18 January 2016 – El Economista
Sareb, also known as the “bad bank” has set aside €45 million to spend between now and 2018 on the appraisal and revaluation of all of the real estate assets that it owns, in accordance with the new accounting legislation issued by the Bank of Spain.
The President of Sareb, Jaime Echeogyen (pictured above), has said, in an interview with Idealista News, that the entity had appraised 60% of its registered properties by the end of 2015.
Echegoyen, who will celebrate his one year anniversary at the helm of Sareb in February after he replaced Belén Romana, said that 40% of the remaining properties will be valued by “cloning the results that have already been obtained on the basis of similar properties located in the same area”.
In this way, Sareb will comply with the Bank of Spain’s accounting legislation, which establishes up to three methods for estimating possible corrections to the value of these properties in order to ensure that they reflect market price.
According to the legislation, Sareb must value at least 50% of the assets it has acquired that are still on its balance sheet at year-end 2015 and all of them by 31 December 2016.
Echegoyen is optimistic about the (expected) performance of the real estate market this year and believes that the entity is now starting a “second phase”, in which it will consolidate the sale of its assets as well as recover loans from borrowers.
“We think that 2016 is going to be a very positive year, but we must do things in a calm fashion”, said Echegoyen after highlighting that the entity’s work over the last three years has involved classifying and valuing almost 200,000 assets, of which around half were homes, land, commercial premises, industrial warehouses and hotels.
The objective of Sareb’s President is to find buyers for those developments that were left unfinished and those that have been finished but have been left empty and he asserts that it is still too soon to talk about demolition.
Echegoyen thinks that “there is a lot of interest in land” and he says that “in the current environment, it is likely that many savers will invest in a home to rent it out”.
In this sense, he indicates Sareb’s goals in the social sphere, which include: to provide commercial premises to self-employed people and entrepreneurs at “reasonable rents” and to offer land that does not have development potential “for the cultivation of allotments in exchange for a rustic farm income”.
Original story: El Economista
Translation: Carmel Drake