The Association of Large Investment Projects on Tuesday released a statement commenting on the scarcity of affordable housing, delving into the ramifications this issue poses.

The association explained that that this challenge, combined with the generally low availability of housing units, demands immediate resolution.

According to the association, a “critical concern is maintaining Cyprus’ appeal as a destination for corporate headquarters, which necessitates prioritising housing for employees of large companies”.

It said that “the current housing shortage has become a major deterrent to relocating corporate headquarters to Cyprus”.

“The benefits of headquarters are undeniable,” the association stated.

“Establishing corporate headquarters in Cyprus enhances the overall economic product of the island,” it added.

It explained that such investments “generate new jobs, foster technological innovation, and bolster the local economy“.

Additionally, it noted that “these headquarters capture international business interest and are pivotal in enhancing trade and investment in Cyprus”.

“On a political level, it enhances the business climate and eases investment,” the association said.

“Economically, it increases the country’s competitiveness, contributing to rises in employment, GDP, and commercial activities,” it added.

Moreover, the association pointed out that with the continued development of infrastructure and government support, Cyprus is poised to cultivate an investment-friendly environment, solidifying its position as a global hub for corporate headquarters.

However, the challenge of securing affordable housing for employees and their families, due to a lack of residential units and rents soaring “has emerged as a significant stumbling block”.

According to the association, “this challenge could lead some companies to rethink relocating their headquarters to Cyprus or dissuade new establishments despite Cyprus’ initial attractiveness”.

This situation underlines the complexity of the issue and underscores the need for strategic and comprehensive planning.

The association said that the government can facilitate the construction of employee housing by foreign companies through specific incentives, such as increasing the building rate in designated areas, which will help alleviate the housing shortage.

Moreover, the association said that addressing inefficiencies in the development licensing system is crucial.

“Despite attempts to streamline processes, the transition to newly established environmental impact assessments (EIAs) continues to delay approvals,” it said.

“These delays exacerbate the housing crisis and inflate prices, creating barriers to attracting new investments and, by extension, headquarters,” the association added.

What is more, the association stressed that “effectively leveraging technology is key to fostering a more business-friendly environment”.

“The delays have proven to be detrimental to Cyprus’ competitiveness, obstructing investment opportunities that could significantly benefit the local economy and Cypriot society,” it added.

“These unresolved issues could severely impact the country’s economic and strategic objectives,” the association concluded.