Real Estate Investments in High-Risk Earthquake Zones
Pelin Gungor
The recent earthquakes in Turkey have caused significant damage and loss of life, highlighting the importance of earthquake preparedness and response efforts. The first earthquake, with a magnitude of 7.8, was the strongest to hit Turkey in over 20 years and caused widespread destruction in the region. The earthquake was centered near Gaziantep, a city in south-central Turkey that is home to many Syrian refugees and humanitarian aid organizations. The earthquake caused buildings to collapse, trapping people inside and leading to a significant loss of life. Just nine hours later, a magnitude 7.5 earthquake struck approximately 59 miles southwest of the first earthquake. This second earthquake compounded the damage and made rescue and recovery efforts even more challenging.
Turkey is located on a major fault line and is prone to earthquakes. However, the country has made significant efforts to improve its earthquake preparedness and response capabilities in recent years. Despite these efforts, the recent earthquakes serve as a stark reminder of the need for continued investment in earthquake preparedness and response efforts. International organizations and aid agencies have responded quickly to the earthquakes, providing critical support to those affected. However, ongoing support will be needed to help communities recover and rebuild in the aftermath of these devastating events.
The recent earthquakes in Turkey serve as a reminder of the need for ongoing investment in earthquake preparedness and response efforts. While significant progress has been made, there is always more that can be done to protect communities and mitigate the impacts of earthquakes. The international community must continue to support Turkey and other earthquake-prone regions around the world to ensure that they are prepared to respond to future earthquakes.
Real estate investors are increasingly becoming aware of the risks associated with natural disasters, particularly earthquakes. While they are still interested in seeking lucrative short-term yields and long-term appreciation, investors are also considering the value for money and the resilience of the building against high earthquake risk.
What Are the Risks ?
Investors understand that natural disasters can cause significant damage to properties, leading to a loss of rental income and a decline in property value. Therefore, they are looking for properties that are built to withstand earthquakes and have been designed with seismic resilience in mind. This means that the building should have a strong foundation, reinforced walls, and other structural features that can withstand the impact of an earthquake.
Moreover, investors are also looking for properties in areas that are less prone to earthquakes. This includes areas that have a lower risk of seismic activity or are not located on major fault lines. By investing in properties in these areas, investors can minimize the risk of property damage and protect their investments.
Another factor that investors are considering is the cost of earthquake insurance. Properties in earthquake-prone areas generally require higher insurance premiums, which can significantly impact the property's return on investment. Therefore, investors are looking for properties that are located in areas with lower insurance premiums, which can reduce the overall cost of ownership and increase the property's value.
Real estate investors are becoming increasingly critical in picking their investment properties. They are not only seeking lucrative returns but also considering the value for money and the resilience of the building against high earthquake risk. By investing in earthquake-resilient properties in low-risk areas, investors can minimize the impact of natural disasters on their investments and ensure long-term profitability.
Greece
Greece is at high risk for earthquakes due to the location of its tectonic plates. Athens, being the capital and one of the most populated cities in Greece, is at risk for earthquakes too. The high-risk earthquake zones in Greece are mainly along the Hellenic arc, which extends from the western Peloponnese to the eastern Aegean Sea. Some of the most high-risk areas include:
1. Eastern Aegean Sea and the Dodecanese islands
2. Gulf of Corinth and the western Peloponnese
3. Southern Crete and the Libyan Sea
4. Northern Greece and the surrounding areas of Mount Olympus
5. Attica region, including Athens and the surrounding suburbs
These areas are prone to seismic activity and experience earthquakes frequently. Greece lies in a seismically active region due to its location at the African and Eurasian tectonic plate boundaries.
There have been several earthquakes in Athens in recent years, with the most significant being the 1999 earthquake that had a magnitude of 6.0 and caused considerable damage and loss of life. To prepare for earthquakes and minimize damage, following the guidelines and instructions provided by the government and local authorities is always recommended. This may include avoiding constructing buildings in high-risk earthquake zones, retrofitting buildings to make them more earthquake-resistant, and preparing an earthquake kit with essential supplies.
