Real estate assets 'will cause problems for Spanish banks'

Spain's small and medium-sized banks are most at risk from their exposure to the country's real estate market, it has been claimed.

In an interview with Bloomberg, managing partner of Madrid-based MaC Group Pablo Cantos expressed his concern for such establishments "whose business is 100 per cent in Spain and based on real estate growth".

The news provider noted that it is estimated banks in the nation hold approximately 30 billion euros (£25.6 billion) worth of Spanish property that is classed as "unsellable", according to six lenders.

Meanwhile, Fernando Rodriguez de Acuna Martinez, a consultant for R R de Acuna and Asociados, told the publication that a large proportion of real estate assets and land are now effectively worthless because of their location.

He pointed out that 43 per cent of the country's unsold homes are situated in areas a long way from city centres, while a further 36 per cent of the stock is in coastal regions.

It has recently been reported that Morgan Stanley Real Estate (MSRE) is now the preferred bidder for three billion euros of real estate assets brought to market by Santander. MSRE offered 1.2 billion euros for the portfolio in the initial bidding stages, Property Magazine International revealed.
 

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