Another infrastructure project the EU is investing in is the extension of the tramway to Piraeus. The government's aim to improve connectivity with Piraeus is understood, as it is one of the largest passenger ports in Europe, an important node in the New Silk Road (particularly with Chinese shipping company COSCO's acquisition of a 51% stake in the port in 2016) and a neighbourhood with 164,000 residents.
The construction of the €61.5-million tramline, which will connect the centre of Athens to Piraeus, started in April 2014. The project includes 13 stations, and will serve 11,000 people daily when completed, which could happen as early as Q2 2018.
Property prices to grow in neighbourhoods near metro stations
Prices of real estate in Athens have already stopped falling. According to statistics from the Bank of Greece, the price per square metre remained stable between Q2 and Q4 2017. Analysts expect property prices to rise due as the country’s economy recovers and tourist numbers grow. The expansion of the public transport network is also expected to boost the growth of property prices in the neighbourhoods adjacent to new metro stations.
According to Alina Churikova, Tranio's project manager for Greece, property prices cannot be expected to rise sharply in the centre of Athens (e.g., Kolonaki) as the price per square metre there is already higher than in the other city neighbourhoods. "The situation is different with more remote neighbourhoods such as Piraeus, Galatsi or Kypseli — price growth of 20–25% is possible there", she said.
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