Greek Policies
The Greek state and policymakers have taken several precautions against the earthquake risk in Greece, including:
1. Building codes: Greece has strict building codes designed to withstand earthquakes. Since the 1980s, building codes have required reinforced concrete construction, and building inspections are regularly conducted to ensure that structures comply.
2. Emergency response plans: The Greek state has developed comprehensive emergency response plans to deal with the aftermath of earthquakes. These plans include coordinating rescue efforts, providing emergency medical care, and distributing food and water to affected areas.
3. Earthquake monitoring systems: Greece has an extensive network of seismic monitoring stations that provide real-time data on earthquake activity to scientists and emergency responders. This helps them to quickly assess the severity of an earthquake and take appropriate action.
4. Public awareness campaigns: The Greek government regularly conducts public awareness campaigns to educate citizens on earthquake safety measures, including how to prepare emergency kits, how to secure furniture and appliances, and how to evacuate buildings safely.
5. Infrastructure improvements: The Greek government has invested in improvements to critical infrastructure, such as bridges, tunnels, and airports, to ensure that they are able to withstand earthquakes. In addition, the government has implemented seismic upgrades to existing buildings and developed seismic hazard maps to guide future construction.
Construction companies in Greece have several responsibilities while building new development projects in high earthquake-risk areas. These include:
1. Design and planning: The construction companies should ensure that the design and planning of the building project are done in compliance with the relevant building codes and regulations. They should also consider the local geological and environmental conditions to ensure the building can withstand earthquakes.
2. Material selection: Construction companies should use high-quality building materials that can withstand seismic activity. They should also ensure that the materials used in the construction are of the appropriate strength and durability per the seismic zone.
3. Foundation structure: The foundation structure of the building should be designed and constructed to withstand the impact of an earthquake. Adequate reinforcements like steel or concrete should be used to sustain the load of the building.
4. Regular Inspection and Maintenance: After construction, the building should be inspected and maintained to ensure proper functioning and safety. Regular inspection and maintenance can reveal potential risks or vulnerabilities and allow developers to address them before any harm is done.
5. Adherence to building codes: Construction companies need to stick to the applicable building codes and regulations. Building codes require all buildings to follow given standards to be considered safe, so they must comply with these regulations during construction to ensure that the building complies.
Overall, construction companies have a crucial role in ensuring the safety of buildings in high earthquake-risk areas in Greece. By following the relevant building codes and regulations, using high-quality materials, and designing and constructing the foundation structure of the building appropriately, they can help ensure that the new development projects survive in the event of an earthquake.
It is well-known that Greece is located in a highly seismic region, and earthquakes are frequent. The Greek government has introduced building codes and regulations in recent years to minimize the risk of damage from earthquakes. Buildings designed and constructed according to these regulations are safer than those that were built before they were implemented. It is always recommended to seek expert advice before investing in new development to ensure it meets current safety standards.
When investing in a development project, it is essential to ensure that the construction company delivers the property at the promised date and meets the required quality standards. In case of doubt, hiring a third-party engineer to inspect the development project regularly can provide reassurance and help mitigate risks. A third-party engineer can provide an objective assessment of the project's progress and quality, ensuring that it meets the required standards and specifications. They can also identify potential issues and provide recommendations for corrective action before they become major problems. Regular inspections by a third-party engineer can also help to ensure that the project is progressing according to schedule. This can be particularly important in cases where delays can result in significant losses for investors.
Moreover, a third-party engineer can also help ensure that the construction company is adhering to all relevant safety regulations and guidelines. This can help to prevent accidents and minimize the risk of injury or damage to property.
In conclusion, hiring a third-party engineer to inspect a development project regularly can provide reassurance to investors and help mitigate risks. By ensuring that the project meets the required quality standards, adheres to safety regulations, and progresses according to schedule, investors can protect their investment and ensure that the property is delivered at the promised date.
