New ‘rule’ in the real estate market in Germany: Deprecated “green” business building – mammoth

New “rule” in the real estate market in “scapped” in , as it went bankrupt “green” business property – mammoth, which belongs to the “imperial” of Thomas Olek (Tomas Olek). Specifically, PREOS Global Office Real Estate & Technology AG announced today (05.03.24) that GSP Century GmbH filed an insolvency application at Leipzig Local Court (Germany). GSP Century GmbH is a real estate company whose only asset is Frankfurt Office property “The Century”. Lawyer Dr Rainer M. Bähr was appointed interim insolvency administrator. There are no reciprocal requirements, requirements or enforcement obligations between GSP Century and PREOS. Consequently, PREOS will lose only one monthly amount previously incurred under a current service agreement. The parent company of PREOS publicy AG is also affected only by the current situation due to the cancellation of a current asset management order. There are no further implications for PREOS and its parent company, according to the company’s announcement. PREOS is sure that the temporary insolvency administrator will be able to find an investor for the property within the next three months. There are already several new tenant candidates for the property. In addition, “The Century” still fulfils all the conditions for its conversion into a green building and the corresponding plans have already been prepared. According to Handelsblatt, with a low-emission cooling system, a green facade and busy bee colonies, the Century Tower tower in Frankfurt, is to become the green showy work of Preos office investor. The plant panels will soon absorb 2.3 kg of carbon dioxide and release 1.7 kg of oxygen per year and square meter, calculated CEO Stefan Noetzel. That was two years ago. In the meantime, it has been made clear that there is another thing about fresh air and other “clean” capital. Noetzel will no longer implement green plans for the 75-metre-high building. On 1 March, the Leipzig local court appointed Rainer Bähr from the HWW restructuring expert firm as a temporary insolvency administrator for GSP Century GmbH. It is a subsidiary of Preos, to which the property belongs. Bähr is to secure future insolvency assets. According to the Handelsblatt newspaper, the company has filed the procedure itself. The interim insolvency administrator confirmed that the property is part of the bankruptcy property. He is in “good contact” with the financing bank, Bähr announced. First priority is to continue the management of the building without tenants facing problems. The tenants of the 16-story office building include American communications company Avaya and state bank KfW. The lease for the American Express credit card provider is due to expire at the end of 2024. Preos Noetzel’s board member also planned to attract electronic car manufacturers and companies from the health food sector to the building. The bankruptcy of Centrion Tower once again highlights Preos’ precarious financial situation, a company specialising in the Frankfurt-based real estate market. The full name of the anonymous company is Preos Global Office Real Estate & Technology. It belongs to the empire of Thomas Ole k, a real estate investor who is both active and controversial. Olek is the central person in a chain of successively organized equity companies. The businessman is at the top because he controls the majority of Neon Equity AG. This company owns more than half of the shares in Publishing AG, where Olek is chairman of the supervisory board. Publicy AG, in turn, holds almost 95 % of Preos’ shares. At present, it is unclear what consequences the insolvency of Centrion Tower will have for the waterfall of anonymous companies. On Tuesday it was reported: “Preos Publishing AG parent company is also affected only by the current situation due to the cancellation of a current asset management order”. This sounds comparatively harmless, but the situation in important companies has been tense for some time. Preos announced losses of over 214m euros in 2022. Its share, which was worth 15 euros at its peak, has been negotiating for several months in the minute area. Publity AG published today (05.03.24) its annual financial statements for 2023. The significant loss of EUR 237 million is partly due to the fact that the administration underestimated Preos’s securities of EUR 151 million. In December, creditors promoted the restructuring of Preos’ convertible bond of EUR 250 million. The circumstances are confusing because a large part of the bonds were in the Olek empire before the vote. A group of creditors is legally against restructuring because it considers that it has been wronged. The agreed cuts may not be sufficient to save, Preos Noetzel’s board member warned in a “risk warning” in December. A future bankruptcy cannot be ruled out. Noetzel wanted to sell four properties belonging to a Preos subsidiary and thus liquidate 300 million euros. If this plan fails, it could lead to “the company’s insolvency” despite restructuring, he wrote. Today (05.03.24), Noetzel stated: “The possible failure of the sale of Centrion, which is scheduled to take place by the end of 2024, has no strategic impact on Preos’ financial situation.” No positive input from the sale of the Centrion Tower was foreseen in the first place for Preos. GSP Century’s annual financial statements for 2021 have been published in the Government Gazette. It gives an idea of where the problem might have been. The fixed assets of EUR 56 million are offset by liabilities of EUR 61.5 million. “There is an over-charge to the balance sheet of EUR 822.547,34”, wrote Frank Schneider. At the time, the CEO of Publity was also CEO of GSP Century. Despite the overburden, Schneider was optimistic. The company could continue to operate because there were “secret reserves” in the building and “the conclusion of long-term rental agreements can still be expected”.