The selection of the state properties to enter the securitization process begins on Tuesday as the Public Properties Company’s governing board is expected to approve the tender for the contractors to manage all pending issues related to the title deeds of some 3,000 properties.
These are real estate assets that will be passed on to state privatization fund TAIPED for inclusion in one or more securitization packages the fund will offer to the market.
Sources say that the tender will be proclaimed in the coming days and will have a budget of 7 million euros. The plan is for three contractors to undertake the project. Among their main obligations will be to put together the first batch of properties without any outstanding issues for TAIPED to utilize them from September. This first grouping of properties will include some 1,000 assets and will allow for their securitization, with the fund expecting to draw between 350 and 500 million euros.
Nevertheless the planned securitization has not yet been officially chosen as the most appropriate model for the utilization of state properties. The fund is still considering the option of creating a company that will manage all those assets and then float it for investors to acquire holdings in it.
Market experts say that the floating model could fetch significant profits in the long run, but not straight away as TAIPED desires. On the other hand, securitization would fetch more cash quickly, but be less beneficial in the long term.