smithpaul's  Instablog

Portuguese lenders are offering thousands of repossessed homes at reduced prices after investment in real estate fell to the lowest in a decade. Banco Comercial Portugues SA (BCP) is offering discounts of as much as 12 percent.

Portuguese banks are expected to sell about 10,000 houses and apartments this year, or 22 percent of total sales, compared with about 6,000 homes last year, said Manuel Alvarez, regional director of broker Re/Max Portugal.

"Banks need to get rid of their real estate assets and to do this, they need to create demand," said Walter Fabrega, broker Jones Lang LaSalle Inc.'s (JLL) head of capital markets in Portugal. "Demand has to be created through big discounts."

The thousands of soured assets being sold highlight the difficulties indebted homeowners have faced since Portugal sought a 78 billion-euro ($100 billion) bailout from the European Union and the International Monetary Fund in 2011. The latest discounts are expected to attract new investors, helping the market to recover, brokers said.

"After a long waiting period, we have finally started to clearly identify demand for value-added and distressed assets from funds with opportunistic money," Jones Lang said in a report last month. "This tendency will continue and will increase during 2013."

Investment in Portuguese real estate declined 38 percent in 2012 from the previous year to 125 million euros, the lowest in the last decade, according to Jones Lang. Prices declined for a second straight year in 2012, losing 2.2 percent, according to Confidencial Imobiliario, which collects data on the Portuguese property market.

'Necessary Move'

Portuguese real estate had its worst performance in decades in 2012 after investment in commercial property dropped by 50 percent from the previous year, Eric van Leuven, managing partner at Cushman & Wakefield Inc. said in January.

"This move by the banks is necessary for the real estate market in Portugal to recover," Re/Max's Alvarez said. "Without the discount, many people wouldn't be able to buy."

Banco Comercial, Portugal's second-largest publicly traded lender, is selling more than 700 repossessed homes, offices and warehouses with discounts of as much as 12 percent below their market value to individuals who complete the purchase by the end of May. It and state-run Caixa Geral de Depositos carry out monthly real estate auctions across the country.

"By offering properties at competitive prices, Banco Comercial has helped keep the real estate market in Portugal liquid and resilient," Miguel Maya, an executive board member at Banco Comercial Portugues, said in an e-mail.

Officials at Banco Comercial, Caixa Geral and Banco Espirito Santo SA (BES), Portugal's biggest publicly traded bank, declined to say how many real estate assets they each plan to sell this year. For more information.

Source: http://www.1realestateinvesting.com/portuguese-banks-slash-repossessed-home-prices-to-revive-market/

Blackstone Group LP (BX)'s real estate unit may gain control of Multi Corp. after acquiring almost half of the European shopping-mall developer's 900 million euros ($1.2 billion) of corporate debt in the past nine months, said two people with knowledge of the situation.

Multi, based in Gouda, the Netherlands, told lenders in March it wouldn't pay interest on loans it obtained to acquire land as commercial-property values were peaking, said one of the people, who asked not to be named because the talks are private. The prospect that the debt won't be paid means lenders are more likely to write down or sell their holdings, the person said.

Gaining control of Multi would give Blackstone a pan- European retail business, according to one of the people. The Dutch company operates in 14 European countries and Turkey, according to its website. Were Blackstone to gain control, the private-equity firm probably would recapitalize the mall developer, the person said.

Peter Rose, a spokesman for New York-based Blackstone, declined to comment on a possible deal. Multi didn't immediately respond outside regular European business hours to an e-mail requesting comment about its debt.

Multi's approximately 900 million euros of debt matures in March 2015, said a person familiar with the terms. Blackstone's European property unit paid about 50 cents per $1 of face value for the debt it acquired, the person said. Multi's other lenders include banks in Portugal, Germany, Spain and the Netherlands, according to the person.

Blackstone's purchase of Multi debt was first reported yesterday by the Financial Times.

Source: http://www.1realestateinvesting.com/blackstone-said-to-be-poised-to-gain-multi-corp-control/

U.K. financial firms may add 4,000 jobs in the first half of the year, ending three consecutive quarters of cuts, as companies anticipate increased sales, the Confederation of British Industry said.

Banks, insurers, asset managers and other firms probably hired 2,000 people in the first three months of 2013 and may add 2,000 in the second quarter, Britain's biggest business lobby group and accounting firm PricewaterhouseCoopers LLP, said in a study published today.

The projected gain compares with the CBI's prediction in January for 18,000 job reductions in the first quarter, in the industry that employs about 1 million people in the U.K. The reversal comes as some financial firms hire compliance workers to prevent further scandals such as loan insurance mis-selling and sanctions violations amid increased regulation and scrutiny. HSBC Holdings Plc (HSBA), Britain's largest bank by market value, said last month it would spend an extra $500 million a year on compliance and legal staff.

"Firms are beginning to sense the prospect of some pickup of business activity and want to make sure they're ready to take advantage of that," Matthew Fell, CBI director of competitive markets told reporters in London. "The picture is becoming a little clearer on what is to be done on the regulatory front, and that's perhaps why we're seeing some stabilization, some flattening out."

Trading Gains

The CBI's survey found 32 percent more respondents said trading increased in the three months through March and 27 percent forecast higher sales in the current quarter.

The London-based CBI and PwC surveyed 96 banks, insurers, customer-owned lenders, investment managers and securities firms from Feb. 20 to March 7.

The U.K. economy will avoid another recession and exports will help propel a "modest" recovery this year, according to the British Chambers of Commerce. The BCC's measures of domestic and foreign demand at manufacturers and services companies all rose last quarter, the London-based group said in a report today….

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