Sponda and Blackstone leave the Russian real estate market
The collapse of the oil price significantly hit the Russian economy. And although the consequences of the raw material price rise and the ruble depreciation are not yet so tangible, many investors are already thinking about further actions. One of the first to respond was the large American fund Blackstone. It decided to sell all assets located in Russia. The fund operated in the country’s market through its subsidiary Sponda, which is registered in Finland.
The investor intends to get rid of the objects in Russia with one lot. The main asset of Sponda is the business center Ducat Place II, which was already put up for sale about two years ago, but the deal did not take place, as those wishing to buy real estate did not meet the value of the asset. In addition to the object, the company’s portfolio includes an office complex Meliora Place, warehouses in the Moscow region and Leningrad region.
One of the prospective buyers is the private equity fund, the domestic Accent Capital fund and PPF Real Estate Russia, a Czech company. However, so far none of the claimants have officially declared their interest in the assets.
It should be noted that this is not the first time Sponda wants to get rid of objects on the Russian market. Back in 2016 it planned to sell Ducat Place II, and despite the fact that there were quite a lot of those who wanted to buy real estate, the parties could not agree on the price, and the deal did not take place.
This office complex has been owned by Sponda since 2008, when it was bought for 185 million dollars. In 2016, the company asked for 100 million dollars for the object, but buyers insisted on 60 million dollars.
4 years ago it was decided to put up for sale the office complex a few months after the Blackstone investment fund said about the acquisition of 100% of the Finnish company Sponda. However, now the owners have announced the sale of one lot of all assets, which are in Russia.
A number of market experts believe that the success of such a step by the investor will depend on the declared value and the willingness of Sponda to reduce it. The intention to get rid of this property is primarily dictated by the analysis of the local market. Unfortunately, Blackstone does not consider Russia to be a favorable environment for development and high income generation.
With the beginning of the 2014 crisis in Russia, many U.S. companies spoke about the increasing market risk and switched their attention to South American countries. Since then, however, Russian real estate has recovered and there is a high activity. Therefore, the chances that Sponda will be able to sell the objects this time are extremely high.