SPANISH MODEL UNDER SCRUTINY FOR PROPERTY SALES TO FOREIGNERS (Tuesday, August 08, 2006, originally compiled by TDN)

More than 62,000 foreigners have bought 57,472 properties in Turkey to date, according to data Finance Minister Kemal Unakıtan submitted to the Constitutional Court on Monday while explaining amendments to the Property Law.

The “Spanish model” is being worked on for adaptation to Turkey vis-à-vis property sales to foreigners, reported the Anatolia news agency. 

Finance Minister Kemal Unakıtan together with Culture and Tourism Minister Atilla Koç were in Spain July 28-30 researching property sales to foreigners.

They visited Madrid and Malaga to examine the model Spain was using for property sales to foreigners and also looked into the marketing of second homes.

Spain has sold 1 million homes to foreigners at an average price of 178,000 euros, they found during their fact-finding trip. Spain has earned revenue of 178 billion euros from property sales to foreigners.

The private sector markets homes to foreigners in Spain, and a large percentage of home sales to foreigners are summer houses that are sold at their design stage. Marketing firms take scale models of their building sites to Germany, Britain, France and the Netherlands and display them to potential buyers.

After sales from projects, the revenue collected is used to construct the dwellings with the finished homes delivered to new owners in the shortest time possible. In the Spanish model the contractor normally manages the site or it is subcontracted out.

During the ministers' visit it was discovered that villas had been built around golf courses and sold them to its own citizens or foreigners for between $1million and $3 million.

Unakıtan has asked his staff to work on the Spanish model and adapt it to Turkey.

Meanwhile, Unakıtan appeared in a hearing at the Constitutional Court on Monday, explaining amendments to the Property Law.

Among some figures he submitted to the court was the number of properties foreigners have bought since 1934. It was 57,472, he said, breaking down the sales as follows: 43 in 1934, 143 in 1950, 118 in 1960, 180 in 1970 and 357 in 1980. In 1984, because of changes to the law, foreigners bought 1,002 properties and again broke the numbers down as follows: 1,593 in 1989, 2,885 in 2002 and 3,960 in 2003. In 2004, this number reached 8,981 and 6,343 in 2005 when the Constitutional Court halted sales to foreigners.

After the new law went into effect on Jan. 7, foreigners bought 4,605 properties.

The total area of all properties sold to foreigners is 178.9 million square meters.

The nationalities of property owners in Turkey cover 70 countries. Out of 62,486 foreigners who have bought properties, Britons lead with 14,456, followed by Germans with 14,387.

Greeks who have bought property in Turkey number 13,905, Dutch 3,123 and Syrians 2,485. While Germans, Brits, Greek and Dutch prefer residences, Syrians opted for land or houses with surrounding land.

The bulk of Greek citizens who bought property in Turkey were either Turks from Western Thrace or Turkish immigrants in Greece.

CONTRACTOR DESIGNING HOMES WITH FOREIGNERS IN MIND (Thursday, June 08, 2006, originally compiled by TDN)

After building 1,054 villas in Bodrum, leading construction firm Yapı Endüstrisi is moving on to Çeşme and Istanbul with specially designed projects targeting foreigners.

Leading construction firm Yapı Endüstrisi is planning to build homes designed with foreigners in mind in Istanbul.

“Istanbul has become a center of attraction for foreigners in recent years. Many European Union citizens are looking for opportunities to buy property in Istanbul,” said company executive Süha Yılmaz.

The firm has completed 1,054 villas in Bodrum, with a potential sales value of $250 million. After finalizing their projects in Bodrum, they now plan to move on to Çeşme and Istanbul, where their four projects have an investment value of $500 million.

Yapı Endüstrisi is also considering investing in golf tourism.

One of the Istanbul projects is a complex in Maslak covering 30,000 square meters with a shopping center, residences and offices. Another is a golf, hotel and residential project at Büyükçekmece on a 4,000-acre plot of land.

