The plight of Inmobiliaria Colonial has raised fears of asset fire sales by indebted Spanish property companies, which could further hit already shaky property prices.
Colonial, whose stock lost nearly three-quarters of its value in a week after banks holding shares as collateral in derivative positions dumped stock on the market, has sold over 300 million euros ($441.6 million) worth of assets in the last week.
While it said these sales were part of normal activities, some analysts pointed to the three-way squeeze closing in on indebted Spanish real estate firms facing tightening credit, cooling property prices and rising interest rates.
“If everyone does this in one go, you may see an excess of product on the market, and prices may go down further,” Borja Sierra, former head of Spain for British property broker Savills , now based in New York for Savills Granite.

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