Spanish property firm quadruples asset sale

August 19, 2008
Spanish property firm quadruples asset sale

(MADRID) Spanish property firm Metrovacesa is quadrupling its sale of
assets, company documents show, as it struggles to refinance assets
bought at the top of Britain's property boom and faces a property
crisis at home.

Details of the firm's revised business plan, named Phoenix, show that
the company is to quadruple the sale of assets to two billion euros
(S$4.15 billion).

It will now sell 1.53 billion euros worth of commercial assets such
as shopping centres or offices in addition to the 486 million euros
worth of land it announced in the first draft of Phoenix in February,
after struggling to sell land in Spain's near-paralysed market.

'When we first presented Plan Phoenix, conditions were not as bad as
they are now. Because it is difficult to sell land at the moment, we
will increase in property,' a spokeswoman for the company said.

Metrovacesa borrowed £810 million (S$2.13 billion) from HSBC to buy
the bank's skyscraper headquarters in London before leasing it back
to the bank and only has until Nov 27 to pay it back.

The company is locked in refinancing negotiations with HSBC, talks
that the spokeswoman said were making progress.

'We have always been confident of refinancing it. We are going to
study what is the best option,' she said.

Metrovacesa also owes £240 million used to buy the Walbrook Square
office site in the City, which is due on Oct 31.