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Spanish builders San Jose in financial trouble

San Jose Inversiones is the latest Spanish developer and builder to seek protection from its creditors.

San Jose Inversiones, the developer of the massive golf urbanisation Santa Ana del Monte Jumilla Golf (a.k.a. Jumilla Golf & Country Club), in Jumilla, Murcia, went into voluntary administration on Friday on account of liquidity problems.

San Jose has assets valued at 300 million Euros, but was unable to meet payments due of 30 million Euros.

San Jose property Spain

San Jose Inversiones has sold thousands of properties during the boom, many of them off-plan to British investors. Along with Jumilla Golf in Murcia, San Jose also has various other large golf developments in Murcia and the Costa Blanca, for example Playa Golf in La Dehesa de Campoamor, Albatera Golf, and Dolores Golf, which only recently obtained planning approval.

By voluntarily seeking protection from its creditors (known in Spain as ‘concurso de acreedores voluntario’), San Jose Inversiones can continue to trade under the supervision of court-appointed administrators. However, if the company is unable to renegotiate its debts and come up with a viable business plan it will eventually go into liquidation.

Clients who have purchased property off-plan from San Jose Inversiones could lose some or all of their stage payments. San Jose Inversiones did not, as a rule, provide buyers with bank guarantees, despite a legal obligation to do so.

Developer Idearco also in trouble

It has also been reported in the Spanish press that the developer Idearco shut down last week leaving hundreds of buyers with unfinished developments. Idearco is a midsized developer in the Alicante region.