Τhe concession agreement for the license to operate a casino at Ellinikon was signed yesterday. This signing marks the beginning of a type of investment that was missing from Greece: greenfield investments. The investment will start from scratch, will create a premium tourist spot, will offer employment to thousands of young people, will yield significant revenues to the public sector and, most importantly, will give added value to Greece’s brand.
The IRC Athens consortium, with main shareholder GEK TERNA, secured the license for the next 30 years at a price of 150 million euros, while it will spend at least another 950 million euros for the construction of a casino, a hotel, a conference center and sports facilities. GEK TERNA will proceed immediately with the submission of a request to the Gaming Supervision and Control Committee for the expansion of the consortium.
Hard Rock, one of the world's leading Integrated Resort Casino operators, will take part in the investment. The US company will acquire 51% of the joint venture and GEK TERNA 49%. The construction sector of the Greek company will undertake the building of 100% of the new facilities.
The structure of the investment
The consortium awarded the tender for the casino licence has committed to investments that far exceed the minimum requirements. Specifically, the four criteria of the technical evaluation were the following:
- a five-star hotel, covering at least 60,000 sq.m., with 200 beds,
- a conference center of at least 12,000 square meters,
- a sports centre hosting at least 3,000 spectators and
- a casino that should be larger than 12,000 square meters and up to 15,000 square meters, with 120 tables and 1,200 gaming machines.
The consortium's bid provides for a five-star hotel in an area of 120.000 sq.m. with twice as many beds as the minimum set, a conference center of 24,000 sq. m. and a sports center for 10,000 spectators. For the casino, IRC Αthens has stated that it will exhaust the upper limit of 15,000 square meters and will install twice as many tables and gaming machines.
The budgetary benefit will exceed 200 million euros every year, a total of 6 billion euros for 30 years. In particular, 3 billion euros will come from the casino's gross revenue tax (20% direct tax and 1% annual license fee), 800 million euros from income tax, 500 million euros from VAT, 1.1 billion euros from social security contributions and 600 million euros from fees to municipalities.
The revenues of Lamda Development as the concessionaire of the land will not be negligible. The contract between the two sides provides for the consortium to pay 15 million euros as a minimum annual fee or 5% of the annual turnover, whichever is higher.
The next steps to advance the investment are the ratification of the contract by Parliament and the issuance of building permits by early 2023. The construction work will take at least three years.
Hard Rock has a presence in 74 countries and a portfolio that includes, among others, 11 casinos, 29 hotels and 188 cafes.
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