To make this as simple as possible....the Bayerische Versorgungskammer (BVK) is Germany's largest public pension group, managing around 117billion Euro in assets as of late 2024 for approximately 2.7 million members.
The members? Well....professionals like doctors, architects, and municipal employees in Bavaria.
Bluntly.....BVK did NOT experience a full "financial downfall" or insolvency. They did see aseries of high-profile losses, write-downs, lawsuits, and political scrutiny tied to its U.S. real estate investments since around 2023.
Roughly....1.4-percent of their strategy....crapped-out. Adds up to 700 million Euro 'gone'.
What you have are high-end real estate properties....which for decades had paid off (profit-wise) for rent. Covid-era arrives, and this high-end strategy for the first time ever....is high-risk. So you might have a portfolio of 100 properties paying yearly profits, and wake up two years into Covid....with a majority of the portfolio unable to pay rent/profits, and as you try to dispose of the properties....you discover that original value is now 50 to 90 percent 'gone'.
A big deal? There's some well-to-do Bavarians who are eyeballing their retirement plans (they were expecting a 40-plus-thousand Euro check....giving them a extended-happy-retirement 'bonus' yearly, and now....it's probably 30 to 50 percent less).
Footnote: there are hundreds of banks in the US presently....holding 'dead' portfolio situations....hotels, malls, office buildings....where current value to 'dump' is half or more dissolved. They sit on the books....hoping for some upturn in the real estate market. Just guessing....there are probably more than a thousand hotels on this list (lot in Vegas).
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