Spanish property developer Martinsa files for liquidation bankruptcy

Spanish property developer Martinsa Fadesa, a symbol of the excesses that led to Spain's property bubble collapse, on Monday said it would file for liquidation bankruptcy after failing to win support from banks for its latest debt repayment plan.
"The board has decided today to ask for the start of judicial liquidation," the company said in a regulatory filing.
Martinsa Fadesa, a builder of homes, malls and golf courses which is active mainly in Europe, said Friday it holds assets worth 2.4 billion euros ($2.7 billion) to meet debts worth 7.0 billion euros, making it one of the biggest bankruptcies in Spanish history.
The company sought voluntary creditor protection in July 2008 after it failed to get a loan to refinance its debt and became the first major casualty of the crisis in Spain's housing market.
It spent almost three years under creditor protection before reaching an agreement with creditors in March 2011.
As part of the accord, the company agreed to make annual debt payments for eight years and sell assets but it has struggled to make payments.
The company was created through Martinsa's debt-financed takeover of Fadesa for over 4.0 billion euros in 2007, just before Spain's real estate boom collapsed due to rising interest rates, more restrictive lending standards and oversupply.
Spain plunged into recession when the property bubble burst, forcing the government to bail out the financial system and enforce austerity measures that left one in four workers nationwide unemployed.
Like Martinsa Fadesa several other large real estate firms have declared bankruptcy, such as Sacresa which was saddled with 1.8 billion euros in debt and Reyal Urbis which drowned under a debt pile of over 3.6 billion euros.