Cyprus Property News
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Panayiotis Paschalis: The Man Who Introduced Cyprus Property Market To The Chinese

The opening of the large and promising Chinese market, selling over 150 homes in Chinese buyers over a year, can only be considered to be a remarkable achievement. Particularly when the sales of Paschali Developers are made in one of the most difficult periods for the cypriot economy, as a tonic shot for the industry of land development, as aptly said by the CEO, Mr Panagiotis Paschalis.

It is proved they are right when they say that luck helps the bold, and those who have the ability and experience to see one step further than everyone else. The most positive of all, however, remains one, according to Mr. Paschalis: The Chinese market is large enough to offer potential buyers for all, as long as there is seriousness and professionalism.

Tell us initially, Mr. Paschalis, a few words about Paschali Developers. When was the beginning, and what activities to date?
Paschali Developers began operations in the 1980s as a small family business with deployments by individuals for the construction of small flats and houses. Then we proceeded to the development of hotels, and we took on their operation, with a large percentage of shares in the Aqua Sol Hotels company, which was based in Ayia Napa.
Since early 2004 we took a step further with an independent part of the Company, which dealt only with the development of residential property and continues with the same operations untill today. It was not long before the base of the company moved from Ayia Napa to Paphos, keeping also offices in Larnaca and Famagusta. Until now, the company remains a family business.

The big step
How did you decide to take the big step and focus on the hitherto unknown Chinese market?
In late 2004 we focused on the English market, where we had a significant number of sales. Then we worked on the domestic market and the markets of Russia and Iran. In the process, after much thought and analysis and in trying to find ways that will improve the sales of property - which were significantly reduced due to the economic crisis that plagued and continues to plague the economies of all countries - we decided to do research, among others, in the Chinese market.
One year and half ago, we were the first to start investigations and visits to China. We made partners there, so we were able to successfully make our entry into the Chinese market, which until then had been completely unknown among Cypriots.
We worked hard and methodically, as this market was not easy, since there are quite large differences in perspectives and response, in comparison to other European markets. Nevertheless we were able to quickly accomplish the first agreements to sell properties to Chinese customers, which increased in numbers daily.

How many sales you've made since then? Is there truth in what is heard on more than 150 properties?
I am delighted for you submitting to me this query, since enough has been said about these numbers. Several commented on the matter without having any involvement in this, either trying to exploit those sales to their personal advantage or to their companies.
The information is actually true. These numbers are a fact. These sales were made by our company in the amounts and numbers that have been heard. In the last year we have completed more than 150 property sales to Chinese customers. A number of extremely high, given the negative conditions in the economy. The sales made more than €60 million by now. It is right and fair, to clarifythis matter, so that people have the right information.

What are the motives which urge a Chinese buyer to make an investment in the Cyprus property market?
It is now known that the main reason for a Chinese buyer purchasing a resident in Cyprus is to obtain a permanent residence permit in an EU country.
Around February 2009, in an attempt by the state to increase the number of investors from third countries adopted some positive regulations - additional to the existing legislation - which create favorable incentives for third countries to invest in Cyprus. These regulations specify that a citizen of a country outside the EU can obtain a permanent residence permit in Cyprus buying property worth more than €300.000. This was the main weapon we decided we can use to attract customers from the Chinese market, which has acted like a magnet and brought great success!
Conditions today are very beneficial as both the legislation and the values are helpful, especially the values that are extremely advantageous this period. At the same time the Chinese economy is doing very well, which contributes to the increase of clients we are watching every month.

Do the state procedures facilitate or hinder your efforts?
The truth is that until recently the process to obtain a permanent residence permit in Cyprus was very time consuming. Usually tookfrom eight to twelve months. However, thanks to new regulations and decisions of the Cabinet, this process will likely fall to two months, since the law entitles the respective Interior Minister himself, to deal with the requests.
Of course, in order for the application to be approved, the nominee applicant must meet the specifications and conditions. This decision significantly reduces examination of applications and therefore the hassle of foreign investors. Time was, until recently, the only negative factor in the beneficial immigration policy of our country, and this has been corrected after several interventions both by us and by organized groups.

