Danish real estate consultant starts project repositioning business

Danish real estate consultant Bjarne Virenfeldt, who spent almost a year as head of operations at Tiriac Imobiliare before leaving the company in October last year, has moved into project restructuring and repositioning through his own company Sun Evolution. The firm is currently working on five projects whose fair market valuation exceeds EUR 100 million, Virenfeldt told Business Review. Two of these developments are in Bucharest and the rest in secondary cities in Romania. They come from the residential, logistic and retail segments. The Dane hopes to finish one of these repositioning projects with a deal in a couple of weeks.

Sun Evolution, which has a staff of 30, including technical staff, lawyers and accountants, takes on projects that are approaching or are already in distress. The firm works with investors or developers and with the banks that financed the projects. Sun Evolution seeks to reposition the projects in order to avoid or minimize potential losses to developers, investors and banks. Each repositioning is done with a potential final investor in mind, according to Virenfeldt. “The perception that there is no money on the market is not true, there is plenty. The difference from two years ago is that today’s prospective investors generally are focusing on taking the advantage of the current depressed market situation,” he said. However, he hopes there will only be a brief need for project repositioning and also for more realistic pricing on the market. Similarly, he hopes for an adjustment and stabilization of the cost and pricing level within the real-estate and construction market

For a bank, taking over a distressed asset and repositioning it is a lengthy process and incurs additional costs. Bankruptcy procedures, if executed are similarly very time-consuming and costly as the subsequent auction of a property seized through this procedure normally takes place after the completed bankruptcy procedures. Banks therefore prefer to avoid this procedures by engaging the services of specialized companies for repositioning projects. “We are always taking – often hugely – different or creative approaches to re-positioning scenarios. This in order for us to identify at least two or three scenarios which we can start developing” Virenfeldt said.

Corina Saceanu

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