Elbtower and KaDeWe
Trustee takes over sale of Signa “fillet pieces”
March 18, 2024, 5:43 p.m
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Creditors are demanding almost 13 billion euros from the insolvent Signa Group. Almost six have been recognized so far. A trustee should now get as much money out of them as possible and sell the most high-profile properties in the coming years.
The most prestigious properties of the largely insolvent Signa Group will be sold by a trustee in the next few years. The creditors of Signa Prime Selection AG approved this plan in Vienna, as the insolvency administrator of this important subsidiary announced. “In the vote, both the head and the capital majority were achieved and the trust restructuring plan was therefore accepted by the creditors,” the statement says. The previous self-administered restructuring, which was massively criticized by some creditors, has now come to an end.
The Signa Prime is one of the jewels of the Signa Group of the Austrian investor René Benko, which has slipped into crisis as a result of increased interest rates, construction costs and energy prices. The Prime portfolio includes, among others, the still unfinished Elbtower in Hamburg, the Berlin luxury department store KaDeWe, properties of the Galeria Karstadt Kaufhof department store chain and the building of the Austrian Constitutional Court. It is the biggest victim of the real estate crisis in Europe so far.
According to the latest data from insolvency administrator Norbert Abel, Signa Prime’s creditors have registered claims of around 12.8 billion euros. The administrator has so far only recognized around 5.9 billion euros of this. According to his proposal, all properties should now be sold by him as trustee in an orderly manner over a period of three to five years in order to benefit from an expected recovery in the market. This should cover at least 30 percent of the claims. In the event of bankruptcy, however, the properties would have had to be sold as quickly as possible, which, according to the restructuring administrator, would mean a lower quota for the creditors.
For tax reasons, Signa Prime’s German real estate is not formally subordinated to the trustee, but de facto he retains control over approval rights and over Signa Prime’s outstanding claims on its subsidiaries. The creditors’ meeting in Vienna was only about the winding up of Signa real estate, not about the sale of department store businesses such as KaDeWe and Galeria Karstadt Kaufhof. However, these retailers, which also belong to the Signa Group, are also insolvent and are looking for buyers.