Troubled Spanish property company Reyal Urbis has frozen the development of its flagship project in Madrid, Castellana 200, amid difficulties in refinancing EUR 4.8 bn of debt, Spanish newspapers have reported.
Troubled Spanish property company Reyal Urbis has frozen the development of its flagship project in Madrid, Castellana 200, amid difficulties in refinancing EUR 4.8 bn of debt, Spanish newspapers have reported.
The complex, which consisted of a luxury hotel, office and retail space, was initially due for completion in late 2009, but the Madrid-based developer failed to find the EUR 350 mln in funds needed to complete the project. The company has hired Lazard to advise it on the refinancing process.
Reyal announced plans to develop the mixed-use project at the end of 2006. In the same year the Spanish company launched its takeover offer for rival Urbis. The acquisition, valued at EUR 3.3 bn, was financed through a loan of EUR 3 bn that the company is now struggling to restructure.
To help refinance its mountain of debt the company has reportedly put some of its trophy assets on the market, including the ABC shopping centre in Madrid's famous Serrano street, which previously housed the headquarters of newspaper ABC, as well as the Marcelo Spinola de Madrid office building leased to Vodafone and Packard Bell.
