Brussels poised to decide on property sell-off

The Belgium government is to decide today on the winning bid for the controversial sale of 62 state properties. The transaction, expected to raise EUR 500 mln, has to be finalised by the end of the year to help balance the budget. Belgian newspaper De Tijd reported on Thursday that the KBC Group was considering fielding a rival bid to entered by real estate groups Cofinimmo and Befimmo.

Opposition parties rounded on Belgium's finance minister Didier Reynders earlier this month when he presented the proposal for the sale. 'You must stop immediately with the sale of our property assets,' Servais Verherstraeten of the Christian Democrat CD&V demanded in parliament. He said the Belgian audit agency had sharply criticised previous sales of government buildings for being over-hasty and not raising enough money. 'It is clear that it is difficult to negotiate [a good price] when you have a knife at your throat,' Verherstraeten said.

Reynders was forced to adopt this approach after the Council of State shot down the original scheme to set up a new closed-ended real estate investment company (Sicafi), in a joint venture with property company Cofinimmo, to manage the properties. The scheme was suspended after two other real estate companies. Axa Belgium and Befimmo, mounted legal action to contest the decision to appoint Cofinimmo.

The Belgian government has had great difficult over the budget and it has been reported that government departments have been instructed to delay paying suppliers until the next book year.