On Wednesday, Limassol’s town hall witnessed the signing of a pivotal agreement aimed at alleviating the city’s ongoing housing crunch. Following almost two years of negotiations and five years of preliminary planning, the Limassol Municipality and the Cyprus Land Development Corporation (Koag) have finalized a partnership to deliver hundreds of reasonably priced apartments to local residents.
Under the terms of the agreement, the municipality will transfer four land parcels to Koag, which will manage the construction process. In total, 600 residential units are slated for development across Limassol. Ownership of the newly built properties will be divided so that Koag holds 68.25% and the municipality retains 31.75%. Both the land registry office and the State Aid Commissioner have endorsed the deal.
The project’s first phase will take place in the Ayios Nikolaos district, where four apartment blocks totaling 138 units are planned. The budget for this stage is €26 million—€10 million from Koag and €16 million in public funding. A contractor has already been selected to build the initial six-storey block of 36 apartments, with work set to commence once the agreement is formally ratified. This first building is expected to be completed in 18 months, followed immediately by the construction of the remaining three blocks over the next 30 months. All flats will be leased at rates at least 30% below the current market average.
Housing options will include 24 one-bedroom, 72 two-bedroom, 36 three-bedroom, and six four-bedroom units. Allocation between Koag and the municipality will reflect their respective shares of total floor area.
The initiative has garnered strong support from the central government. At a recent public event attended by the President and the Finance Minister, an additional €3 million was pledged to cover municipal tax liabilities related to the development, a move deemed crucial for the project’s viability. Koag will nonetheless be responsible for paying approximately €3 million in VAT on construction expenses.
Attention is already turning to the programme’s next stage. According to Politis, planning permission is imminent for a site in Ayios Ioannis, where 180 more flats across six blocks are proposed. Progress on this phase, however, depends on securing further government funding, as Koag currently lacks the resources to proceed independently. If financing is secured, the same land-for-build model will be applied. Beyond that, phase three envisions an ambitious expansion in Ayios Nikolaos, with nine additional buildings housing 280 flats.
Text based on materials from www.cyprus-mail.com
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