Reasons to be cheerful ? An update.

I have received the following newspaper article from the La Torre residents website.

The final paragraph is the most significant to our hopes, so I am placing it here with the full text below. I can't say I feel qualified to comment but  the following comment from the bank appears to be a hopeful sign.


The strong message coming from the banks is that no-one can afford to see Polaris go down. The vice president of the Cambank said yesterday, "Polaris is a leading flagship in the region. I believe that we have to give a margin of confidence for the good of all."
He also added that the bank had reached agreement with the constructor before, and was confident that the same thing could happen again.

The full article is as follows:

Following Mondays shock announcement that Polaris World has sought judicial protection from creditors, more details have emerged about the attempts of the company to re-finance and avoid the current situation.
It transpires that most of the existing debt has been incurred since the autumn, with sluggish sales exacerbating the situation.
The current debts of around 100,000,000 euros have been generated by ongoing expenses,  operating costs, and money owed to ancillary suppliers and contractors, as well as debts owed to local municipalities which have now become due.
The two municipalities who are most affected by the financial problems of the construction giant are Torre Pacheco, which houses several of the major established developments and Alhama de Murcia which is home to the new Condado de Alhama.
Monies due to be paid to the two municipalities this coming year total 17 million euros, excluding 8 million which was paid earlier this month, part of which was a hefty interest charge for late payment of the monies owed.
A further 9 million euros is due to be paid to Alhama council at the end of this month, although Alhama councillor for urbanism, Jose Espadas, was at pains yesterday to assure residents of the municipality that the council has sufficient bank guarantees in place to ensure that residents will not be adversely affected by the financial situation of the developer.
He explained that as the urbanization has residents occupying many of the 3000 homes that have already been constructed, the municipality has responsibilities for the maintenance of transport infrastructure and public services, which they are now legally bound to maintain.
Although only 3000 of the planned 30,000 have actually been constructed, commitments have been made to infrastructure construction and payment still has to be made for the cost of the new roads built and costs incurred.
Polaris World admitted yesterday that their employees and creditors had been advised that the company was seeking judicial protection before the news was made public , although one or two pointed comments in the press were made about the date of the judicial declaration .
The declaration was lodged on 22^nd December, a day that the eyes of the country were focused on the El Gordo lottery draw, giving the company a few days breathing space before the news leaked  that the company were in deep financial trouble.
The news came out on Monday, on the same day that representatives from the company were meeting with the banks in Valencia, to try and maintain the liquidity of Polaris World.
15 of the operating companies within the umbrella group of Polaris are known to be on the list of insolvent operations.
The company has been struggling for several months, sales and the value of sales  struggling as the economic crisis continues and the property market wallows in the muds of its own making.
The truth is that Spain has just built too many houses and allowed construction to create a situation of excelled economic growth which is now fuelling the economic disaster facing the country in 2010.
Real growth in Spain was running at nearly double that of the rest of Europe before the recession struck, driven by construction, building 750,000 new homes in 2006 alone, more than the rest of Europe put together!
Rising house prices worldwide made construction an incredibly lucrative profession, and prices rose in Spain as buyers flocked to snap up off-plan developments with the lure of excellent profits, and who could blame them, prices between 1997 and 2007 rose by over 200%.
The massive problems with the American market, however, converted a small rolling ball of snow into an avalanche, and many developers have been caught out by the sudden drop-off in purchasing, exacerbated by the horror stories which have surfaced in recent months about the people who have lost vast amounts of money on Spanish constructions, and the lack of credit availability.
The buyers have stopped buying.
And now over a million properties lie empty and unsold, experts estimating that it will take several years to unblock the glut.
The solution for many cash strapped developers has been to surrender their properties to the banks in lieu of debts.
At the beginning of November banks were estimated to be holding 36 billion euros worth of surrendered  property assets.
This is the route adopted by Polaris back in October when their indebtedness to the banks reached a staggering 1000 million euros.
At the beginning of October, when planning approval was received for the second phase of the Condado de Alhama, the company sought to eliminate the burden of debt by coming to an arrangement with the banks to exchange ownership of vast numbers of properties to pay off their debts, which means that many properties now for sale on the urbanizations are owned by the banks, not Polaris.
The company still continues to market the properties via its' network of agencies and run the developments.
Bancaja and Caja Mediterraneo are the two banks with the greatest holdings in Polaris World, and although they are unwilling to divulge their holdings, they are certainly the owners of more than 1000 Polaris World properties.
Polaris now wish to come to another arrangement which will give them liquidity to pay off their debts and allow them to continue with existing projects, although for the banks the risk is growing daily.
Adverse publicity in the British Press about some of the experiences of those who have been caught in the property downturn has lead to a confidence crisis. The property rentals market at the moment is booming, as buyers sit on their wallets and wait for the bargains to come along.
Banks in the north of Spain have been offloading properties at discount prices to reduce their indebtedness, the buyers snapping up top value properties at low prices.
Recent economic reports indicate that Spain needs to reduce its' prices by 20% to recover economically from the current crisis, so now is not the best time to be sitting on 36 billion euros worth of property if you need ready cash, so banks have to be careful that they do not burden themselves with too heavy a burden of unsaleable properties.
Saying that, if someone owes you 1000 euros it's not such a big problem. But if someone owes you 100 million euros you have to be flexible.
Estate agents report that good value , top of the range , and properties on established urbanizations are still selling well, but there is a static glut of lower quality properties.
The strong message coming from the banks is that no-one can afford to see Polaris go down. The vice president of the Cambank said yesterday, "Polaris is a leading flagship in the region. I believe that we have to give a margin of confidence for the good of all."
He also added that the bank had reached agreement with the constructor before, and was confident that the same thing could happen again.
 

