German Bad Bank Sells Spanish Bluespace Assets & Hotel Arts Debt

31/10/2014 – El Confdencial

German banks wish to cut themselves off the Spanish real estate-related risk. First to take the step earlier this year was Commerzbank that sold €4 billion NPL portfolio called Octopus to Lone Star and JP Morgan.

Now, the bad bank of Germany, FMS Wertmanagement (FMS WM), has put up for sale a €750 million worth of property-backed loans, including the Hotel Arts in Barcelona (pictured) as one of the collaterals.

The luxury hotel was bought in 2006 by a group of investors, among which one could find Host Hotels & Resorts, the Dutch Civil Servants Pension Fund (Stichting Pensionfonds ABP) and company Jasmine Hotels, an affiliate of GIC Real Estate, belonging to the Government of Singapore. The loan amounted to €417 million as at that time banks did not require any cash payment.

Second biggest mortgage bank of Germany, Hypo Real Estate, was among the lenders and afterwards it needed bail-out twice. A part of these loans was included in the now auctioned Project Gaudi, named after the famous Catalonian architect, with the Hotel Arts as the gem collateral.

FMS, German counterpart of Sareb, has run the sale with help of Cushman & Wakefield. Apart from the five-star establishment in Barcelona, Poject Gaudi is made up of 18 loans granted for another high-end hotel in Cascais (Portugal), five shopping and entertainment centers (for instance, the one in the Barrio Art Decó, Madrid), four business parks (for example the one in San Fernando de Henares, Madrid) and Bluespace´s 17 industrial storage rooms scattered around Madrid, Barcelona and Valencia. About one third of the credits are performing, and the rest are sub- or totally non-performing.

Non-binding offers are due on November 14th, and the entire process is expected to close before the end of 2014.


Original article: El Confidencial (by Agustín Marco)

Translation: AURA REE