Austria

Alternative investment managers including Arini, Eicos and Squarepoint have tens of millions of euros at risk with their investments in a unit of the insolvent real estate conglomerate Signa, Bloomberg News reported. Arini, a hedge fund founded by former Credit Suisse trader Hamza Lemssouguer, holds about half of the €300 million ($326 million) of bonds issued by Signa Development, making it one of the biggest creditors of the company, according to a company filing circulated on Monday and seen by Bloomberg News.

René Benko was a high school dropout and convicted criminal. But by 2018, he was at the pinnacle of global real estate. His company, Signa Holding, launched a glassy, J-shaped skyscraper on the banks of the River Elbe in Hamburg, Germany. The design of the 800-foot tower resembled a chart showing exponential growth, the Wall Street Journal reported. Hamburg’s mayor, the future German Chancellor Olaf Scholz, lauded Signa’s good reputation with banks when the city picked the developer to build the tower. “Signa is financially strong,” he said. It wasn’t.

The collapse of the Signa retail and real estate group is so dire that even companies hired to liquidate an insolvent unit will have to stand in line to recoup their money, Bloomberg News reported. The bankruptcy administrator for Signa Real Estate Management GmbH said assets were insufficient to pay for the clean-up, triggering a special clause under Austrian insolvency law, according to a notice to the Vienna Commercial Court.

The troubled European Signa holding company is facing claims totalling 8.613 billion euros ($9.32 billion), its court-appointed manager said on Monday, a figure that is 70% more than debts originally flagged last year when it filed for insolvency, Reuters reported. The insolvency manager, Christof Stapf, said that it had recognized only a fraction of the claims so far - just 80.3 million euros - and that many of the claims arrived without necessary supporting materials or late. Signa is the biggest casualty so far of Europe's property crisis.

The company behind Signa’s flagship high-rise development in Hamburg filed for insolvency, further challenging efforts to restructure René Benko’s property empire, Bloomberg News reported. The company developing the 245 meter (800 feet) Elbtower notified the city of its request for creditor protection Friday, according to a statement from the municipality’s authority for urban development and housing.

Germany’s Galeria Karstadt Kaufhof department store chain is attracting interest from buyers looking to lap up assets hit by the insolvency of Rene Benko’s Signa empire, Bloomberg News reported. “There are more than two interested parties,” insolvency administrator Stefan Denkhaus said in emailed comments to Bloomberg, declining to give further details. A creditor committee is discussing the sale process and will swiftly proceed with negotiations, he said.

Beleaguered bondholders of Signa Development Selection AG are looking to prevent a law enacted 150 years ago by the authorities of the Austro-Hungarian Empire from limiting their ability to pursue claims against the insolvent firm, Bloomberg News reported. Lawyers for the property unit of the Signa group recommended that a court-appointed kurator represent collectively the holders of the €300 million ($329 million) defaulted notes during the self-administration process, according to insolvency filings seen by Bloomberg News.

A 16th-century building in Munich, a luxury Berlin office development and the headquarters of department store Galeria Karstadt Kaufhof are among assets held by Signa property companies forced into insolvency in the last week, Bloomberg News reported. Torsten Martini, an insolvency administrator at law firm Görg, is in talks with creditor banks of a Berlin site at Schönhauser Allee 9 to see if construction may be able to resume, according to a spokesperson.

At its height, the empire of luxury retail and real estate tycoon Rene Benko appeared to have no limits. It extended from Europe to the US, boasting a trophy case that included stakes in some of the world’s most recognizable properties, including the Chrysler Building in New York and the UK department store Selfridges, Bloomberg News reported.

Another real estate company belonging to Austrian investor René Benko's ailing Signa Group has filed for insolvency. According to the Vienna Commercial Court, a corresponding application was submitted today by Signa Development Selection AG, IndoNewYork.com reported. The company, which specializes in project developments, is therefore aiming for self-administration restructuring proceedings, as announced by Signa on Thursday. The company should be continued and creditors should be offered a quota of 30 percent payable within two years, it said.