Tilden Park Acquires 2,500 Homes from Coral Homes

4 January 2020 The fund Tilden Park has paid between 100 and 150 million euros to acquire 2,500 flats from Coral Homes, a company owned by Lone Star (80%) and CaixaBank (20%). Tilden was founded by Josh Birnbaum, a former director at Goldman Sachs who became famous for his bets against the US sub-prime mortgage market, as depicted in the film “The Big Short.” The homes were part of the Kingfisher Project.

The fund made its first investment on the Iberian Peninsula in November when it acquired 1,800 toxic loans and 180 REOs from BPI, a subsidiary of CaixaBank in Portugal.

El fondo Tilden Park ha adquirido 2.500 pisos a Coral Homes, una compañía propiedad de Lone Star (80%) y CaixaBank (20%), por entre 100 y 150 millones de euros. Tilden fue fundado por Josh Birnbaum, un exdirector de Goldman Sachs que se hizo famoso por sus apuestas contra el mercado hipotecario de alto riesgo en los Estados Unidos, como se muestra en la película “The Big Short”. Las casas eran parte del Proyecto Kingfisher.

El fondo realizó su primera inversión en la Península Ibérica en noviembre cuando adquirió 1.800 préstamos tóxicos y 180 REO de BPI, una filial de CaixaBank en Portugal.

Original Story: El Confidencial – J. Zuloaga

Translation/Summary: Richard D. Turner

Sareb to Sell Portfolio of Unfinished Developments

4 January 2020 Sareb is looking to finalise the sale of Project Esla, a portfolio of collateralised developer loans that it put on market almost two years ago. Esla is the first project of partially-built developments that the bad bank has attempted to sell.

The financial institution is reportedly creating a Bank Assets Fund (FAB) to sell the portfolio, the second time it has done so. The vehicle was designed for Sareb, with the advantage that it is taxed at a rate of just 1%, compared to a normal rate of 25%. The Spanish government created the structure to entice institutional investors to acquire the bad bank’s toxic assets.

An unnamed firm and Sareb are said to have already reached an agreement to sell the portfolio for approximately 150 million euros, including the necessary investments to complete the developments.

En español

Sareb está buscando finalizar la venta de Project Esla, una cartera de préstamo promotor con garantía que lanzó al mercado hace casi dos años. Esla es el primer proyecto de urbanizaciones parcialmente construidos que el banco malo ha intentado vender.

Según los informes, la institución financiera está creando un Fondo de Activos Bancarios (FAB) para vender la cartera, la segunda vez que lo ha hecho. El vehículo fue diseñado para Sareb, con la ventaja de que está sujeto a una tasa de solo el 1%, en comparación con una tasa normal del 25%. El gobierno español creó la estructura para atraer a los inversores institucionales a adquirir los activos tóxicos del banco malo.

Se dice que una empresa no identificada y Sareb ya han llegado a un acuerdo para vender la cartera por aproximadamente 150 millones de euros, incluidas las inversiones necesarias para completar los desarrollos.

Original Story: El Confidencial – Ruth Ugalde

Translation/Summary: Richard D. Turner

Bain Capital Hires JP Morgan and Deloitte to Securitise NPLs

18 December 2019 – Bain Capital has hired JP Morgan and Deloitte to sell off all of the non-performing loans it acquired in Spain during the crisis. The portfolio has a nominal value of approximately €4 billion, though it is likely to sell at a significant discount.

The firm is looking to securitise the portfolio of NPLs. The credits would remain in the same companies, but any new investors would assume the risks and the potential profits.

Market analysts believe that Bain’s decision is linked to two major factors. First, the entrance of Unidas Podemos into the governing coalition, together with the Socialists, an second the expected coming change in the economic cycle. Both have been roiling the market in the last few weeks.

Original Story: El Confidencial – Jorge Zuloaga

Adaptation/Translation: Richard D. K. Turner

The Pace of NPL Sales Falters in Spain

6 December 2019 – Spanish banks have reduced their pace of sales of NPLs this year, as CaixaBank, Sabadell, Bankia, Bankinter, Unicaja and Liberbank unloaded a total of just 4.9 billion euros in the first nine months of 2019. Those financial institutions wrapped up the quarter with €35.006 billion of such assets on their books, 12% less than at the beginning of the year. In contrast, Spain’s banks in sold off €90 billion in non-performing loans and REOs in 2018.

Standard & Poor’s, on the other hand, published a report in February estimating that Spain’s banks should rid themselves of €30 billion in NPLS between 2019 and 2020. That figure would have lowered their collective NPL ratio to below 4% compared to 7% at the time. Both S&P and Spain’s central bank also argued that the banks needed to increase the pace of sales to prepare for a potential slowdown in the economy.

Original Story: El Economista – Eva Díaz

Adaptation/Translation: Richard D. K. Turner

 

Sareb Chooses Haya Real Estate to Manage €8.4-Billion Real Estate Portfolio

5 November 2019 – Sareb announced that it has opted to renew its management contract with Haya Real Estate. Haya had already been acting as a servicer for a portfolio of loans and real estate worth €8.4 billion (net book value as of 12/31/18). The new contract will last for 30 months.

The contract is part of Sareb’s new business strategy whose ultimate goal is to “preserve or improve the value of its assets.” DC Advisory advised Sareb on the deal.

