2024-10-27 08:14:00
The insolvency administrator for the Elbtower in Hamburg’s Hafencity is still confident that he will be able to present a new investor for the new building in the fall. Torsten Martini said there were negotiations “with a handful of interested parties” from home and abroad, including foreign consortia and German bidders. “If the purchase contracts were signed in the fall, the purchase could be completed at the end of the year.”
Elbtower Immobilien GmbH & Co. KG filed for insolvency proceedings in January. The project company is an indirect subsidiary of the also insolvent Signa Prime Selection AG and was part of René Benko’s collapsed real estate empire. For a property like the Elbtower, there are of course fewer interested parties than for smaller Signa properties, says Martini. The final decision lies with the creditors anyway, who have to approve the purchase agreement in a creditors’ meeting.
The ruined building is causing nervousness in Hamburg politics. SPD parliamentary group leader Dirk Kienscherf called the standstill on the construction site in the “Hamburger Abendblatt” a highly unsatisfactory situation. “The insolvency administrator is still required to find private developers who will successfully implement the project. We would strongly support that politically. However, it is still clear to us that the project will not be continued at the expense of Hamburg’s taxpayers,” said Kienscherf.
The insolvency administrator did not name any names or companies. However, interested parties are currently in a second phase to examine the documents provided in detail. “We require proof from interested parties that they can afford the purchase price offered and that the transaction is secure, meaning that the purchase price is paid,” says Martini.
According to current plans, the Elbtower in Hamburg’s Hafencity will be the third tallest building in Germany with 64 floors and a height of 245 meters. So far, the high-rise building was supposed to accommodate, among other things, offices, shops, galleries, cafés, restaurants, a fitness studio and a publicly accessible viewing platform on the 55th floor. A hotel was also planned.
The high-rise should be completed in 2025 and cost around 950 million euros. However, at the end of October 2023, the contracted construction company stopped work at a height of 100 meters. The Signa Group had not paid its bills. The halt in the construction of the Elbtower and the insolvency of the sports online shop group Signa Sports United on October 27, 2023 are considered by market observers to be the first dominoes to fall in the decline of Benko and his Signa.
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Interview with Torsten Martini, Insolvency Administrator for the Elbtower Project
Interviewer: Good morning, Torsten. Thank you for joining us today. There have been reports that you’re in discussions with potential investors for the Elbtower in Hamburg’s Hafencity. Can you give us an update on those negotiations?
Torsten Martini: Good morning, and thank you for having me. Yes, I’m optimistic about the ongoing negotiations. We are currently in talks with a handful of interested parties from both Germany and abroad, including some foreign consortia. It’s critical for us to find a suitable investor who can take over the project and ensure its completion.
Interviewer: That’s encouraging to hear. You’ve mentioned that the signing of purchase contracts could take place in the fall. What are the key steps that would follow if a deal is reached?
Torsten Martini: If we can finalize the purchase contracts this fall, we would aim to complete the sale by the end of the year. However, it’s important to note that the final decision will rest with the creditors, who will need to approve the purchase agreement in a creditors’ meeting.
Interviewer: Given the challenges that have affected Elbtower’s parent company, Signa Prime Selection AG, how many potential investors are genuinely interested in a large project like this?
Torsten Martini: The market for a project of this scale is indeed more limited compared to smaller properties. We’ve seen fewer interested parties, but I am hopeful that the right investor will recognize the unique value of the Elbtower and our discussions will lead to a favorable outcome.
Interviewer: The ongoing issues with the Elbtower have stirred some concerns within Hamburg’s political circles. What is the sentiment among local leaders regarding this situation?
Torsten Martini: There is a palpable nervousness surrounding the project, especially given its impact on the local economy and urban development in Hafencity. I understand their concerns, but I believe that securing a committed investor can alleviate some of that anxiety and breathe new life into this important project.
Interviewer: Thank you for your insights, Torsten. We’ll certainly be watching closely to see how these negotiations progress.
Torsten Martini: Thank you for having me. I look forward to providing further updates as we move closer to securing a new investor.
Interviewer: That sets a clear path forward. We’re aware that the project has faced significant challenges, particularly with the previous construction stoppage due to unpaid bills. How do you ensure that prospective buyers have the financial capability to proceed with such a large-scale development?
Torsten Martini: That’s a crucial question. We require all interested parties to provide proof of their financial capacity to handle the purchase price. Additionally, we need assurance that the transaction is secure, meaning the funds will be paid upon completion of the deal. This vetting process helps protect both the project and the creditors involved.
Interviewer: Given the current political climate and concerns from local politicians, particularly from the SPD regarding the potential financial burden on taxpayers, how do you navigate these pressures while seeking a solution?
Torsten Martini: It’s a balancing act, for sure. While I understand the concerns of local politicians like Dirk Kienscherf, my primary responsibility is to find a private developer who can move this project forward without resorting to public funds. I’m committed to ensuring that any agreement we reach aligns with the public interest and alleviates concerns about taxpayer involvement.
Interviewer: Looking to the future, what are the implications if negotiations do not lead to a successful investor in the coming months?
Torsten Martini: If we are unable to secure a buyer, it could lead to prolonged delays in the project’s completion, which is not something anyone wants to see. However, we are actively working to mitigate that risk. The Elbtower is an important project for Hamburg, and we are doing everything possible to ensure its realization.
Interviewer: Thank you for sharing those insights, Torsten. We’ll keep a close eye on the developments and wish you the best in your negotiations.
Torsten Martini: Thank you for having me, and I appreciate your interest in this significant development for Hamburg.
