A multitude of questions arise regarding the delay in the commencement of the major projects included in the announced as the largest investment in Cyprus, amounting to €1.2 billion, in the Larnaca port and marina.
At the moment, no one knows if the major projects will start in June, with the investment essentially hanging in the balance, as the company, according to the Government, has breached a significant term of the agreement.
Based on the agreed timelines, held by Phileleftheros, not only should the major projects have started, but the first ones should have already been delivered. The exact work schedule is published on the General Accounting Office’s Electronic Contracting System (e-Procurement) since May 2022, when a competition was announced to select an Independent Project Engineer.
Phase A of the project begins, as stated in the work schedule, from the signing of the agreement between the state and the company on April 1, 2022, and must be completed by March 31, 2027.
The first phase is essentially divided into four parts, concerning works in the marina and the port, as well as the development of infrastructure and commercial properties.
According to the timeline, works should have started across the entire spectrum of development from September 1, 2023, and the renovation of the preserved quay and the dredging of the marina should already be completed.
Despite the fact that the preserved quay has been opened, according to our newspaper’s information from competent sources, the work has not been delivered, as there is no completion certification.
It should be noted that there are many complaints and particularly scathing comments from the residents of Larnaca about the result at the preserved quay, as the difference is not visible, even though it remained closed for almost one and a half years.
Among other things, the work schedule of the first phase included the following:
Larnaca Port:
1/9/23-18/12/25: Construction of Port Buildings (port offices, police offices, port entrance, etc.)
1/9/23-2/1/25: Maritime works
19/1/24-18/12/25: New cruise passenger terminal building
7/8/25-17/2/27: Port works and upgrade of Public Utility Infrastructure
6/8/26-23/12/26: General dredging in the port basin
Larnaca Marina:
1/9/23-18/1/24: Dredging in the marina basin (Stage 1)
2/5/22-23/6/23: Full renovation of preserved quay
1/12/23-15/10/26: New breakwaters
1/9/23-18/12/25: Yacht club
18/3/25-15/2/27: Other required buildings
20/11/25-17/2/27: Marina services and public utility services
Real Estate Development:
1/9/23-25/2/27: Lifestyle Hotel (Buildings 221 & 223)
22/5/26-25/2/27: Landscaping, access roads, etc.
Infrastructure Development:
1/9/23-9/10/25: Construction of road connecting Phinikoudes with port (Stage 1)
1/9/23-9/10/25: Road Services and Public Utility Services
16/10/25-4/3/26: Demolition of existing Administration building and passenger terminal
5/3/26-17/2/27: Road construction (Stage 2)
7/8/25-17/2/27: Coastal road
It should be noted that three more phases of the investment follow: Phase B (1/4/27-16/10/2030), Phase C (1/4/30-11/7/34), and Phase D (18/10/33-31/3/38).
The extension granted by the state and the deadlock
Following a request from the company, the state approved an extension, setting the start of construction works for the major projects in the marina and port for June 2024.
However, it must be completed as stipulated in the agreement by March 31, 2027. Nonetheless, Kition, whose main shareholder is the European real estate giant Aroundtown, did not renew a guarantee of €10 million for the port, which expired on January 31, 2024.
Instead, it submitted a series of requests to the state for changes in the order of the Phase A projects to ease developments in real estate.
When the company was informed that the non-renewal of the guarantee constitutes, according to the Legal Service, a breach of a substantial term of the contract, it resorted to the courts, securing an interim order prohibiting the state from collecting money from two other existing guarantees.
The court has requested to hear the positions of both parties before making a decision. It should be noted that the hearing is scheduled for April 15 before the Nicosia District Court.
As highlighted in previous reports by Phileleftheros, the positions of the two parties are now extreme, especially after the public exchange of fire between the company’s CEO and the Minister of Transport.
Meanwhile, the company has initiated licensing procedures for the first phase of the investment projects but has not officially announced when they will start. Given the current situation, if construction does not commence in June, this would constitute a second breach of the contract terms.
Officials of Kition at the Presidential Palace on Monday
The upcoming week, however, will be particularly critical for the future of the investment, given that on Monday at 11:00 am, the President of the Republic will meet with officials of Kition Ocean Holdings at the Presidential Palace in an attempt to find a solution. The meeting will be attended by the Director-General of the Ministry of Transport, as the Minister is abroad, as well as the Mayor of Larnaca.
It is worth noting that the President of the Republic hastened to send a public message to the company stating that the state “is not being blackmailed.”
Next Friday, moreover, the Larnaca Development Committee will convene, attended by the Minister of Transport, while the issue will also be briefly examined in a joint session by the Parliamentary Committees on Transport and Oversight.
