WestImmo sale date could be pushed back

Disappointingly low bids for WestImmo are being used to try to push back the date by which it’s supposed to be sold off. WestLB originally had until the end of the year to complete the sale, but having received what it described as disappointingly low bids (reportedly from Aareal and Apollo Management), it has asked the German government to file for an extension with the European Commission.

Morgan Stanley to close P2

The long-expected consolidation in property funds is upon us. Despite recent claims to the contrary, Morgan Stanley has announced it will close down, rather than re-open its €854m P2 property fund. Managers will sell off the 34 properties it holds and distribute the proceeds to the fund’s investors, most of whom are German. As with DEGI’s liquidation, these payments will be made twice per year. P2 was closed two years ago at the height of the financial crisis, and had until November 1 to open. Morgan Stanley blamed a recent liquidity squeeze for its unwillingness to re-open the fund and opt for liquidation.

“This is a crisis that’s been on the horizon for some time,” said Jan Hagen, who teaches students about banking and other financial services at Berlin’s European School of Management and Technology. “The whole asset class is coming under pressure because of the risks these funds present — something that wasn’t visible in the past.”

New rules are being drafted to reduce the liquidity risks faced by property mutual funds, including a proposed €5,000 cap monthly maximum for withdrawals, and imposing a minimum two-year investment (with charges for withdrawals made in the third and fourth year).

CIJ Awards Poland’s orphanage charity drive

Preparations are almost complete for the annual CIJ Awards Poland next week on November 4. To be held this year at the InterContinental Hotel in downtown Warsaw, it will be the ninth time the event has taken place. The 2010 edition of the awards will be accompanied by a charity drive for the Warsaw-based Orphanage No. 4, a co-educational institution that cares for children and adolescents aged 3 to 18 years. Along with providing a home for orphans, the center also provides a safe haven for neglected children who find themselves in difficult circumstances. These children are placed in the care of the orphanage on the basis of rulings by Polish family courts. Orphanage No. 4 currently cares for 30 children.

These times are difficult ones for all companies and professionals in the real estate sector, but as the holiday season approaches, it’s worthwhile remembering that there are those among us in real need. It’s incumbent upon us all to support those institutions on the front lines of providing this kind of service to society’s most vulnerable.

A collection will be made on the evening of the awards. For further information on this charity drive or about the CIJ Awards Poland event in general, please contact Anna at mieczkowska (at) cijjournal.com

Q3 GDP jumps in UK

Just as people started panicking over the UK sliding back into recession, GDP goes and rises 0.8% in Q3. That sort of growth hasn’t been seen since Q3 2007.

Along with being a whopping 0.4% higher than those surly economic analysts expected, the construction sector leaped a full 4% on the back of a 9.5% increase in Q2. Austerity hasn’t gone away, of course, nor have the miserable housing numbers. But growth could hit 1.8% for 2010, better than some had feared.

CPI strikes again with Longin BC

Local investors are in control of the Czech investment market at the moment, and it’s CPI that’s at the front of the line. In yet another deal to have gone its way, CPI has purchased the 11,000 sqm Longin Business Center in Prague 1 for €29.3m. Developed originally by ECM, the property, which CPI bought from Invesco Real Estate, includes 55 extended-stay apartments run by Marriott.

CPI’s been busy in 2010, having already bought the Nestle headquarters in Prague 4; around 2,700 residential flats; and it’s believed by many to be in the running for Finep’s City West office park. Oh, and last week it bought a factory in Brandys nad Labem last week in an auction, and is thought to have nearly acquired the IGY shopping center in Ceske Budejovice.

Letterstone’s Silver Resort in Tatra on hold

The Slovak weekly Trend is reporting that Silver Resort, a recreational residential resort project developer in the Tatra mountains, has ground to a halt, and that its developer Letterstone has offered to return 50% of any deposits paid (under certain conditions). Trend says the financing bank VUB has stated that the project has been hit by delays and that it hopes construction would begin again as soon as possible. Construction did begin on the project last year, but never progressed particularly far.

CTP sells Bohlen & Doyen

CTP has sold Bohlen & Doyen four €62 million to S. AG in a deal completed last week. Having bought the company out of bankruptcy in a 2007 asset deal for€23.5m, it retained the real estate holdings and sold the operations business. The developer intends to use the revenues made from the deal to fund its development pipeline, which is expected to enlarge the total portfolio by around 8% per year. This should translate into approximately 120,000 sqm of lettable space annually. CTP reports that its portfolio currently enjoys 8% vacancy that its revenues for 2010 will hit €96m.

LVMH takes 17% stake in Hermes

Continuing our stroll through ancient mythology, a rhetorical question: if you could get a Hermes bag at half price, would you snap it up? Of course. How about 15 million shares in the company, at a 50% discount? That’s what Bernard Arnault, the owner of the luxury goods conglomerate LVMH has managed to do, giving him a 17% stake in the company. Just how he managed to do this, totally under the radar, is a mystery. France’s richest man has clearly been working hard while his compatriots were busy striking…

The ongoing subprime post-mortem

At the beginning of the subprime mess, there was a tendency to blame overactive American mortgage brokers for flogging dangerous loans to reckless homeowners. That, of course, was the least of it, as this link at CreditWritedowns makes blindingly clear. It’s a long post more suited to weekend reading, so here’s an excerpt from testimony given by Richard Bowen, former senior vice-president and business chief underwriter with CitiMortgage Inc.

New name for Pirelli

The whole renaming fad continues apace. Pirelli RE announced earlier in the year that it would be carrying out a rebranding as it separated itself from Pirelli &C. That means that from today, officially, it will now be known as Prelios. Along with kinda sounding like the old name, the explanation is that it’s the first three letters of “premium” the last four of “helios” — the sun in Greek mythology.

Axa to activate property lending

Axa chief Pierre Vaquier says that given the lack of property lending from banks, he’d like his company to give it a go.

“There’s a lot of attraction to this kind of a product from insurance companies,” said Pierre Vaquier, chief executive officer of Axa Real Estate Investment Managers. Senior loans, which take priority for repayments in the case of a default, yield 2 to 3.5 percentage points more than other debt and so provide a higher return.

Good news!

As requested, a trickle of good news is beginning to flow in. (Will update as appropriate)

-CB Richard Ellis reports that the CEE property investment market registered 22 transactions with a total volume of over €1.5 billion in Q3 2010, close to a 60% increaseon Q2 figures. Quarterly investment volume has not been this high in two years. Year-to-date turnover is close to €3.3bn compared to the total turnover of €2.6bn in 2009 as a whole.

-Wilson & Partners are pleased to announce the strengthening of their practice with the addition of Pavel Raboch as a junior corporate and finance lawyer from Clifford Chance and Tamara Worboys as a senior UK registered lawyer with over 15 years experience in the field of commercial property.

-ProLogis leased 6,800 sqm to a third-party logistics provider and division of the largest book wholesaler in the Czech Republic and Slovakia. The company will operate its regional distribution hub at ProLogis Park Ostrava Building One, located 14 km west of the Ostrava city center, off the D47 motorway.