Oh Dear

I assume that by now you will all have heard that PW have made a legal application in connection with bankruptcy.

I do not understand exactly what is involved and think it will be some time before we know the implications not only for Terrazas but for all the PW resorts.

I suppose that it is just possible that the will successfully renegotiate their debts and find a way out of the apparent problems.

That said perhaps the best thing we can do at present is to seek advice from our respective solicitors based on our individual circumstances as I suspect there isn't a one size fits all answer.

It will be a nervous time waiting for things to develop, one thing is certain, we are unlikey to hear anything directly from Polaris World.

Happy Christmas

Just a quick post to thank all who have supported this blog and contributed their photographs and experiences at Terrazas this year.

I think that we have all been pleasantly surprised by the developments at Terrazas in what has no doubt been a very difficult year financially for developers.

It has been a good year personally as I have now got a home in Spain albeit at La Torre rather than Terrazas!

In the coming year lets hope we see Terrazas transformed as the new residents on Phase 2 / 12 take possession and with luck we will see the growth of the Town Centre and the Old House which looks like it will be the clubhouse.

At last we can say with some certainty that there will be golf at Terrazas! Nicklaus Design are saying there will be a competition in May. See:
http://www.nicklausgolftrail.es/nicklausgolftrail/Home.xhtml
 
Happy Christmas and a great New Year to everyone.

Dave

Terrazas open for Golf !!! - Well not really.

Just a day or two after Graham confirmed that the course is unlikely to be played this year comes the shock news that people are already playing. Many thanks to Gerry for the most recent pictures.

OK it may not be golf as we know it but humans with golf bags have been seen on the course. No flagsticks, no tee markers and certainly no official sanction but here is the proof:

There are rumours that Polaris are circulating this picture to identify the culprits, other stories suggest the hire of a hitman!

There they are again in the distance playing what was to have been the 18th hole.

Gerry reports that there was excellent weather with warm days but cold nights and you can see from the pics that there are beautiful blue skies and a great view down to the La Manga strip.

Gerry got pretty close to the Town Centre, Hacienda and to Phase 2/12. Everything looks good with the benefit of good sunlight as the following pictures show:

The Clubhouse !

Gerry also took a good look around the golf course and it is certainly taking shape, Gerry says he thinks Jack Nicklaus is having a laugh with some of the slopes on the greens andf the depth of some of the bunkers but after all it was Jack Nicklaus who was quoted as saying "golf was never meant to be fair" so it looks like he is taking that through into his design business.

