PPF plans Prague Eye skyscrapers

Prague’s 11th district is in the process of approving plans by the financial group PPF to build the highest office tower in the country, right next to Centrum Chodov. The plan is to build a pair of 30-storey buildings, one of which will rise to a height of 138 meters. At the moment, AZ Tower in Brno is being built and will be the highest Czech building (111 meters). The project’s a surprise  to most people, and there were quite predictably some angry local residents on hand at a recent public meeting to denounce it.

HN: UniCredit re-auctioning Na Prikope building

Hospodarske noviny is running with a story about UniCredit bank cancellation of a tender it held to find a buyer for its historic  (and gorgeous) building on Na Prikope in downtown Prague. The paper’s headline reads Tender winner finds out he didn’t win

The “winner” in this case was James Woolf of Flow East, who told the paper “We won the auction…with an offer of €30m” and he says he was told the bank was satisfied with the bid. UniCredit bank isn’t commenting on the matter at the moment, but HN cites “previous media reports” that it was looking to cash in €60m.  It says Flow East isn’t taking part in the current auction for the building, but writes that CPI Group is.

Kind of a strange article, really. Filled with vague winks and nudges from anonymous property experts (who weren’t used in the transaction) implying that the process is legally sound, but odd. It does get Bent Walde-Jensen, head of real estate at KPMG, on record saying “It’s unusual. When you go through a long process, the goal is usually to get cash, and not the initiation of another process.”

Forced sale on the way?

PropertyEU is reporting that Eurohypo may have to opt for a forced sale on a Uni-Invest Dutch-based €865m office portfolio. This follows a breakdown in talks with the bondholders of the Opera Finance CMBS vehicle it created to underpins the assets. “Uni-Invest defaulted on a senior loan balance target in February 2011. Uni-Invest’s EUR 752 mln debt load was already extended in February 2010, and it now comes to maturity in February 2012.” Uni-Invest was taken over in 2003 by Lehman Brothers Real Estate Partners with HVB providing financing. Eurohypo provided financing in 2005, which it extended in 2010 in order to avoid a forced sale.

News (PL): TriGranit, Neocity, Adgar

Adgar prepares office plot
Adgar Group acquired an 8,000 sqm plot for its new investment at Aleja Prymasa Tysiąclecia in the Wola district of Warsaw. The precise plans are at the moment unknown, but Eyal Litwin, vice-chairman of Adgar, revealed that the company intends to deliver further office projects. Until now, Adgar’s biggest project projects (Adgar Plaza, Adgar Business Centre, Adgar Business Centre II) have been built in Mokotów.

Neocity starts with the new scheme
Neovillage estate Neocty’s second investment in Warsaw. The five apartment buildings will offer 148 residential units in the Ursus district. The company is currently waiting to receive a construction permit for the project.

13 new stores in Silesia City Centre
TriGranit’s scheme Silesia City Center has announced a baker’s dozen of new tenants who will inhabit the mall when it opens this fall. The 13 brands are Lacoste, La Promessa, Harpers, Shoes, Rolex, Clarks, Guess Footwear, Stradivarius, Massimo Dutti, Furla, Home&You, Claire’s, Lindex and the travel company TUI.

Curious times at ECM

Milan Janku of the failed developer ECM has said he wants to sell 8 projects and complete five others. Those are worthy goals for most developers, but a bit difficult to pull off for companies that declare themselves insolvent.

It’s also a bit eyebrow-raising that the company’s share price jumped 20 percent yesterday. Raised the eyebrows of Prague’s stock exchange enough for it to halt trading the company’s securities for a bit. Somebody knows something we don’t (for now).

Apollo last bidder for WestImmo?

A day before the supposed agreement on the fate of WestLB, Apollo Global Management was reported to be the last bidder for the bank’s real estate finance unit WestImmo. The offer was headlined at $567m, with WestImmo having reported earnings of €94.8m in 2010. It claims the results were hit by the forced sale, which was a condition of WestLB’s access to state money to save it during the financial crisis.

For what it’s worth, agreement on the method for the break-up of WestLB was reported on Friday, but this was followed Saturday with a warning that local politicians might try to scupper the deal. Frankly, the fact that politicians have such a large say in the matter may be one of the best arguments for a radical change. They always have voters to please, and tight elections tend to bring out everyone’s less-than-rational policy decisions.

West LB break-up agreed

The seemingly unending saga of the break-up of WestLB is entering the endgame, as the German government and regional governmental authorities have agreed to the outline of a restructuring framework. The break-up was forced on the bank by the EU in return for its approval of state aid that kept the bank afloat during the financial crisis. Reuters reports that

The plan sees Germany’s third-largest landesbank – owned by the German state of North Rhine-Westphalia (NRW) and local savings banks – spin off a new bank with a balance sheet of 40-45 billion euros catering for regional savings banks.

The new bank is expected to have just one-tenth of the number of employees that WestLB did. It will have a year to sell off its corporate lending and project financing units, along with its derivatives business. After that, those companies would be placed in WestLB’s bad bank, Erste Abwicklungsanstalt.

Palac Andel update

Some little birds (not involved in the deal) have been whispering in our ears, suggesting that the price (€52m) paid for Palac Andel is likely to reflect a yield in the neighborhood of 6.2 – 6.3, though this is most definitely not confirmed. “It means Prague’s already back in 2005!” says our source. And it supposedly demonstrates that there’s still interest in prime buildings in the city.

Or does it? We’re also hearing that the buyer is actually an insurance fund managed by Aberdeen. So, not a strictly third-party deal. What to make of the price then, which would otherwise dismay some people currently looking to buy in Prague? We’ll be looking for confirmation on all of this, but our sources have a history of being reliable.

The context of the story is that Aberdeen is selling properties to bolster some of its other Degi funds that it plans to re-open. So if a bunch of investors take the opportunity to cash out immediately (as inevitably some will), there should be some reserves in the kitty to cover it.

Why Prague’s stock exchange is so lame

Interesting article in the FT that pretends to be about how the Viennese owners of the Prague stock are planning, someday, to try to make it less of a loser compared with Warsaw’s booming bourse. The reality is that Warsaw is CEE’s financial center, of course. But the article’s a must-read because of the background info about how Czech politicians and regulators botched their chance to provide a local alternative for raising capital (as opposed to just borrowing from banks).

Oil, Libya and Polish shale

Poland’s hoping to get into the oil production game, thanks to high levels of suspected shale oil reserves scattered across the country. This kind of oil is pretty difficult to collect, however, so it’s an opportunity that only becomes viable when oil prices go up. So international news suddenly matters even more. For example, global supply problems caused by the Libyan civil war are therefore great news to the local black gold miners.

Aberdeen reportedly sells Palac Andel

There’s a bunch of squawking in the local Czech news that Aberdeen Immobilien has sold Palac Andel for something north of €52m as part of a strategy to build up reserves ahead of re-opening a couple of Degi funds. The buyer is reported to be Kallisto Neunundvierzigste Vermögensverwaltungs. We’re going to scrape around for some confirmation and details before saying any more on this one (emails welcome, btw). If memory serves, however, Aberdeen bought it from the local real estate fund Realtia for €57m back in 2008 (see CIJ story).

Financing for Andersia Business Centre in Poznan

Andersia Business Centre in Poznan has landed the financing it needs to continue, after choosing Bank Zachodni WBK from a host of bids. Construction work on the foundation has already been completed (by Porr Polska), while above ground works are scheduled to begin in July. A 14-month schedule is envisioned for the €33m, 11,200 GLA building that features floorplates of 2,800 sqm. The project is part of a JV between Von der Heyden Group and the City of of Poznan.