Struggling car giant asks Jones Lang LaSalle to raise up to €200m from Euro sale and leasebacks
Stricken global car giant General Motors hopes to raise more than $750m (£499m) from sale and leasebacks across its global estate.
The US motor manufacturer – which owns some of the world’s most famous car brands, including Cadillac and Hummer, as well as Vauxhall in the UK – has appointed Jones Lang LaSalle to advise on €200m (£169m) of disposals across Europe and the UK.
In the US, it seeks to raise $500m (£330m) from a sale and leaseback of its 5.5m sq ft Detroit headquarters, the Renaissance Center.
General Motors is one of the ‘big three’ car makers in the US, along with Ford and Chrysler. It has been hit badly by the global downturn and this week was forced to go ‘cap in hand’ to the Senate with two other car companies to ask for a $25bn (£16bn) bailout.
A General Motors spokesman said: ‘In the light of the cash crunch, we are exploring a range of options that will allow us to improve our liquidity position.’
JLL confirmed that its corporate finance division had been appointed to advise General Motors on its asset strategy for its non-manufacturing sites in Europe, but declined to comment further.
The European headquarters of some of General Motors’ key brands, from Chevrolet to Vauxhall, could be put on the market.
The first property to come to the market is a Saab site in Sweden. The commercial offices of Saab are based in Gothenburg and Trollhattan.
It is likely to investigate the sale of the Vauxhall headquarters in Luton, Bedfordshire, in the UK, as well as other key properties, including General Motors’ headquarters on Sandyford Business Estate in Dublin.
The individual sales should raise between €5m and €50m (£4.2m and £42.1m) each. General Motors owns more than $43bn (£29bn) of real estate worldwide, including factories, totalling hundreds of millions of square feet.
According to JLL research – Corporate Capital Markets, Opportunities in the Credit Crunch – the strategy is sound. The report, put together by Matt Richards and Michael Evans, said: ‘Now corporates are looking at property disposals as an alternative to debt or equity financing since it may be more easily available and affordable.
‘Corporates will need to bear in mind, however, the new pricing environment in which commercial property investors are operating.’
Banks are also looking at sale and leasebacks. Fortis, BBVA and Banco Sabadell have put huge portfolios on the market, Cushman & Wakefield’s Banking Briefing reported this week.
The top 43 European banks have €63bn (£53bn) of property on their balance sheets.