The company's residential projects are situated on the Anatolian side of Istanbul. Some 350 homes will be built at a central location in Göztepe, and the firm will also build a 1,000-unit housing complex especially for foreigners.

After stating that Istanbul is an appealing city for foreigners, Yılmaz said they had sold around 100 homes to foreigners to date. “There was gap between the annulment of the previous law [concerning sales to foreigners] and the passing of the new law. If that gap hadn't existed, the number of homes sold to foreigners would have been much higher.” 

Their customer portfolio contains predominantly buyers from the UK and Ireland, he said. The company is now planning specially focused projects for the Dutch, Danish and Russian markets.

Diversity is the key to being a brand in construction. “We use different details in every project. For our Sandalet project, we brought pebble stones from Manisa to use in the floors to create a cooling effect. For our Maslak complex, we have hired a world-renowned architect who has never done a project in Turkey before.”

The first project in Çeşme will be a 200-unit apartment building on the seafront. Every home will be equipped with facilities that enable thermal water to flow through the building. Major portions of their projects were launched in 2005 and are planned to be finished in 2007 have already been sold.

Shopping centers mushrooming in Turkey have created an influx of international property investors. Global foreign funds are keeping a close watch on the Turkish property market, especially on malls. From Pradera and Corio to Commerzbank and Deutsch Bank, leading investment funds and other foreign companies are on the move to buy in Turkey

With new housing projects launched and new shopping centers opening one after another, Turkey has become a point of interest for investors looking for a good buy. Prominent foreign investment funds seeking to be at the forefront of the Turkish real estate sector are keeping close watch, primarily on shopping centers.

A London-based foreign investment fund, Aerium Finance, for instance, has recently bought six units of property belonging to Carrefour. Pradera and Corio as well as Commerzbank and Deutsch Bank are all knocking at the doors of the Turkish owners of major shopping centers.

First buyers:

Akmerkez initiated the first sale to foreign investors. A leading European property company bought 49 percent of public shares in Akmerkez in 2005. The next was Aerium, another major international property company. Aerium bought six properties in various locations from Carrefour for YTL 330 million.

Searching for new investment opportunities in Turkey, Aerium is also negotiating with Tepe Natilius and closely watching Carrefour's Merter project, to be launched this year and expected to be completed in 2008

Another shopping center that is attracting the attention of foreign investors is Profilo. Even though officials in Profilo Holding reiterate that there is no “for sale” sign on their property, it is known that day after day a new foreign investor knocks at Profilo's door.

Turkey's largest shopping center in terms of space, Cevahir is yet another point of interest for international investors. The sales process of Cevahir is ongoing. With an investment cost of $300-350 million, more than 10 candidates from Europe and the Middle East are competing with each other, raising the price to $750 million. This figure offered by a British firm was approved by the municipality but project contractor, Cevahir Holding, rejected it.

Metro Group Asset Management (MAM) General Manager Gündüz Bayer said it was only 18 months ago that international investors were attracted to Turkish shopping centers. “Good economic indicators increase the interest of foreigners. The EU process has also had its positive effects. Meanwhile, markets in Western and Eastern Europe have been saturated. Now the funds are being diverted to Turkey. Buying shopping centers is a good investment because returns on investment are swift. An investment fund interested in a shopping center first checks the rental revenue.”

Istanbul has 32 shopping centers. By 2007, 46 new projects will be launched in Turkey, with more than half of them in Istanbul.

This new development for Turkish ID cards will change the lives of Turkish national in a revolutionary way. The act has been passed and published in the Official Newspaper and whether any religious affiliation appears or not on identity cards is now completely optional. Another development in the ID revolution is that any child born outside of marriage will carry the name of their father. Anyone aged 18 or over will be able to change the ‘religion’ section on their cards.

It is now imperative that identity numbers appear on passports and driving licences. In order to avoid false marriages, mukhtar\’s will no longer have the authority to wed people of foreign nationality.

Third parties cannot be given registration information
It is now forbidden to pass on any information about the idenetity card holder to a third party, in order to protect privacy of individuals.