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[Alpha Biz=(Chicago) Reporter Kim Jisun] Hana Securities failed to "selldown" "The Square," Germany's largest office building it bought in 2019, risking hundreds of billions of won in losses from a plunge in real estate value.
According to the financial investment industry on the 6th, Hana Securities mobilized 1 trillion won to buy The Square building four years ago and tried to resell them to institutional investors, including major deductions and pension funds, but all of them were not sold.
When Blackstone, the world's largest private equity fund, sold The Square in 2019, Hana Securities and British asset manager AGC Equity Partners formed a consortium and jointly acquired it by investing 270 billion won and 292.5 billion won, respectively.
Hana Securities, which failed to sell down, directly invested 270 billion won through a fund set up by Hana Alternative Asset Management and DS Asset Management, while the remaining 770 billion won took out loans from local financial firms to cover the acquisition funds. Currently, the fund trust has been transferred to Capstone Asset Management's Capstone EU General Private Equity Investment Trust No. 12 (qualification) and Capstone EU General Private Equity Investment Trust No. 13 (specialization).
If the building price does not recover before November next year when the fund expires, Hana Securities will lose most of its equity capital injected into the fund. On top of that, the rise in the benchmark interest rate has increased the burden of interest costs, raising the possibility that defaults could occur as loans could not be paid back at the end of 2026, the expiration date of the building's trust.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
