Bloomberg News

Reyal Urbis to Start Debt Renegotiation Talks With Banks

June 27, 2011

(Adds previous refinancing in third paragraph, share price in last.)

June 27 (Bloomberg) -- Reyal Urbis SA, Spain’s fourth- biggest property company by market value, plans to renegotiate its debt for the second time in just over a year as the country’s real-estate market deteriorates.

“With the aim of guaranteeing the stability of the company’s business in the medium term, Reyal Urbis has decided to start a new process with lenders to adapt its business plan and debt to market circumstances,” the Madrid-based company said today in regulatory filing.

Spanish real estate companies relied on debt to buy rivals during a decade-long property boom and then struggled to meet sales targets when the market collapsed. In May 2010, Reyal Urbis refinanced 4.6 billion euros ($6.5 billion) of loans and extended the maturity of its syndicated loan to December 2016.

Metrovacesa SA, the largest Spanish property developer by market value, is currently in talks to restructure 5.2 billion euros of debt. Last month, Spain’s Renta Corporacion Real Estate SA agreed to a new debt deal with creditors.

Reyal Urbis rose 5 cents, or 5.6 percent to 94 cents as of 2:50 p.m. in Madrid trading, giving the company a market value of 276 million euros.

--Editors: Ross Larsen, Andrew Blackman.

Top Stories:TOP <GO> On the Spanish Property Market@ TNI SPAIN HOUSING <GO> Top Real Estate News: TOP REL <GO>

To contact the reporter on this story: Sharon Smyth in Madrid at ssmyth2@bloomberg.net

To contact the editor responsible for this story: Andrew Blackman at ablackman@bloomberg.net


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