The local special purpose company (SPC) owned by the Aegis Asset Management's German real estate fund has officially entered bankruptcy proceedings in court.
According to the financial investment industry on the 17th, Aegis Asset Management announced the previous day that formal bankruptcy proceedings had begun for the local SCP that directly owns the Trianon building in Frankfurt, Germany, in relation to Aegis Global Real Estate Investment Trust No. 299 (derivative type).
Aegis Asset Management negotiated with the major creditor group to extend the loan maturity related to the Trianon building, but failed to reach an agreement, leading to the occurrence of event of default (EOD) at the end of May. Aegis Asset Management submitted a petition for the initiation of bankruptcy proceedings to the court in June, and the court accepted it, resulting in the start of bankruptcy proceedings.
Aegis Asset Management noted, "The specific methods of disposal of the Trianon building, such as public auction, execution of collateral, and private sales (transactions between the creditor and the buyer), as well as the progress of financial adjustments, are expected to be determined by the future bankruptcy trustee and local court." They added, "We will provide timely updates on follow-up matters."
Aegis Asset Management raised a total of 370 billion won from institutions and individuals in 2018 to form the fund. It also took out over 500 billion won in loans to purchase the Trianon building for about 900 billion won. However, the value of the Trianon building has been impaired due to the frozen real estate market caused by the COVID-19 pandemic and rising interest rates.