21 May 2019 – Cinco Días
Banco Sabadell put its property development arm Solvia Desarrollos Inmobiliarios (Sdin) up for sale several months ago. Initially, the bank was expecting to receive proceeds of around €1 billion for the company, its employees and land. However, in light of the current climate, it is now revising down its expectations.
Investment funds are starting to face problems when it comes to generating returns from their investments in land and property what with many of the large property developers, such as Neinor Homes, slashing their short-term forecasts, the political uncertainty following the recent general election and the general nervousness that the current boom cycle is coming to an end.
As a result, the bank chaired by Josep Oliu (pictured above) is now hoping to receive binding offers amounting to around €900 million, which would considerably reduce the entity’s expected gains from the sale. Nevertheless, SDin owns around 300 prime plots and 130 promotions under development, whose combined valuation amounts to €1.3 billion, according Savills Aguirre Newman.
For the time being, Sabadell has four offers on the table from investment funds, including from Cerberus and Oaktree. The fund Kronos is also still in the running although it is less likely to prove victorious.
Sabadell had initially planned to close this operation by the end of June, but may now wait a little longer.
Original story: Cinco Días (by Ángeles Gonzalo Alconada)
Translation/Summary: Carmel Drake