This article is from the Australian Property Journal archive
THE Rubicon America and Europe Trusts have seen the value of their portfolio continue to decrease and RAT expects to book a net loss of $320 million.
REU’s real estate portfolio has been revalued at €478.5 million, representing a reduction of approximately €76.2 million (or 13.7%) relative to the carrying value as at June 30 2008.
The trust purchased the properties for €586.3 million and was originally valued at €607.9 million.
REU said it is currently in discussions with the noteholders to restructure the loans but warned that there can be no assurance that a successful outcome with REU’s lenders will be achieved.
The mood was mirrored at RAT, which has seen the value of its portfolio fall by $US76.6 million (or 10.7%) to $US641.9 million. After taking into account the equity accounting of RAT’s interests in the IPO Portfolio, Maitland and Fiddlers Green properties, RAT’s December 31 2008 balance sheet will show a valuation of approximately $US608.5 million, representing a reduction of approximately $US71.4 million (or 10.5%) compared to June 30 2008.
RAT bought the properties for $US693.2 million when they were originally valued at $US726.1 million.
RAT said the finalisation of the CRE loan impairment provision and the impact of realised losses on the sale of real estate assets and CRE loans are likely to have a significantly negative impact on the financial position.
The impact is expected to be a net loss for the 12 month period ending December 31 2008 in excess of $320 million.
Australian Property Journal
