The past few years Limassol has experienced development in an astonishing rate. The post-crisis era brought a series of governmental reforms for financial recovery. Part of these reforms was the intensification of the naturalization plan, which created massive foreign demand in the citizenship by investment scheme. Limassol was the town that attracted most of the new foreign demand. Consequently, there was a boom in the construction industry which included the development of a number of projects, such as the high-rise towers along the coastal avenue of Limassol, which shifted the dynamics of the local real estate market. Prices skyrocketed as high as €15,000 per m2 and applications for developing high-rise tower started to build-up.
Towers
There are currently a number of high-rise towers along the coastal avenue of the Limassol Marina and as far as the coastal part of Moni. Some of the most notable projects include the One, The Oval, Oxley Towers, Zaria Residences Sunset, The Tower at the St. Raphael Resort, Park Tower at Parklane, Dream Tower, iHome Towers, A Tower, Olympic Resort, Skt Tower, Limassol Del Mar, The Icon, i100, Marr Tower, The Highgate, Total Tower, Aura, Landmark, Neo Towers, The Gallery, Arc Ship and the Trilogy. Some of these towers will reach as high as 45 floors and the cost of their development is expected to reach record levels for the local market. For instance, the expected cost for the Trilogy Tower’s construction will be over €350 million. Of course, it remains to be seen how the Cyprus passport program will unfold, as strict criteria were applied in May that resulted in a dramatic fall in “passport‟‟ sale transactions. Some of those projects might not eventually proceed with development if the market demand drops at lower than expected levels, or in the unlikely event the government is forced to discontinue the program.
Market Driving Forces
However, the Limassol Real Estate Market has been diversifying. There has been increased demand across all types of properties within Limassol, including Grade A office spaces, apartment units, industrial and retail spaces. Construction for all types of properties is on a continuous rise. However, it is a well-known fact it takes time for supply to meet demand in the real estate industry. This imbalance created an uncontrollable increase in rents. The increased level of demand for these types of properties arises from a variety of factors, including the close proximity of the Limassol Marina with the Historical centre and the Cyprus Technological University which brought an influx of students in the area competing for a limited number of residential units that are allocated to the rental market. Not to mention that a decent percentage of these available units tend to be allocated to the short-term rental market through electronic platforms, such AirBnb, which are absorbing available stock creating further imbalances and rental increases. In addition, demand comes from numerous international companies that have been established in Limassol over the past years, some of which need accommodations for hundreds of employees.
West Limassol
Lately, the focus has shifted to the west part of the town as well, which has been characterized as underdeveloped in relation to the east coastal part of the town which comprises multi-storey luxury tower developments and 5-star beach hotels. The west part of the town is gradually gaining in value and significance with the plan for infrastructure developments, including the proposed road which will connect the Limassol Marina and the Old Port with the new Port and consequently, the “My Mall” shopping centre and the proposed Casino development„ City of Dreams Mediterranean, which is expected to operate by the end of 2021. This is a development worth of €550,000 million and is expected to create around 4,000 new employment opportunities and attract 500,000 million additional tourists to the area.
