Greece

Greek Islands for Sale


Greek Islands for Sale

Photograph by Robert Harding

(Corrects dollar amount of Skorpios purchase)

The residents of the Greek island of Lefkada are feeling a sense of deja vu these days. A short distance across the Ionian Sea, a billionaire and his family have been relaxing on the tiny island of Skorpios. This week it was Russian tycoon Dmitry Rybolovlev and his loved ones enjoying the lush environment and pristine waters; 50 years ago it was Greek shipping magnate Aristotle Onassis and his relatives taking in the idyllic surroundings.

Rybolovlev is No. 119 on the Forbes list of billionaires, with a net worth of $9.1 billion. His 24-year-old daughter Ekaterina purchased Skorpios and the smaller outcrop of Sparti in April for an undisclosed price reported to be around €100 million ($129 million). The island had been owned by Onassis’s granddaughter Athina, Aristotle’s only surviving heir. Onassis bought Skorpios in 1963 and spent five years developing the abandoned islet, a project that included the planting of hundreds of trees and construction of relatively plain living quarters.

Onassis and his mistress, opera singer Maria Callas, enjoyed the peacefulness of Skorpios’s sandy beaches, but in 1968 the shipowner married former U.S. First Lady Jacqueline Kennedy at the island’s chapel amid a blaze of publicity. In the following years, the island became a magnet for the world’s royalty and jet set, but Onassis’s death in 1975 marked the beginning of the end of the family’s association with the island. Despite being christened on the island, Athina Onassis rarely visited Skorpios, which is also where her grandfather and troubled mother, Christina, are buried.

Skorpios is one of several properties that the 28-year-old Athina, based in Brazil, has sold recently. In contrast, 46-year-old Rybolovlev has bought a number of expensive homes over the past few years, including Donald Trump’s Palm Beach mansion. His daughter’s purchase of Skorpios has grabbed people’s attention in Greece, and this week was the first time the billionaire, who made most of his fortune as the owner of Russia’s largest potassium fertilizer producer, and Ekaterina visited the island.

Local TV channels aired footage of Rybolovlev’s private jet landing at a small airport in northwestern Greece and of the tycoon’s friends and associates buying fresh fish on Lefkada. Apart from curiosity, interest in the billionaire’s movements in Greece is driven by expectations that his arrival will boost local businesses and concern about what plans he has for Skorpios.

The Greek media have speculated about what changes Rybolovlev will make to the island. Pictures of bulldozers being shipped to Skorpios did nothing to allay fears that it will not remain a haven for long.

On his arrival, the businessman invited Lefkada Mayor Kostas Aravanis and other local officials to Skorpios for an introductory meeting. Only one photograph of the event was made public. It showed Ekaterina shaking the mayor’s hand, an image suggesting to the outside world that the newly arrived neighbors will coexist happily with the locals “We are not worried about the family’s plans,” says Aravanis. “It is in their own interest to look after the island, which is a beautiful place.” The mayor believes Skorpios passing to new owners after a long period of being virtually derelict could help the local economy. “The reopening of the island could help the local economy, because some people will be employed there, and it will promote the area internationally,” he says.

In Athens, though, a little more skepticism was in the air. Finance Minister Yannis Stournaras informed Parliament that the government was seeking advice from the Legal Council of the State on whether the sale of Skorpios was in the public’s best interest. Stournaras was responding to a question from Yiannis Michelakis, an MP for New Democracy, the main grouping in Greece’s three-party coalition. Michelakis claims Aristotle Onassis stated in his will that if his family did not want to keep the island, its ownership should pass to Olympic Airlines, the carrier he founded in 1957, so it could create a children’s summer camp there.

The legal specifics of the case aside, the MP’s question is symptomatic of a wider concern in crisis-mired Greece about the fate of the country’s assets. The government has to raise €2.6 billion from privatizations this year and €11 billion by the end of 2015. While the sale of Skorpios is a private transaction, several pieces of prime publicly owned real estate are due to be sold in the near future. These include Afantou on the island of Rhodes, a vast plot of land that contains an 18-hole golf course and 7 kilometers of coastline. In February, Greece accepted a €23 million bid from a New York investment fund for a 99-year concession at the seafront property of Kassiopi on the island of Corfu.

Greece’s privatization agency, HRADF, has also identified 40 of some 6,000 islands owned by the government that it plans to offer to investors. The islands are uninhabited and range in size from 500,000 square meters to 3 million. Greece is adamant that it will not sell the islands but will offer leases of up to 50 years. Greeks’ concerns, though, will remain. They will perhaps mirror those of some Lefkada residents, who might wonder whether the arrival of wealthy foreigners will create prosperity and help them out of the crisis or whether natural beauty could be sacrificed for little return.

Malkoutzis is a Bloomberg Businessweek contributor.

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