One of the Czech Republic’s biggest property developers, ECM Real Estate Investments, announced on April 11 that Česká spořitelna (CS) bank had submitted an insolvency proposal and a propsal for reorganization. ČS is one of ECM’s largest bondholders and has past-due claims of Kč 7.5 million. Further past-due claims of Kč 16.3 million are held by Uniqa, Volksbank, AM Slovenská spořitelna, Conseq IM and Glancus Investments.
Recently, ECM entered negotiations with the CPI Group for the sale of its City Deco and City Element office projects at a reported Kc 300 million each, but with ECM’s perilous financial state putting it so close to bankruptcy, CPI withdrew. Under insolvency proceedings, new management can be brought in to try and sort out the debt-burdened developer.