Developer Reyal Urbis hits wall in Spain’s second biggest business failure

Reyal Urbis stand at the Madrid property fair gets smaller every year (image courtesy of

Reyal Urbis has finally given up trying to reach an agreement with its creditors and asked to be put into administration.

Stock-market listed Reyal Urbis was unable to cope with repayments on debts of 3.6 billion euros (4 billion if you include debts to the Spanish tax man), so the banks decided to pull the plug on the company rather than throw good money after bad. With the banks refusing to refinance its debts, Reyal Urbis was forced to seek court protection from its creditors.

This is the second biggest business failure in Spanish history. The biggest was another developer called Martinsa-Fadesa back in 2008.

Reyal Urbis was one of several listed developers that managed to refinance its debts when the crisis began, never expecting it to drag on so long. Now those agreements are expiring and banks are no longer willing or able to refinance, so expect a few more high profile casualties in the months to come.

Some Spanish press reports suggest that Reyal Urbis hasn’t built any new homes in the last three years, spending all it’s time and energy just trying to manage its debts. To what extent can companies like Reyal Urbis be called developers if they no longer develop anything?

Reyal Urbis share price since the bubble burst
Reyal Urbis share price since the bubble burst