The property registry project for 36,000 public real estate assets
Interview by Gregory D.Dimitriadis to Oikonomikos Taxydromos.
The CEO of Growthfund, Gregory D. Dimitriadis, characterizes the condition of public real estate assets belonging to the portfolio of HPPC (ETAD) as disheartening. In an interview, he reveals that 47% of the first 500 properties ETAD attempted to record cannot be located or have been encroached upon.
He emphasizes Growthfund’s determination to proceed with the registration of all 36,000 public real estate assets and subsequently their utilization. He also discusses the necessary reforms in State-Owned Enterprises (SOEs).
The central goal of Growthfund’s management is its transformation into a Sovereign Wealth Fund (SWF), following the example of similar funds in other countries. What phase is the implementation of this plan currently in?
“The transformation of Growthfund into a Sovereign Wealth Fund (SWF) is a complex project that requires careful steps, coordination, and ongoing collaboration with all involved parties, from our primary shareholder, the Ministry of National Economy and Finance, to the European Stability Mechanism (ESM), the European Commission, and, of course, our Board of Directors. This means it takes time. However, the processes are progressing as planned, and I hope, relying on the extensive experience and expertise of BlackRock, which is overseeing the transformation, that these will be completed within the next few months. I should note that over the past two years, we have already taken several measures and policies, from adopting ESG (Environmental, Social, and Governance) policies and manuals for our subsidiaries to establishing a reporting mechanism with our subsidiaries and adopting international best practices in governance matters, all of which significantly facilitate the transformation project.
Allow me to add a few more words about the importance, or rather the necessity, of Growthfund’s transformation into an SWF. In the new phase of the Greek economy with the regaining of its investment-grade status, we need new investment tools. One of these, as international experience shows, is Public Investment Funds. By functioning as responsible and long-term investors with environmental and social responsibility, they play a crucial role in attracting investments and ensuring the efficient utilization of public assets, safeguarding the rights of future generations to public wealth.”
The law on corporate governance of Growthfund subsidiaries was passed. Can you tell us what has changed with its implementation?
“The new law has significantly modernized the institutional framework for the operation of public companies, which had remained pending for several years. It has brought about a major shift in corporate governance, making it easier for public companies to meet the requirements of the modern market and become more efficient and competitive. Furthermore, it has allowed Growthfund to more effectively exercise its role as an active shareholder, with provisions for approving business plans of its subsidiaries, facilitating the establishment of a corporate policy, from environmental dimensions to governance principles, and streamlining expenses, among other things, with binding targets, transparency, and accountability.”
You have a broad portfolio of SOEs. From your experience, what specific reforms are required for their optimal functioning and delivering greater value to the public?
“Mr. Kolonas, the need for reforms is ongoing because the goal for continuous improvement, for even better results, is constant. By general consensus, the SOEs in the Growthfund group are operating like any modern, healthy enterprise, providing quality services to citizens at reasonable prices. Growthfund has contributed to this success, but it is not solely our accomplishment. It has been a decade-long effort with the participation of many, starting with the companies’ management teams. Nonetheless, we stand steadfastly by all our companies, working closely with their managements and the political authorities supporting their developmental path. I remind you that the selection of their managements is done through a meritocratic technocratic process. Each subsidiary is obliged to publish annual reports and, now for the first time, sustainability reports. Moreover, their procurement policy is cost-effective and is generating significant cost savings. Their developmental programs are aligned with the country’s goals for a green transition.”
ETAD completed the pilot project for the registration and utilization of 500 properties. What is the value of these properties, and which of them can be utilized and how?
“I regret to say that the picture from the pilot competition of 500 properties conducted by ETAD is disheartening. The decades-long neglect of public real estate left a high cost. The numbers speak for themselves. In 47% of cases, the exact location of the property could not be determined, and a significant number of properties have been encroached upon, now subject to separate legal frameworks. Another category of issues, though unrelated to long-standing indifference, is that many properties are subject to exceptions and restrictions (e.g., Natura).
It is evident that the part of public property owned by ETAD presents difficulties. However, this does not mean in any way that we will give up on the goal of registering and utilizing these properties. We will use every means and resource to ensure that the government knows the extent of its property, at least the portion that belongs to ETAD. We plan to launch a competition to have a record of all 36,000 ETAD properties, those that have not been encroached upon, and, of course, to make all citizens aware of the details of public property, which, as public, belongs to everyone.”
Source: Oikonomikos Taxydromos – ot.gr
