* Confident mall complex injunction will be lifted
* Says close to completing deals on other projects
* Sees mall complex adding 6-8 euros on NAV
(Adds details, background, other projects)
By George Hatzidakis
ATHENS, Jan 30 (Reuters) - Greece's largest real estate developer Babis Vovos (BVIC) is confident a court injunction that stopped work on its biggest project will be lifted, helping efforts to buck a construction downtrend, its CEO said.
Greece's building sector has hit a slump as the global credit squeeze begins to hit home. BVIC is banking on a shopping mall, set to cost the company 250 million euros, in Athens's underdeveloped Votanikos suburb to help it counter the trend.
But construction was halted last month after a temporary court injunction, resulting in a sharp stock price drop. Vovos has appealed the decision, ahead of a final supreme court ruling scheduled for March 6.
"We strongly believe that the court will lift the injunction, and have had indications to this effect. We have a very strong case," BVIC chief executive Aris Vovos told Reuters. "We also expect a favourable ruling in the final court case."
BVIC expects about 35 million euros annually in rental income from the project, just 3 kilometres from the city centre. The development was originally planned to reach completion by the end of the year, with its market value projected at about 600 million euros.
But a challenge to the development, brought about by a group of 130 residents on environmental grounds resulted in the injunction which now threatens to delay completion and postpone a significant cash injection for the company.
SHARES HURT
Vovos shares trade about 3 times estimated 2008 earnings, compared with an average 7.7 multiple for its European peers, according to Reuters data. The discount is mainly due to concerns over Votanikos, analysts say.
BVIC shares have lost about two-thirds since early December, with current Net Asset Value (NAV) at about 20 euros. Votanikos is seen adding about 6-8 euros to NAV by completion, Vovos says.
Construction, a key driver of Greece's economy, fell 16 percent in the 10 months to October 2008 and analysts say these kinds of developments are key to keeping the sector afloat.
Greece's largest re-development project since World War II also foresees construction of a 42,000-seat stadium for Panathinaikos soccer club, 70,000 square meters of gross lettable area and over 30 acres of green space.
The project will provide about 2,000 permanent jobs in what has traditionally been amongst the city's poorest districts.
"We just want to ensure minimal time delays," Vovos said.
Still, despite the delay, BVIC is moving ahead with other projects that will continue to provide an inflow of cash, tapping continued demand for business space.
"We have other investments in the pipeline and have had interest for other projects that are close to being finalised," Vovos said. "Already there is interest for two 15,000 and 30,000 square meter office projects."
BVIC is also set to complete a tourism project on the island of Poros, where interest has been expressed by a Russian fund. (Editing by Jon Loades-Carter)