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BaFin takes action: files for insolvency against real estate giant
BaFin intervenes after a real estate giant goes bankrupt. Find out how the financial regulator is reacting and what this means for investors. #Real estate crisis #BaFin #Insolvency
BaFin takes action: files for insolvency against real estate giant
The current crisis in the construction industry has hit a strong real estate giant from Wiesbaden, Deutsche Invest Immobilien (D.i.i), hard. In response, the Federal Financial Supervisory Authority (BaFin) filed for insolvency against d.i.i. on April 17th. Investment GmbH, a subsidiary of the D.i.i Group. This was done to secure the assets of this company in an orderly process, as announced by BaFin.
The d.i.i. Investment GmbH, which manages investment funds worth 621 million euros, is in a difficult situation. Of the 16 funds affected, 14 invest in real estate exclusively for professional investors and two for private individuals. BaFin's measures, such as the moratorium and the bankruptcy filing, are intended to secure the money invested and limit damage to investors.
BaFin advises affected investors to contact the number provided if they have any questions. It is emphasized that investment companies supervised by BaFin cannot independently file for insolvency. This intervention by BaFin illustrates the extent of the crisis at D.i.i.
The construction and real estate industry is experiencing a deep crisis in which D.i.i. is just one example of numerous bankruptcies. With more and more companies in trouble, quick improvement is not in the cards. The tension is particularly evident in German housing construction, with almost one in five companies reporting canceled orders.
The current forecasts of the Atradius insurance company are characterized by a significant increase in bankruptcies in the construction industry of 10 to 15 percent compared to the previous year. In 2023, the number of construction bankruptcies increased by 21 percent compared to the previous year, and bankruptcies have exceeded pre-pandemic levels. This development indicates that the crisis in the construction industry could worsen further in the coming months.