What the Chinese call
What are the requirements of Chinese buyers, how easy it is to satisfy and meet their "wants"?
The majority seeks individual homes close to the value of €300.000, which provide the rules. The interest exists, but is not limited to these levels, as most are looking to combine obtaining permanent residence permit with a good investment that will lead to future profit.
Property prices range from €300.000 to €1.5 million and the greater interest is shown in Paphos then follows Larnaca and Famagusta.
The properties that interest them the most are those that are either near the sea or have a sea view, preferring areas and sites that feature various amenities, such as the city center.
It is a market with quite peculiar and particular mindset and way of thinking, which is far from European culture. Personally I made more than ten trips to China in my effort to study and understand their thinking and identify what they ask. That was the main reason for our great success.
I think that the large numbers of sales, our company has acomplished so far, are the answer in the question whether we can meet the "wants" of the Chinese customer.

Why they prefer Paphos?
Because the Paschali Developers headquarters are located in Paphos, we directed our customers there. At the same time as Paphos town has all the requirements to satisfy our clients, with rare beauty and environment playing a primary role. As it was done in Limassol with the Russians, the same happened now with the Chinese in Paphos. The first Russians went in Limassol and were followed by the "descent" of the most of them there. So we ended up at the same point that our clients are now seeking for properties in Paphos and we do not need to make a particular effort to convince them to invest here.
My vision was to put the foundations for something equally possible in Paphos with another big market and it is proved that the Chinese were the best choice.

We observe that many of your colleagues have come out with signs and advertisements in the Chinese language in an attempt to reach Chinese buyers.
We work quietly and do not need either signs or advertisements. Those who advertise today are those who follow us. As pioneers, we brought and continue to bring large numbers of Chinese customers in Cyprus.

We know who we are and successfully managed to become known in China with our own way. Our advertisement is our customers and our partners. And the signs are a way of advertising, but in the Chinese market this is not what counts. Those that are crucial are other much more important than labels, such as viability, projects, financial stability and active constructions.
Risk of non-professionals
Are you worried regarding the competition?
On the contrary. I am glad to see that other companies are progressing and doing their own steps to enter the Chinese market, which is great and there is room for everyone.
What saddens me is unfair competition. Unfortunately some people are trying to harm us, but the truth is that it is difficult to manage that. I believe that the best way for anyone who is interested to make an opening to the Chinese market, is to devote time and money, since there is data available, in oder to be able to demonstrate their abilities without trying unorthodox ways to profit taking advantage of what we have set as base. However, there is other issues that concern me...

What is it that worries you?
What worries me are the non-professionals who can do damage not only to us but to the whole market. Some are professionals and are seeking a quick profit without being interested in a follow-up to this very important opening we do. Such people, who are in a state of panic because of financial difficulties, make desperate moves, which in the end would prove disastrous for the market.
The major companies are organized, know the rules, follow the procedures and advise customers properly. The paratroopers, though, most times give false and misleading information, so potential buyers lose confidence and interest in the Cyprus market. When buyers hear ambiguous information, become worried that someone tries to trick them and this is when damage is done. The potential buyers will carry negative comments back to their country, so other potential investors will draw false conclusions.
We spent a lot of time and money
What do you forsee regarding real estate purchases by Chinese in the future? Are you optimistic?
I am very hopeful that this interest will continue and we will see a signifigantly dynamic descent of Chinese  in Cyprus, after the first successful steps of our company.
There is, however, need for professionalism. On our behalf we spent a lot of time and money, in order to open up this market . Personally I have traveled many times to China and studied the market thoroughly. Unfortunately, many in Cyprus are waiting to find customers in the streets or to attract them with advertisements on the streets, in restaurants and hotels.
China is a huge market, so those who have the appropriate knowledge, experience and skills in the subject they can manage to have a positive effect. We need, however, a lot of work, study and methodology.

Do you believe such investments from China can prove to be life-saving for the Cypriot economy?
The interest of foreigners for acquiring immovable property in Cyprus is very important for the wider economy of Cyprus. So far we have sold over 150 properties, thus contributing, on our behalf, to the state coffers with taxes, while creating new jobs.
The value of projects reaches €60 million and as you can see this is a major injection into the real estate industry from a market with huge potential. This was only the beginning and the beginning is always difficult. I think the sequel will be even better as long as professional and correct movements are done by other colleagues. Only serious companies will survive and I believe that we will see the stream from China to grow in Paphos.

Source: Interview from Mr Panayiotis Paschalis taken from, by Maria Pileidou.