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
30 July 2019
Sareb has notified the four servicers that manage its €34 billion in real estate loans and assets that it will open up bidding on its management contracts to other potential bidders, after having received a round of offers that it considered insufficient. Haya Real Estate (Cerberus), Servihabitat (Lone Star), Solvia (Intrum) and Altamira (doValue) have been servicing the bad bank’s assets until now. Sareb mandated DC Advisory to manage the process as the bank looks to reduce the size of the commissions it has been paying to the four firms.
DC Advisory and Sareb have reportedly been in contact with smaller, specialised firms such as Hipoges, Finsolutia and Copernicus. The decision is a message to the four current servicers, letting them know that they may lose out on future contracts unless they improve their bids. Sareb is considering dividing some sections of its portfolio by geographical location, reducing the number of managers in each and streamlining its operations.
The process – known as the Project Esparta – sent shudders through the servicing sector and was a factor in the postponement of Haya Real Estate’s IPO last year. Haya currently has the largest mandate, servicing 37% of the bad bank’s assets (2014). Altamira, in turn, manages 29%, while Servihabitat has 19% and Solvia 15%.
Original Story: El Confidencial – Jorge Zuloaga
Adaptation/Translation: Richard D. Turner
17 May 2019 – Cinco Días
Sareb has launched a new operation called Project Esparta, through which it is seeking to turn its existing strategy on its head.
The bad bank’s aims with this initiative are multiple: to create sub-portfolios into which to classify its assets; to renegotiate the contracts with its servicers to recover the services transferred to them; to delay sales and assume the stock of assets to generate added value; to create regional centres; and to equip itself with its own technological infrastructure. The overall objective is to professionalise sales and enhance the value of its assets.
As a result, Sareb is going to start renegotiating the contracts that it has with Haya, Altamira, Solvia and Servihabitat to recover some of the activities assigned to those servicers. Haya’s contract is due to expire on 31 December 2019 and according to the bad bank, it may be renewed in part or in whole, or the portfolio under management may be put up for tender. The contracts with Altamira, Solvia and Servihabitat are due to terminate in 2021.
Haya was hoping to make its stock market debut this year, but it will have to put those plans on hold until its future with Sareb is resolved.
Original story: Cinco Días (by Ricardo Sobrino)
Translation/Summary: Carmel Drake