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Reyal Urbis Records Losses Of €34M In Q1 2017

4 May 2017 – Expansión

The property developer Reyal Urbis has presented its results for the first quarter of 2017. During that period, the company, which is chaired by its largest shareholder, Rafael Santamaría (pictured above), generated revenues of €8.9 million, up by 2% compared to the same quarter in 2016. Nevertheless, it recorded losses of €34.35 million during the same period, down by 15%.

The results for the first quarter are the first set that the company has presented after it obtained approval, on 30 March, and following an appeal, for its proposed arrangement, through which it hopes to emerge from the creditors’ bankruptcy in which it has been immersed since February 2013. Four years ago, the property developer was involved in the second largest bankruptcy ever registered in Spain (the first largest was recorded by its competitor Martinsa Fadesa) with debt of around €4,000 million.

The proposal to emerge from bankruptcy, which was first presented in 2015 and then modified by legal requirements, includes the payment of the debt to its banking creditors using assets, to which a discount of more than 80% would be applied. Following the exchange, the property developer would reserve a portfolio of its best assets, including one shopping centre and several hotel establishments, which it would continue to operate if it were to overcome the bankruptcy.

In the case of the Tax Authorities, to which Reyal Urbis owes more than €400 million, the real estate company proposes the complete payment of the liability over the long-term. The creditors have until 30 May, the final deadline, to sign up to this agreement. The bankruptcy administration of the real estate company is being managed by BDO.

Reyal Urbis’ large creditors include Santander and Sareb. In the case of the public entity, an official decision has not been taken yet and the proposal is currently being evaluated. According to Reyal Urbis’ own records, the debt with Sareb amounts to €1,099 million. (…).

The agreement proposal requires approval by 75% of the syndicated lenders and 50% of the ordinary lenders, according to the bankruptcy law in force. (…).

As at 31 March 2017, the group’s liabilities amounted to more than €4,660 million, of which €3,900 million corresponded to debt with financial institutions (including Sareb), more than €122 million represented payments due to suppliers and another €480 million was owed to non-trade creditors.

According to Knight Frank, the group’s real estate assets are worth €1,170 million, of which €191 million correspond to rental assets. Ten years ago, Rafael Santamaría’s real estate company valued the entity’s portfolio at €10,500 million. (…).

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake