Things have been falling apart behind Signa’s facade for months. To prepare the balance sheet, properties have to be revalued every year and due to the change in the economic situation, it was recently demonstrated that in the largest real estate agency in Signa, properties are worth one billion euros less, which leads to a high loss.
Expensive facade at Lamarr department store
“The entire real estate sector is currently under pressure,” said Christian Kreuzer, an accounting expert at the Controller Institute. “On the one hand, this is due to rising interest rates. Because many of these projects are heavily leveraged by debt and inflation has caused construction costs to rise.”
Construction projects in Germany, where funding is insufficient, have now been halted. Signa claims that construction sites in Austria have not been affected. Work is underway at the Lamarr department store on Mariahilferstrasse, although there were only a few artisans on site on Tuesday afternoon. According to the plan, the next step would be the expensive facade, including glass surfaces and interior work.
ORF/Christian Öser The Lamarr department store is currently Signa’s best-known construction project
Signa needs new capital
There must be enough money for this. This is currently urgently needed in many places within Signa Holding, Kreuzer explained. “In any case, it is certainly necessary to bring new capital here, ideally, of course, equity capital, and there is probably now a discussion about where this can come from and who is willing to finance it. The banks probably won’t be there anymore.”
To obtain liquid funds, Signa has already sold the building at Kärntner Straße 11 and a house on Mariahilfer Straße in Vienna this year. In Donaumarina, land with a fully approved plan for Torre Marina was sold to UBM.
Future of Signa seats in Vienna
Signa Holding, which is in crisis, has one of its two headquarters in Vienna and has invested heavily in recent years. “Vienna Today” researched what effects the current situation is having on the city’s projects.
Insider: Property sales are possible
Industry insiders told “Vienna Today” that it was likely that Signa could try to monetize all real estate in Vienna. It is assumed that in projects where there is a partner on board, the shares must be offered to the partners. An example of this is the Vienna Twentytwo project in Donaustadt. It is currently being analyzed whether the partner will completely take over ARE to complete the construction of the remaining two buildings. It is also possible that department store Lamarr’s Thai partner will step in completely. Signa herself does not comment on any of this.