Insolvency hits major real estate group: 14 companies involved

A group of real estate companies is forced to file for bankruptcy. The residential and commercial real estate expert operates 70 projects in 30 different locations in Germany.

Hamburg – The wave of bankruptcies in Germany shows no sign of ending. After the bankruptcy of a nuclear power plant operator, a well-known solar developer and a 200-year-old traditional company, the bankruptcy of a leading construction service provider has now hit another company in the real estate sector. The well-known real estate group Silberbaum from Hamburg is insolvent. This is according to a press release.

Well-known real estate group is insolvent: 14 companies with assets in the hundreds of millions affected

The insolvent Silberbaum real estate group consists of 14 companies and was founded in 2017. The company had to file for insolvency at the Hamburg District Court on Friday (September 6). However, the press release did not state how many jobs could be at stake as a result of the insolvency.

The real estate group’s core business is the development and management of residential and commercial properties. In total, the 14 companies manage 70 real estate properties at more than 30 locations in Germany. The value of the projects is said to be in the three-digit million range.

Large real estate group Silberbaum files for bankruptcy: Reasons are manifold

There are many reasons for the insolvency of the Hamburg-based real estate group. According to the press release, the significantly increased capital costs as a result of interest rate increases since 2022 had a particularly negative impact, which meant that financing costs had risen too sharply.

In addition, the insolvent company with its 14 subsidiaries could no longer cope with the massive cost increases in the construction and energy sectors. Another reason for the insolvency was the declining demand for residential and commercial properties.

Well-known real estate group is insolvent: administrator examines economic basis

After the insolvency application was filed, Peter-Alexander Borchardt from the Reimer law firm was appointed as administrator. The law firm specializes in restructuring and reorganization advice as well as insolvency administration. With 13 insolvency administrators at 10 locations, the partner company is one of the largest and most experienced German law firms for the restructuring of companies and insolvency administration.

The business operations of the insolvent Silberbaum Group will continue in close coordination with Borchardt and his team of experts. In the meantime, the insolvency administrator is examining the economic fundamentals of the group. Options will then be developed as to how the restructuring could be carried out or how the assets could be sold in an orderly manner. “Our most important approach at the moment is to maintain the operation of the real estate properties and stabilize the tenancies,” Borchardt is quoted as saying in the press release. The buildings are supplied in cooperation with the financing financial institutions, so that the property management is guaranteed.

Well-known real estate group files for bankruptcy: Analysis shows worrying trend since the beginning of the year

However, the more recent insolvency is part of a trend that has gained momentum since the beginning of the year, especially in Germany. According to a recent analysis by the Falkensteg management consultancy, which IPPEN.MEDIA The number of major insolvencies rose by 41 percent in the first half of 2024 compared to the same period last year. “Rescuing companies from insolvency is becoming increasingly complex. High interest rates make the acquisition of insolvent companies more expensive or unattractive. “In addition, uncertain sales due to the general economic situation are deterring potential investors,” explains expert Jonas Eckhardt, partner at the Falkensteg management consultancy.

Eckhardt predicts that this trend will continue in the long term and that there will be further bankruptcies, such as at a traditional company, a leading grill supplier, an industry leader with 585 employees or a well-known bratwurst manufacturer: “Many companies have to change in order to be able to survive in the dynamics of international trade.”