Polaris World claim that settlement is imminent

Polaris World spokesman says only "minor details" prevent signature of financing deal.

2010-03-09

A spokesman from Polaris World said late on yesterday afternoon that they have all but agreed a re-financing deal with their creditors, which is "practically concluded" and awaiting signature within the next few days.

He claims that there are still a few minor points under negotiation, and that these will be concluded soon.

It would be hoped that they will be, as there are only 2 weeks remaining before the company is forced into bankruptcy.

 

Residents on the urbanizations have been expressing their grave misgivings about the financial future of the company following the silence of these last 2 months, the failure of the company to negotiate a swift settlement pointing to the unwillingness of  financial bodies to be forced into accepting a deal which leaves them with yet more stocks of properties that nobody seems willing to buy.

 

The announcement from Polaris Management  was accompanied by an optimistic little sidenote saying that house sales are on the up again, the British are back and buying and the market place is looking jolly and rosy for the future.

 

Which is in sharp contradiction to the communication we received from a Polaris agent at the weekend who has 100 properties to sell on the Condado development at 50% discount, 100% mortgage, and no interest for 3 years.

And is keen to conclude a deal within the next few days.

 

1,000 million euros worth of debt was re-negotiated last year by the offloading of properties, leaving Polaris with the lucrative management holding companies and cash to continue their operations.

Yet just a few months later they're back in debt to the tune of 100,000,000 euros, and continuing to build on the Condado development, completing just 3000 of the 30,000 homes  planned for the site, with many more millions to spend if they are to deliver the services promised to residents who purchased off-plan.

 

Whilst the government is undoubtedly keen to spread the message that the British are back and buying, it is hard to understand the optimism, when estimates of the volume of unsold properties clogging up the Spanish market vary from 900,000 to 1.2 million unsold, empty shells.

Can we trust their light of hope, or would it be better to listen to someone like BBVA who estimated 1.1 million properties were empty and unsold at the end of last year?

 

Or the government who optimistically announced at the end of last week that property sales were up 4.1% on the previous year in the last quarter of 2009, proving that things were looking positive.

 

Well they may have been in Madrid and Barcelona, where much publicized public auctions of bank properties at massive discounts have allowed a spot of re-shuffling of balance sheets by banks caught with an estimated 32 billion euros worth of re-possessed property assets they're desperate to offload.

But the true story is in Murcia, where sales dropped 6% on the previous quarter, a real drop of 20% from the same time the previous year.

 

And these Polaris properties are right bang slap in the middle of Murcia.

If somebody owed you 100 million, would you settle for properties you didn't want or would you hold out for the management companies until 2 weeks before the end of a 3 month negotiation period.

With just a few minor negotiations to conclude, it's interesting to speculate which ‘minor points" could still be on the negotiating table.

 

On the other hand, they could just be waiting for the American surveyors to announce that the magic well of Paramount Pictures has struck liquid gold and wants to build it's new theme park on the lovely big piece of flat land conveniently close to the Condado of Alhama, next to the new airport and the new high speed rail link, and the new triangle of motorways circling the development.

Do you believe that white elephants can fly........

 They can if Paramount Magic comes to town.

Click Polaris financial problems to trace the story back

Back to News