Austrian real estate giant Cigna announced on Wednesday that it plans to file for bankruptcy after its German subsidiary had already filed for bankruptcy.
The holding company announced on Thursday that it plans to apply to the Vienna Commercial Court for the initiation of self-administered rehabilitation proceedings.
“Despite significant efforts in recent weeks, Cigna Holding GmbH has filed for self-managed restructuring as it has not been able to secure sufficient liquidity for an out-of-court restructuring,” the company said in a statement. ” he said.
Why are real estate giants suffering?
Once a powerful real estate and retail group, the company has been in crisis in recent weeks. The struggle began with the outbreak of the Ukraine war, which affected the real estate sector across Europe due to rising construction and energy costs and interest rates.
The group owns numerous commercial properties in Germany and Austria, and has a vast portfolio that includes the iconic Chrysler Building in New York. In Germany, it owns the ailing department store group Galleria Karlstadt Kaufhof, and is currently building the 245-meter-tall Elbtower in Hamburg.
However, Reuters reported, citing anonymous sources close to the department store, that Galleria is not expected to be affected by the bankruptcy proceedings.
The company’s owner, retail entrepreneur Rene Benko, announced in early November that he would bow to shareholder pressure and step down as chairman of the Cigna advisory board.
rmt/fb (AFP, dpa)