El Corte Ingles Deploys Property as Collateral in Its New Financial Framework

2/09/2014 – Expansion

The scope of real estate owned by El Corte Ingles and accumulated over the fifty years of the companys expansion in Spain has become a very useful tool in the new financial framework of the group.

Many of the hundreds of units  in hands of the company served as collaterals when the chain was negotiating with its lenders in November last year. For instance, at that time El Corte Ingles mortgaged several shopping malls valued at €435.1 million in total.

In July 2013, El Corte Ingles received an asset appraisal carried out by Tinsa. The report focused on the firms portfolio which included 86 large warehouses (two of them located in Portugal), 42 hipermarkets and over 250 stores, as well as the Torre Titania Tower in Madrid.

In accordance with the market prices of that time, the entire portfolio has been valued at €18 billion, more than enough to pay-off the chains €5.7 billion indebtness.

Despite the appraisal figures, El Corte Ingles maintains properties in its balance sheets are not worth of so much. According to the firms financial report, the value of its lands and constructions was €10.59 billion at the end of 2013, while a year before the volume represented €10.41 billion.

Last year, the chain closed sales of two properties, one located on the Plaza de Cataluña square (Barcelona) and the other on the Preciados street (Madrid), both transferred to IBA Capital for joint amount of €150 million.

  Original article: Expansión (by Rocío Ruiz)

Translation: AURA REE