Spanish real estate firm Tremon has filed for administration after failing to meet debt repayments. The privately held firm has accumulated close to EUR 1 bn in syndicated debt.
Spanish real estate firm Tremon has filed for administration after failing to meet debt repayments. The privately held firm has accumulated close to EUR 1 bn in syndicated debt.
Tremon is the second large Spanish property developer to seek administration this year. In July Martinsa-Fadesa filed for administration in one of the biggest corporate failures in the country's history.
Tremon's creditor banks include Banco Popular, Bancaja and Banco Pastor, which provided debt facilities of EUR 200, EUR 100 and EUR 95 mln respectively, according to reports in Spanish media.
Other banks involved are Banco Sabadell, BBVA, as well as other 12 Spanish Cajas (Caixa Galicia, La Caixa, Caixa Catalunya, Caja Castilla-La Mancha, CAM, CajaSur, Cajamar, Caja Madrid, Caja Cantabria, Caja España and Caja Sol).
The failure puts more pressure on the Spanish savings banks who are already struggling to survive in the global financial crisis. This is the first significant economic slowdown experienced in the country since its transition to democracy in 1978. The Spanish government recently announced a plan to help up to 500,000 people in the country with delayed mortgage payments.
Earlier this month, Banco Sabadell, one of Tremon creditor banks, reportedly put half of its 1,250 office-property portfolio across Spain on the market to raise equity. The bank is looking to realise capital gains of EUR 600 mln from the disposal and hopes to broker a deal on 600 properties next year. BBVA and Banco Popular adopted similar measures in recent years.
