Government Cancels Larnaca Marina Development Contract

The Cypriot government has cancelled its contract with Kition Ocean Holdings for the Larnaca marina and port development project, accusing the company of breaching the terms of their agreement. The termination follows advice from the Law Office, which identified Kition’s refusal to renew the guarantee for Larnaca port as a critical contractual breach.

Officials delivered the termination notice to Kition Ocean Holdings yesterday morning. Kition reacted strongly, expressing their “surprise” at what they called the government’s “disregard for the court process.” The company stated that the government’s actions undermine the rule of law, which should protect investors. Kition emphasized that they have always acted according to the agreement and the law, and they are exploring their legal options in response to the termination notice.

The mayor of Larnaca, Andreas Vyras, described this development as a “negative turn of events,” highlighting the importance of the Larnaca marina and port project for the city’s and Cypriot economy. Despite this setback, Kyriacos Kiliaris, Chief Marketing Officer at Danos International Property Consultants & Valuers, remains optimistic about Larnaca’s future, citing ongoing multimillion-dollar projects and significant growth potential.

Larnaca has emerged as a key player in the Cypriot real estate market, experiencing unprecedented growth in the investment and residential sectors. The city continues to attract foreign investors and locals seeking their dream homes, resulting in rising rental and sale prices. Current rental prices for one-bedroom apartments range from €500 to €600, two-bedroom apartments from €650 to €750, and three-bedroom apartments from €800 to €950. These rates have doubled, and in some areas tripled, since 2019. Property sale prices have also seen significant increases of 50 to 70 percent in the district.

Surrounding areas like Pervolia and Livadia have also experienced a surge in land prices, with plots doubling in value since 2019. For instance, a plot in Livadia that cost €100,000 in 2019 now sells for €200,000. However, some villages like Alethriko still offer affordable options for those looking to build their homes.

Larnaca’s development is multifaceted, including the revitalization of the Dhekelia beachfront area, previously dominated by oil refineries. Private initiatives are actively promoting projects in this area, with the Petrolina Group’s ambitious Larnaca Land of Tomorrow project, exceeding €1 billion in costs, exemplifying the city’s growth potential.

Despite the challenges posed by the termination of the marina contract, Larnaca’s real estate market remains robust, with numerous opportunities for investment and development on the horizon.