10.8. 2021: The report date before the creditors’ meeting of the German Property subsidiary Dolphin Capital 80 Projekt GmbH & Co. KG (DC 80) took place in Bremen today. Insolvency administrator Justus von Buchwaldt from the restructuring law firm BBL reported to the creditors on the status of the proceedings. The meeting confirmed the creditors’ committee provisionally appointed on June 11, 2021.
The seven members of the creditors’ committee (GA) are for the most part also members of the five-member creditors’ committee of the insolvent parent company AS German Property Group GmbH (GPG). They represent substantial claims (in the high three-digit million range) against GPG, among them are legal representatives of the international small and large creditors, especially of institutional creditors. In addition, the creditors’ committee of DC 80 includes two proven specialists in international insolvency law, one for international insolvency and one for insolvency administration. The task of the creditors’ committee is to support and monitor the insolvency administrator, and in doing so they are bound to absolute confidentiality.
DC 80 acted as the capital collection agent of the insolvent parent company, AS German Property Group GmbH (GPG), through which a large part of the funds of the British and Irish investors were collected and distributed both within the group and to third parties. Justus von Buchwaldt has written to all creditors of DC 80 of which he has become aware, inviting them to file claims. The court has set the date of 23 September 2021 for the examination of the claims filed, which will be conducted by written procedure. The website set up specifically for the proceedings (proceedings portal German Property Group (https://www.gpg-inso.de/overview) provides ongoing information on the status of the insolvency proceedings.
Report before the creditors’ meeting
As the insolvency administrator reported to the creditors present, the BBl team has so far recorded around 6.700 claim registrations to DC 80, which amount to a total of around 794 million euros. In addition, numerous claims have been filed against the parent company AS German Property Group GmbH (GPG) and various individual companies.
Around 15,000 to 20,000 investors are invested worldwide, and their total investment in the GPG Group is estimated to be between EUR 1 billion and EUR 1.5 billion. Investors mainly from England, Ireland, France, Singapore, Japan and South Korea are largely small investors (investment from 10,000 euros), but also institutional investors. The claims are offset by about 50-60 properties of very different value.
Von Buchwaldt explained: “This is only a snapshot as we keep receiving indications of further properties.” The tasks of the insolvency administration include not least the Germany-wide registration, insurance and, if necessary, securing of the properties; in individual cases, sales transactions in liquidation must be examined, accompanied or even prevented. Any land charges are examined in detail and, if necessary, negotiations are held with creditors who are actually entitled to separate satisfaction. The properties must also be valued and prepared for orderly liquidation. Since July 2021, 20 properties are in preparation to be sold with the help of an external real estate specialist.
Justus von Buchwaldt, insolvency administrator of GPG since 15 October 2020 as well as insolvency administrator of numerous other subsidiaries, had been appointed as insolvency administrator of DC 80 by the Bremen District Court on 12 May 2021. From this instance he and his team, with the help of a law firm in the UK specialized in financial fraud, have been investigating the international interconnections and payment flows of DC 80 in order to also uncover and secure all relevant assets abroad. This also involves identifying potential claims and claimants beyond GPG’s immediate sphere of influence. The aim is to identify and recover payments and dispositions made by the debtor that are unlawful or have been made in a contestable manner to the detriment of the insolvency estate.
“Unfortunately, most of the debtor’s accounts that were held as trust accounts are located abroad. This makes the investigation much more difficult,” Justus von Buchwaldt explained before the creditors’ meeting. The settlement of the proceedings will take several years and there will not be a uniform quota in the foreseeable future. Considering the current legal situation the quota for the unsecured creditors would probably have to be determined individually for each company in each proceeding and could therefore also be very different.
In addition to cooperating with the investors and their representatives, it is intended that the BBL team will also work closely together with the British financial market regulator FCA, the Serious Fraud Office. The cooperation with the Financial Services Compensation Scheme (FSCS), which in many cases has settled the claims of British investors against DC 80, was already intensified with the opening of proceedings.
BBL Brockdorff Rechtsanwaltsgesellschaft mbH has been one of the leading law firms in Germany with a clear focus on special situations – restructuring, reorganization and insolvency – for many years. The firm is present throughout Germany with around 170 employees, including 45 lawyers, and operates an office in London. BBL offers support of restructuring projects for crisis management and of insolvency proceedings in self-administration.
Tel. +49 (89) 286593-29