Real Estate Firm GTC In Talks to Sell Part of German Portfolio

(Bloomberg) — Polish real estate developer Globe Trade Center SA is in talks to sell part of the German residential portfolio it acquired less than a year ago.

GTC plans to sell about 45% of the portfolio it bought from Peach Property, a Swiss-listed real estate company, chief executive Malgorzata Czaplicka said in an interview.

“We have already started marketing among certain potential buyers,” he said.

The CEO said the firm has identified the property it wants to dispose of but does not expect to see the first sale until next year. The proceeds will be used to repay 190 million euros ($220 million) of the financing provided by Baupost Group and Diameter Capital Partners to acquire the portfolio.

At the time, the deal marked a departure from GTC’s commercial real estate space, which was generally in central and eastern Europe. Czaplicka said that depending on market developments, the company plans to focus on core markets in the future.

The developer is looking to reduce its business in the face of wider pressure on property valuations and higher financing costs.

In addition to the sale, the company also refinanced its high-yield bond due in 2026. GTC issued 455 million euros of securities due 2030 this month after announcing plans for a tender to buy back existing bonds.

According to the previous statement, Schroder Investment Management would purchase 275 to 300 million Euros of the new bond.

In the interview, CFO Jacek Bagiński said that the developer also plans to extend 300 million euros of short-term bank debt until the first quarter of next year. Discussions are already “well progressed” and the loans are likely to be extended for a period of five to seven years.

–With assistance from Marton Kasnyik, Constantine Courcoulas and Konrad Krasuski.

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