Cookies on the this website
We use cookies to ensure that we give you the best experience on our website. If you continue without changing your settings, we'll assume that you are happy to receive all cookies on this website. However, if you would like to, you can change your cookie settings at any time.
Continue

New to PropertyWire?

Welcome, and thank you for visiting our website.

PropertyWire is the leading publication for property investors and industry professionals interested in the world of international property investment.

Our aim is to give you intelligent commentary and analysis on the world of retail and commercial real estate.
If you've enjoyed what you've read so far why not sign up for our FREE property alert and online magazine PropertyWire Confidential.

Every week the PropertyWire team sends out a hard-hitting newsletter packed with news and analysis of the top stories plus the best investment opportunities on the market. We always look at the bigger picture like the Euro Crisis, and explain how this will affect YOUR investments.


Ask me later
No thanks

Sat
Aug 23rd
Lost Password? Register
Home arrow News arrow Europe arrow Scottish property market expects fallout from HBOS takeover

Scottish property market expects fallout from HBOS takeover

Sunday, 05 October 2008
Scottish property market sees distressed sales
Scottish property market sees distressed sales

The takeover of HBOS by Lloyds TSB could lead to distressed properties coming onto the property market in Scotland and hit builders who are funded by the bank.

According to one property analyst HBOS has given both debt and equity support to commercial property firms and clients and was generally reluctant to take action against borrowers who breached their banking covenants with lenders.

But David Davidson, a partner at Cushman & Wakefield, warns that the new owners may not be so amenable. 'HBOS has equity stakes in high-profile companies, such as Miller and Cala. There are almost no property companies without exposure to the bank. The new owner may be more objective and want to sell those assets,' he said.

This could lead to more distressed stock coming onto the market. But this is seen by others as an opportunity, especially for those willing to buy at knockdown prices and might even help to stimulate the market.

Douglas Hunter, partner at law firm Dundas & Wilson, said one of the biggest sources of investment bargains will be forced sales by borrowers who have breached their banking covenants with lenders and this will create a pool of distressed commercial properties.

He expects most banks will take action against borrowers with broken covenants if the credit crunch continues. 'At the moment, banks think that distressing the properties may result in them losing more money than if they hold on to them. They may not be able to maintain that view if the current turmoil in banking markets continues,' he explained.

Another potential source of distressed properties is retail property investment funds. They experienced large outflows of money last year, leading to a number of firms, including Scottish Widows and Aegon, introducing redemption periods for clients wanting to withdraw their money.

The outflow has now stopped, but Hunter says if consumer sentiment changes again, funds may be forced to sell properties at a cut price to inject liquidity into funds. Potential investors looking for bargains include institutional investors, sovereign wealth funds, property companies with existing finance or lines of credit, wealthy individuals and recovery or vulture funds.


BOOKMARK THIS PAGE (What is this?)     Digg!Reddit!Del.icio.us!Google!Live!Facebook!StumbleUpon!Newsvine!Furl!Yahoo!

 
Related News
More Recent News
Earlier News
To see all the latest news articles in our monthly online magazine, Property Wire Confidential, sign up free here



Europe: Top Headline

Warning to UK home owners about attempting DIY this bank holiday weekendWarning to UK home owners about attempting DIY this bank holiday weekendWith the bank holiday weekend underway it has been revealed that more home owners in the UK are attempting DIY without professional help and two million have damaged their property as a result.



West Tower

West Tower

Car park

West Tower

home rental guide

Limousin Guide

Barratt Homes

Limousin Guide

West Tower

Search for Properties:

Feature story

Student accommodation investment check List

It’s the UK’s strongest asset class, but are all student accommodation properties good investments? This is the comprehensive list of what to watch out for when buying student property.

 

Company news

Pre-nuptial Agreements Increasing In the UK

http://www.buffalogov.org/files/Images/wedding.JPGA pre-nup is often a subject of much mirth in the UK; a dinner party debate about the merits of pragmatism versus idealism. Considering what you might do in the event of a divorce with regards to your estate is of course very pragmatic, but the partner calling for the agreement has often been depicted as a tad mercenary.

Finance Update

Barclays trims mortgage rates to attract more first time buyers

Barclays has launched new and reduced mortgage rates which it says will support first time buyers and those customers with a smaller deposit.

Features

Student accommodation investment check List

It’s the UK’s strongest asset class, but are all student accommodation properties good investments? This is the comprehensive list of what to watch out for when buying student property.

 

Newsletter

Subscribe to our weekly newsletter and stay updated on the property market trends.
Subscribe now >>

Subscribe to our Europe property and real estate news feed (RSS)