H.I.G. Capital: fresh 600 million euro investments in logistics and hotels in Greece

To date, H.I.G. Capital has invested €1.5 billion, while the next secured investments amount to €600 million. This figure is dynamic as further opportunities in the Greek market are being explored.

H.I.G. is currently ranked among Greece’s top three most active foreign investors. It employs approximately 5,000 workers, creating a significant impact on the Greek economy. According to estimates from its executives, the returns are reported to be in the range of 15-17%.

At a press event in Rhodes, the leading executives of H.I.G. in Greece discussed the ongoing plans. In Greece, H.I.G. operates through Inventio and has two investment sectors: the hotel sector through Ella Resorts and logistics through Streem Global.

The head, Konstantinos Bitros, mentioned that in the logistics sector, the consolidation of the companies acquired is currently underway so that they operate as a unified organization. This is expected to be completed within approximately 18 months by the end of 2025.

The acquired companies are Makios SA, Veinoglou SA, Unit Hellas-Unit Shipping SA, Contrade SA, Light Greece SA, Instant Trans IKE, and Nami. To date, all these companies have merged except for Makios and Veinoglou, which will be the next to complete the process.

Logistics

As noted by Dimitris Kalligeris, COO of Streem Global, they currently operate in five countries and will expand to nine: Greece, Serbia, Bulgaria, Moldova, Romania, Hungary, Cyprus, North Macedonia, and Kosovo. In total, they employ 2,500 people and have a turnover of €300 million. Their warehouses cover 500,000 square meters, and they currently hold an 18% share of the logistics market in Greece.

As mentioned, Greece’s role in logistics is particularly significant as it shortens transit times by 10 days and serves as a gateway to Europe. “We are conducting large-scale freight operations centred in Greece,” said Mr Kalligeris. Streem Global’s next goal is to expand northward into Central Europe, while in Greece, they are looking for more properties without warehouses. This allows them to customize the spaces according to their established standards.

Mr. Bitros ruled out any participation in developing the major logistics parks Thriasio I and Thriasio II. He argued that decision-making takes a lot of time in multi-stakeholder schemes. He prefers autonomy in decision-making and actions.

In contrast, the major investment in the former Halyvourgia Hellas site is underway, with construction set to begin in 2025. As warehouses are completed, they will be gradually put into use, with operations expected to start in 2026. This involves transforming the site into a model center for international transportation and storage (using trains, ships, and trucks – trimodal) with a total investment cost exceeding €300 million. The site covers 291 acres and includes the creation of 180,000 square meters of warehouses and 20,000 square meters of auxiliary spaces, with potential for manufacturing activities.

The project passed through the Interministerial Committee and was included in the country’s strategic investments in March 2023. The site remediation and demolition of the old steelworks have been completed for now. The licensing process is currently underway. The project is progressing under the supervision of Inventio Edge and maturing steadily.

When asked if the company is interested in railway transportation, it argued that Greece doesn’t have the capacity to meet its needs, as there is currently a bottleneck in the section up to Thebes, among other issues.

As mentioned, railway usage is of particular interest to Streem Global, as it is an environmentally friendly mode of transportation. Once the Serbian network is ready, it estimates that it will take at least 3 years to restore the network. Previous efforts to launch commercial freight trains in the past years were not successful.

Additionally, it revealed that the company has ordered two hydrogen trucks, the first in Greece, which will be supplied by Volvo. Regarding the procurement of electric trucks, it was mentioned that they are not particularly suitable as they have a limited range and require frequent charging.

Real estate & new hotel development

However, HIG also has a significant investment plan underway in the real estate sector, particularly in hotels. George Stamatiou, COO of Ella Resorts in Rhodes, recently completed the first 100% Ella Resorts, established in 2021, as they are also the operator of the hotel.

The hotel complex underwent a complete renovation, with significant emphasis placed on its architecture, incorporating elements from Rhodes’ cultural heritage. The renovation cost amounted to €45 million and was completed in a record time of 8 months.

The buildings have incorporated energy-efficient technologies such as the installation of photovoltaic panels, and 200 geothermal wells have been dug to cover part of the daily energy needs. Today, all 750 rooms of the triple complex are operational.

At Ella Resorts, 8 hotel units have been integrated across Rhodes, Corfu, Crete, and Athens, with a capacity of approximately 3,000 rooms. The company’s plans include expansion beyond Greece into the wider Mediterranean region, with a particular focus on Italy and Spain. The overall goal is to reach 10,000 rooms, of which around 6,000 will be in Greece.

In our country, their goal is to acquire hotels with specific characteristics: to be located by the sea, to have over 200 rooms, and to be within a maximum distance of 90 minutes from an airport. When asked about potential investment in Elliniko, Mr Bitros mentioned that it had been considered earlier but was ruled out as it was deemed expensive and did not fit their investment criteria.

Inventio Edge manages the supervision of hotels categorized as A+ energy efficient. When asked about contractor selection, Mr. Bitros mentioned a preference for local contractors, as the ultimate goal is to mitigate the transfer of costs to room prices.

The hotels they have acquired are:

• Tourist Enterprises of the South S.A., Rhodes (2018), formerly Aldemar Rhodes, with a capacity of 835 rooms, investment of €100 million.
• Corfu Holdings S.A., Corfu (formerly Mayor Holdings), has a capacity of 1,400 rooms (2,500 beds) and an investment of €150 million. Renovation works have already begun at the Alkyna Lifestyle Beach Resort (formerly La Grota Verde), which will be fully renovated and operational next season. Additionally, renovations are being prepared for Capo Di Corfu and Pelekas Monastery, with a total capacity of over 650 rooms, scheduled to start in the Fall of 2024.
• Acquisition of the former Aldiana Club hotel in Mohlos, Crete, with an investment plan of €50 million for renovation, expansion, and upgrade to a 5-star hotel named Rocrita Lifestyle Beach Resort, with a total capacity of 360 rooms. It will be operational for the tourist season of 2025.
• Acquisition of the former Althea hotel in Agia Marina, Attica, with a capacity of approximately 350 rooms. Currently, the renovation project is in its early planning and financing stage.

For more details and the complete article in Greek, click here