| Politics |Haber Kıbrıs

THE STATE LEASES ITS OWN PROPERTIES AT LOW PRICES, ENABLING OTHERS TO GET RICH OFF THE PROPERTIES RENTED

ΕΛΛΗΝΙΚΑ (GREEK) TÜRKÇE (TURKISH)

The understanding of politics in our country is largely based on “distributing advantages”.

Granting favours to supporters, coaxing those who aren’t on their side, and handing out advantages as a form of bribery to those they want to draw to their own ranks…

A system of nepotism and partisanship that prevents this country from flourishing, and instead paves the way for its transformation into a monstrous structure…

The craftiness of the right-wing parties, especially UBP [National Unity Party], is in the way they distribute benefits to party members.

This has become such a widespread practice that when other parties refuse to do the same while in power, they face reactions from their party base.

After 1974, they distributed Greek Cypriot properties for years, created benefits for their supporters through Greek Cypriot properties, giving out more and more without end…

They handed out “T-permits” [Taxi permits], “Petrol station permits”, “state-owned land”, “plots”, and “fields” to their supporters, leased out what they couldn’t hand out, factories owned by Greek Cypriots, certain business centres, hotels and much more…

Some people in important positions benefited both themselves and their circles since they had the means at their disposal.

With the favours they granted over Greek Cypriot properties, they created a group of rich people…

There isn’t much left to distribute today but they are still trying to give away everything they can.

I mentioned “leasing” above, since there is not much left to hand out, valuable state-owned buildings or properties are still being leased to party supporters.

They’re leasing very valuable properties at very low prices, allowing some to earn high profits.

A few years back when I was working at Kıbrıs newspaper, we did a story on a property that had been leased as a favour, backing it up with papers we were able to find, reporting how extremely valuable properties were being leased at low prices to party supporters. It was a very good story, I searched for it before writing this article but couldn’t find it…

I guess we need to do such a story again, write to the relevant departments, and reacquire those documents….

Do you know why I touched upon this subject? I’ve recently been reading stories, interviews, and columns in the papers on the problems experienced by those in charge of running Palm Beach Hotel.

My dear Rasıh Reşat touched upon this issue in his programme the other day…

In summary, this is what the matter is about; a business leases Palm Beach Hotel from the state, turns around and rents it out to another business for much higher figures. He then raises the rent despite the fact the amount he is paying to the state is still the same…

There are other similar issues, which we had tried to address in the story we did at Kıbrıs newspaper. We asked the question, “Why does the state not lease its property directly, but creates the opportunity for some to rent out those properties at low prices, and make big profits by renting it to others?”…

Individuals in charge of leasing these properties offer benefits to others through state-owned properties, but would they act the same way if these were their own properties?

Would a minister or the director of a public department, or a member of a commission, rent out his/her property for a cheap sum, and then sit and watch others earn millions off his/her property? I don’t think so! They definitely would not but, of course, it’s a different story if we’re talking about state-owned properties, in this case, they do.

The Palm Beach Hotel issue, which we have been reading about in the media, is exactly about this.

Palm Beach Hotel is a Greek Cypriot-owned property, one of 50 or so hotels located in the fenced-off city of Varosha, its real name is Constantia Hotel Famagusta…

I believe it was used briefly as a tourism training hotel in the second half of the ’70s, in ’76 or ’77.

It became Palm Beach Hotel after it was rented out to a Turkish-foreign partnership at the end of the ’70s.

This partnership was unsuccessful, it didn’t work out and the hotel was sold to businessman Asil Nadir in 1985.

It was said that Nadir had paid the state much more than what the hotel was worth.

However, Asil Nadir’s Polly Peck International (PPI) firm in the UK plunged into a financial crisis following the accusations and investigations launched by the British government, finally going bankrupt.

Consequently, Asil Nadir’s enterprises in Cyprus also experienced trouble and his properties were sold back to the state. Palm Beach Hotel was one of those properties.

Exactly six years later, in 1996, the saga I mentioned begins.

The State Property Department leased the hotel to a group of companies called “Bilfer” for 40 thousand dollars per year.

In 2007, this group found a way to generate more income from the hotel and rented the Palm Beach Hotel to the Arkın Group.

The owner of the firm who himself rented the hotel for $40,000 a year, set an annual fee of €400,000 to Arkın Group and collected this money from 2007 to 2019. However, in 2019 he raised the rent to €700,000 a year.

The Arkın Group objected to the €700,000 but the company insisted “to be paid this amount”.

Moreover, Arkın Group invested close to 25 million dollars in the Palm Beach Hotel…

Of course, a disagreement erupted between the two firms after the rent was raised to 700 thousand Euros, and the issue was taken to court, which then resulted in the closure of the hotel. The company which had rented the hotel from the state for $40,000 turned around and sued the state because of the drawback.

The case is still continuing but the process has been blocked, court cases in our country aren’t concluded that easily but I hope that this case will be finalised as soon as possible.

The point I want to make is; why does the state lease its own property for cheap and give the opportunity for someone to earn big money over that property?

Let’s say that someone made a mistake, why is that mistake not corrected? You as the state are going to rent your property for $40,000, that person is going to go and rent that property to someone else for €400,000, they will not be satisfied and will raise the figure to €700,000. What a great country…

The state received $920,000 in rent money from the day the hotel was leased to the day the court case started, and the person who rented out the property earned €5m.

While this poor state is barely making ends meet, why should it allow others to earn millions off its back? Why should the state not earn €5m?

Furthermore, the commission operating under the State Property Department leased the hotel until 2045. There is neither a government decision nor a tender launched for such a strategic facility.

The commission operating under that department decided to rent out the hotel for 49 years to this firm, for an annual fee of $40,000, between 1996 and 2045. And that firm leased the hotel to another firm for an annual fee of €400,000…

This is how state properties are made available as benefits for others… Even if the figures may not be as high, there are other state properties rented out in this country in a similar fashion, and at such ridiculous prices to extremely wealthy persons that you would be shocked…

Do you see how this state has been run all these years? Do you see how the state’s resources are being handed out as benefits? Do you see how some are benefitting, enriching themselves through state assets?

They say that this state has no money… This state would have money if those running it did so properly but if such inconceivable moves are made and if resources are handed to supporters in such fashion then of course the state will have no money.

As with this case and similar others, if those running the state knew the value of state property, the country would not be in this situation.

Source: THE STATE LEASES ITS OWN PROPERTIES AT LOW PRICES, ENABLING OTHERS TO GET RICH OFF THE PROPERTIES RENTED

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ALİ BATURAY | HABER KIBRIS
Ali Baturay was born in Klavia (Alanici) village of Larnaca on 14 October 1968. He studied journalism. He holds a master’s degree focusing on “New Media and Changing Newspapers and Journalism in the Northern Part of Cyprus”. He worked for Halkın Sesi Newspaper between 1986-1995, for Yenidüzen Newspaper between 1995-1998 and for Kıbrıs Newspaper for 22 years, between 1998-2020. He worked as news director, managing editor and editor-in-chief at Kıbrıs Newspaper. He started working at the digital newspaper Haber Kıbrıs in February 2020. Currently, he works as the general editorial coordinator of Haber Kıbrıs. He writes daily columns and is the producer of a programme titled “Markaj” at Haber Kıbrıs Web TV during week days.

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