Monthly Archives: October 2010

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.

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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.