Signa Prime Selection AG, a key subsidiary of the now insolvent Austrian Signa Holding that owns prestigious real estate in Germany, filed for bankruptcy on Thursday.
The company announced that it had filed for debtor-in-possession reorganization proceedings with the Vienna Commercial Court. It said the Signa Development Selection AG would follow suit on Friday.
“The aim is the organized continuation of business operations within the framework of self-administration and the sustainable restructuring of the company,” the company said in a press release.
The online sporting goods division Signa Sports United had already filed for insolvency in October, while Signa Holding itself and several smaller subsidiaries announced their insolvency in recent weeks.
What are the subsidiaries concerned?
Signa Prime Selection owns the luxury KaDeWe department store in the German capital, Berlin, the Elbtower in Hamburg, and properties of the Galeria Karstadt Kaufhof department store chain, among other things.
It builds and lets properties, leaving the retail operations of the department stores to other businesses.
According to the company website, it owns properties worth a total of €20.4 billion ($22.7 billion). Its annual report for 2022 listed liabilities of almost €10.8 billion at the end of the previous year.
Signa Development focuses on residential and commercial urban development projects. The current balance sheet total is stated on its website as €4.6 billion.
Signa Holding, a network of some 1,000 companies, is owned by Austrian real estate and retail mogul Rene Benko.
The network has recently been beset by the higher building costs, energy prices, and interest rates that have dogged the entire property sector of late, while the brick-and-mortar retail sector is also struggling, partly against online competition.
The holding firm filed for insolvency in November this year.
tj/rc (dpa, Reuters)