Original Story: Cinco Dias – A. Simón

Adaptation/Translation: Richard D. K. Turner

Spain’s Banks Look to Sell €19 Billion in Real Estate Assets and NPLs in 2019

21 October 2019 – Although the pace of sales has fallen in recent years, Spain’s banks are continuing their efforts to reduce their exposure to non-performing loans and foreclosed real estate assets left over from the financial crisis of the first half of this decade. In the year to date, those banks have sold portfolios of toxic assets worth a total of more than €7 billion. Another twelve other transactions worth approximately €11.7 billion, however, are on course to conclude by the end of this year.

Sabadell has been particularly active, having sold €2.55 billion in portfolios such as Greco and Rex. Unicaja and Ibercaja have also sold assets worth more than €1.5 billion. Santander is currently negotiating the sale of another two portfolios.

Spain’s financial institutions are expected to end the year with total sales of nearly €19 billion, compared to 41.7 billion euros last year, down by more than half.

Original Story: El Español – María Vega

Adaptation/Translation: Richard D. K. Turner

Santander to Sell Two Portfolios of Land and NPLs Worth Nearly €6 Billion

21 October 2019 – Santander is finalising plans to sell two major portfolios of NPLs and REOs, worth a total of approximately 6 billion euros. The bank has already contacted major potential investors to prepare themselves to analyse two portfolios: €2.7 in NPLs, called the Project Atlas, and another €3 billion in land.

Santander has been analysing the portfolios since the spring of this year. The bank is looking to increase the pace at which it is reducing its exposure to the Spanish real estate market. According to publicly available data, Santander had €12 billion worth of NPLs and another €10 billion in foreclosed properties as of June.

These would be the financial institution’s largest divestments since 2017, when it sold €30 billion in assets it had inherited from Banco Popular to Blackstone. Market sources believe that the bank will only finalise the sale during the first quarter of 2020, due to its size and complexity.

Original Story: El Confidencial – Jorge Zuloaga & Ruth Ugalde

Adaptation/Translation: Richard D. K. Turner

Sareb Close to Awarding €8-Billion Contract to Service Real Estate Portfolio

21 October 2019 – Sareb has chosen two finalists to vie for the management contract for €8 billion in loans and real estate: Haya Real Estate, controlled by Cerberus, and Servihabitat, by Lone Star. The bad bank expects to award the contract, which is the largest currently on the market, within the next few weeks. The existing contract, with Haya RE, is set is expire, which led Sareb to seek to reduce its costs.

Sareb opted in the spring of this year to place the contract on the market again, to lower its associated costs. Principally, the firm is looking to pay less in management fees, while paying more for successful sales and placements. Until now, the bad bank has been paying roughly €100 million per year in fees.

Four other groups had been vying for the contract: DoValue’s Altamira AM, Intrum’s Solvia, Finsolutia, and Hypoges. However, three other contracts, currently with Solvia, Altamira and Servihabitat, are set to expire in 2021.

At the same time as Sareb is looking to reduce its fees, the contract, known as the Project Esparta, includes the bad bank taking on more responsibility for the assets. The change has reduced the size of the portfolio in play from about €11 billion (at net book value) to roughly €8 billion now. The new servicer’s activities will be limited to selling or renting any properties, while Sareb will take on many of Haya RE’s previous duties.

Original Story: El Confidencial – Jorge Zuloaga & Ruth Ugalde

Photo: EFE / Emilio Naranjo

Adaptation/Translation: Richard D. K. Turner

Santander Studying €12-Billion Sale of NPAs

20 August 2019

Banco Santander is considering a potential sale of a €12-billion portfolio of real estate loans by the end of the summer.

The bank is looking to improve its capital ratios in Spain, which are still weighed upon by assets the bank took over from Banco Popular, in spite of a €30 billion sale of assets to Blackstone in 2017, Project Quasar.  On Tuesday, the bank reported that its NPL ratio stood at 7%, above rival banks such as BBVA Spain (-4.9%) and CaixaBank (-4.6%).

Original Story: El Confidencial – Jorge Zuloaga

Adaptation/Translation: Richard D. K. Turner

Spain’s Banks Continue to Suffer from High Levels of Exposure to Non-Performing Real Estate Assets

13 August 2019

Spain’s largest financial institutions still have more than 37 billion euros worth of non-performing real estate assets on their books, not counting non-performing loans, even after a series of major disinvestments over the past two years. The bank with the most significant exposure, Santander, sold €30 billion in assets to Blackstone; while BBVA sold another €13 billion to Cerberus. CaixaBank unloaded a €12.8 billion portfolio to Lone Star as Banc Sabadell sold assets totalling €10.1 billion to Cerberus and Oaktree.

EU banking regulators are pressuring the banks to quickly reduce their exposure even further, setting a high bar for the expected pace of disinvestment over the coming years.

Santander still has €10.132 billion in foreclosed assets, over 16% more than the bank with the second-highest exposure: Sabadell (€8.732 billion). Santander’s exposure to land is especially high, with a portfolio with a gross value of €4.37 billion. Thus, the bank recently created a company to prepare the portfolio for an eventual sale. The new company, Landmark Iberia, has 400,000 square meters of developable land for sale.

Original Story: El Confidencial – Jorge Zuloaga

Adaptation/Translation: Richard D. K. Turner