Funds flood the market with real estate
Over 20,000 properties of all kinds are expected to be marketed in the coming years, either through direct sales or auctions. These are the properties that are the collateral of the NPL portfolios, which have been sold or are to be sold in the coming months to investment funds and groups such as Apollo, Bain, and Centerbridge.
Over 20,000 properties of all kinds are expected to be marketed in the coming years, either through direct sales or auctions. These are the properties that are the collateral of the NPLs' portfolios, which have been sold or are to be sold in the coming months to investment funds and groups such as Apollo, Bain, and Centerbridge.
A prime example is Bain Capital, which started its first sales in July, raising over € 35m through the sale of significant buildings. Bain has acquired the Amoeba non-performing loan portfolio, paying approximately € 430 million. It is estimated that about 2,300 of these loans had properties at collateral. Currently, Bain Capital is running its second real estate sales cycle to interested institutional or private investors.
Similarly, Apollo, which acquired the Jupiter package for € 337 million, is finally moving to launch its first sales. This portfolio involved claims of € 1 billion and is estimated to contain over 1,700 mortgages, valued at more than half a billion euros. Most of the properties (about 40%) are residential, some are commercial real estate, and the package includes dozens of hotel properties.
Reportedly, the debt recovery process is currently under way, with the majority of borrowers, at least so far, choosing the auction path. In this context, it is estimated that more than 1,000 properties will be auctioned in the coming months. The start is expected in April and May, when several hundred real estate auctions are already planned. The other option offered to the borrowers by the funds is the consensual sale. In this case, the borrower agrees to sell his property in order to cover his debt. The third alternative is to pay off the debt after a haircut, which means that the debtor keeps the property in his possession.
At the same time, real estate agents note that the process of selling Alpha Bank's more than 70 properties, which were also transferred to Apollo, under Project Jupiter has also begun. These are properties that the bank itself had recovered and included in the package to make it more attractive to the investor. These estates, valued at more than € 50 million, have already been put up for sale by the major real estate companies. It should be noted that this is not a mass sale, as each property is sold individually, as was the case with real estate sold by Bain Capital.
Bain Capital, Apollo Global Management and Fortress, are all seeking to purchase Project Neptune, a portfolio of with non-performing real estate collateral loans, also from Alpha Bank. This portfolio includes 4,000 real estate collateral, with their market value estimated at around € 1.1 billion. 30% of of the properties are commercial. 20% are industrial real estate, and there are also hotels, plots and warehouses.
The first real estate from the Symbol portfolio is expected soon, as well. Symbol was sold a few weeks ago by NBG to the joint venture of Centerbridge Partners, LLP and Elliott Advisors (UK) Limited. This is a portfolio of 12,800 NPLs, with 8,300 real estate collateral. The package was sold for € 250m. As reported by the National Bank, the portfolio will be serviced by Cepal Hellas.
NBG is also expected to decide soon the sale of the other mortgage loan portfolio, Project Icon, which has about 6,000 properties valued at € 1.1 billion. The properties are mainly professional (offices, shops, warehouses), as well as hotels, and also some industrial. 27% of the properties are located in Athens and 23% in Northern Greece.