Sareb ‘bad bank’ takeover by Spain’s government proposed by Spanish entrepreneur

ISMAEL CLEMENTE, the CEO of Socimi Merlin Properties has suggested that it would be appropriate and in keeping with their principals for the new Spanish government to purchase 100 per cent of Sareb, the ‘bad bank’.

It was set up in 2009 by a consortium of investment banks (54 per cent) and the FROB (46 per cent) representing the Spanish government to take over and manage the huge number of properties which were the subject of bad debts.

Since then it has disposed of a number of the properties and also arranged for some incomplete new builds to be finished but still holds a very large portfolio of properties, some commercial but many uninhabited apartments and houses as well as land.

As the cost of renting property across has become more expensive, with a greater demand due to the number of people who either lost their existing properties or are unable to obtain mortgages, the Clemente proposal does resonate with many.

His argument is that because of the shortage of affordable property and in keeping with its socialist ideals, if the government takes over the organisation, it will be able to not only rent out some of the properties directly but could also transfer public land released to developers in order for them to build affordable new housing.

The developers would be able to recover their costs over a period of years (with a reasonable profit margin) and once this has been done, the properties would then be handed over to the State as assets to manage.