Frankfurt, Europe’s largest financial city, suffers from high interest and real estate deals (getty)
It’s a market European real estate Surrounded by offers amid a decline in buying as high interest rates and high prices stifle buyers at a time when companies are struggling with debt and scrambling for cash.
According to a report by the “Bloomberg” agency, today, Wednesday, the major property-owning companies in Europe tend to sell part of their real estate holdings to reduce their debts, but have failed to obtain buyers due High interest rates And fears for the future of the market.
The report indicates that a group of large companies in Europe, including Germany’s ‘Fonvia’, Britain’s ‘Land Security Group plc’, France’s ‘Unibelle Rodamco’ real estate holding company and Britain’s ‘Westfield’ have offered plans to sell a group of its assets in order to improve its financial balance, but inflation and high interest rates hampered the sale operations.
The British company “Land Seek” had announced a £4 billion property sale plan, unveiled in 2020, while the “URW” company revealed a plan to get rid of €4 billion worth of properties, but so far it only got contracts for around 3.2 billion euros.
And German firm Fonofia unveiled plans to sell at least 13 billion euros of real estate assets it owns last August in a bid to reduce debt levels that worried investors, but it has yet to find buyers, according to sources. data announced for the third quarter of the year.
No less than 23 billion euros ($24 billion) of assets owned by the largest property owners on the European continent have been announced for sale, according to Bloomberg data, but the real amount of assets offered for sale could be much more. higher than mentioned value, as it does not include The number of companies that have not yet identified specific assets for sale.
Buyers are currently worried about taking on new financial obligations, according to an analysis by “Bloomberg,” especially as home values are on the cusp of a significant decline that can reach double-digits amid fluctuations in interest rates that make debt expensive, making it difficult to find finance for operations at a time when financial institutions are looking to grow their cash flow.
In this regard, Thierry Podemoulin, CEO of Adler Group SA, said on Tuesday that his firm failed to complete a series of planned real estate sales and therefore announced a debt restructuring deal, and added: ” The real estate investment market is witnessing a complete freeze in business.” …buyers are afraid of taking losses.”
Property owners in Europe are facing major crises represented by high borrowing costs, which have started affecting real estate asset values and increasing debt servicing, thus multiplying their financial crises.
The Adler company of Berlin has come under severe pressure during the current year, which has led to the collapse of the company’s shares and limited its refinancing options, to the point that it has had difficulty finding an auditor for it after it KPMG resigned in May from auditing its accounts.