I trust that you can pick out the humps and hollows in the pics.

Many thanks to Gerry for the photos and the startling news!!

Remember, if you are going out to Terrazas - I WANT YOUR PHOTOGRAPHS - its good to share.

News on Terrazas

Hi All

Thanks to Graham for more photos after his recent visit.

 

Progress continues on phase 2/12 , the Town Centre and the Old Hacienda.

Graham was in awe of El Don's visit to the Hacienda as he had tried to pay a visit  himself only for the same security guard to turn up like a bad smell. Every time he went round a corner the guy would appear by magic as if anticipating every move even after Graham had thought he had given the guy the slip.

 

 

 

 

One thing Graham has managed to do for us all is find out what future holds for the Hacienda. On a recent visit El Don was told that it was to be used as a wine cellar and various other possibilities have been proposed, of course PW's line has been that it will be a "chill-out" bar and it was to have an horizon swimming pool outside.

It now appears that it will be the clubhouse according to Graham's informant at Polaris World. The holes are to be renumbered, presumeably so that the course will start and finish near the clubhouse. I haven't worked out the likely combo, but it would appear the would be 18th with water all the way along the left of the hole and an approach over water will no longer be the final threat!

Speaking of the course Graham had a good look at some greens and says they look quite wooly and not nearly ready for play so it appears that unfortunately my contention that there will be no golf on Terrazas in 2009 will be correct. It seems more likely that the Nicklaus Design estimate of May 2010 is the likely opening.

 

 

Thanks for the photos and the information Graham.

The Old Hacienda at Terrazas

As we all know, access to certain areas on Terrazas is closely guarded by our friends at PW. Indeed for some of us subterfuge is required even to set foot on the hallowed ground.

Photographs come to me of the interior of the Old Hacienda and not even a pair of rusty pliers could get me to reveal my source - so don't worry El Don & trusty sidekick Dave Mol, your secret is safe with me.

Our intrepid pair were sitting one late afternoon soaking up the sun and an unhealthy dose of the local hooch. As often happens, drink in, wit out and El Don & Dave started musing about how well Terrazas was coming on.

"Wonder what the Hacienda looks like" said El Don. "Get your camera" Dave said and off they went to investigate.

Suitably fortified with drink they slipped into their black turtle-necks & 007 mode and gave security the slip by swimming across the lake onto El Don's island and slipped through a hole in the fence.

These are the results:

Returning the way they came, back across the lake with El Don using one hand to swim & one to hold the camera. They scrambled up the bank where El Don was exhausted from the effort and Dave Mol kindly offered a piggy back to get the prized pics back up to phase 1.

Thanks guys, the place will hopefully look better in time and next time you visit with any luck you will be able to walk in, have a beer and walk out, dry outside and nicely wet on the inside instead of the other way around.

Attention Las Islas Buyers

Thanks again to The Godfather, who boldly goes where others fail to get access.

This months scoop is a series of exterior photographs on the island at Condado de Alhama.

The pictures concentrate on the 3rd floor corner properties which both the Godfather and I have reserved at Las Islas at Terazzas. Never the less there should be enough to interest all potential "Island Dwellers."

 

I would be very interested to hear your views on these properties.

I have to say that having become used to my white townhouse on La Torre I am not overly impressed with the colour which is as it will be on the islands at Terrazas.

Of course I knew that the property would be a terracotta shade but seeing it in reality it appears a little disappointing.

All abit academic at present since there is no indication as to when the building may commence.

El Don's latest pictures of La Torre

My good friend, The Godfather has recently returned to the damp and floods in old Blighty from his bolt-hole on Phase1.


He sent me the few photos above and they can speak for themselves but it is great to see that several of the new blocks are looking more or less completed on the exteriors, the golf course continues to look better everytime I see it and the Town Centre is progressing.


Graham is out there at present and has promised me some pics when he returns so hopefully some more to keep the optimism bubbling along.


No further word on any further stages to report.