DJ Business Update
BCRE Brack Capital Real Estate N.V.
Business Update
22-Dec-2020 / 17:00 CET/CEST
Dissemination of a French Regulatory News, transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.
This announcement contains inside information within the meaning of the
Market Abuse Regulation (EU) (No 596/2014).
22 December 2020
BCRE - Brack Capital Real Estate Investments N.V.
("BCRE" or the "Company")
Business update
Further to the Company's announcements, dated 21 May 2020, and 11 September
2020 as well as the Company's Annual Report, the Company would like to share
its view and information on the ongoing COVID-19 crisis effect on its major
residential project in Manhattan - 720 West End Av (the Project).
Following a period of an already weak Manhattan residential market, the
outbreak of Covid 19 instigated major negative developments: a regulatory
freeze of construction works in the city; a virtual freeze in residential
sales; and an extreme tightening of credit availability. These negative
developments forced the Company to alter course from the Project's original
business plan.
During the first months of the pandemic the Company examined extensively
various alternatives and structures for the development financing of the
Project. Dozens of potential lenders were approached, and many undertook
relatively detailed diligence processes. This process did not produce a
viable financing offer, mainly due to the high uncertainty level, general
market environment and scarcity of financing appetite as well as relative
complexity of the Project.
Consequently, the Company's board and management quickly adopted an
alternative approach, suitable to the current risk-averse environment - an
approach involving a significantly lower leverage accompanied by a high
proportion of presale at attractive price levels. The strategic thinking
behind the Company's new approach was to construct the Project in
anticipation of a potential market pick - up towards the end of the
construction period (2-3 years), while offering to investors a low risk hard
asset, attractively priced and inflation resilient, which is scarce in the
economic backdrop of low interest rates and inflation concerns due to rising
money supply and budget deficits.
The Company is currently reviewing alternatives based on the above
structure. If a viable development scheme is not formulated by the end of
January, the Company will face one of two main alternatives (or a
combination thereof): extend the current loans per existing contractual
options (by up to six months) or put the Project for sale, despite the
suboptimal circumstances (still hesitant buyer pool even with the positive
vaccine news and high uncertainty regarding economic environment and the
city tax regime).
ENQUIRIES:
BCRE - Brack Capital Real Estate Investments
N.V.
Nansia Koutsou, Chief Executive Officer
Yiannis Peslikas, Chief Financial Officer +31 20 514 1004
Novella Communications
Tim Robertson +44 203 151 7008
About BCRE
BCRE is an international real estate development and investment group,
headquartered in the Netherlands and listed on the Cyprus Stock Exchange.
Through its subsidiary and associated undertakings, the Company is
interested in, develops and operates and international portfolio of real
estate assets in the markets it operates.
The Company has established local management team platforms with significant
local market expertise. At present, the Company has offices and teams in New
York, Moscow, Amsterdam and Limassol.
Regulatory filing PDF file
File: Business Update [1]
Language: English
Company: BCRE Brack Capital Real Estate N.V.
Barbara Strozzilaan 201
1083HN Amsterdam
Netherlands
Internet: http://www.brack-capital.com/
ISIN: NL0010763611
Euronext MLBCR
Ticker:
AMF Category: Inside information / Issuer activities (acquisitions,
sales...)
EQS News ID: 1157028
End of Announcement EQS News Service
1157028 22-Dec-2020 CET/CEST
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(END) Dow Jones Newswires
December 22, 2020 11:00 ET (16:00 GMT)
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