In many countries of the world, it is common for dozens of large-scale properties to be displayed with images of abandonment and devaluation, and this is often the case with real estate equipment that may in some cases have been left inside these abandoned facilities. These facilities once housed powerful businesses and industries.
The reason for this situation is not usually the lack of investment interest, but the changes in the Bankruptcy Code of the country or the bankruptcy code are not sufficient. In this way, however, gray areas are created and eventually freeze the sales in large properties.
If a country’s bankruptcy code is not sufficient, in the sense that it does not include second-hand debt settlement articles in bankruptcy auctions, then the problem remains. In some cases, the law stipulates that for companies that have gone bankrupt since there was no successful bidder after five attempts in an auction court, and there is no provision for these properties to be auctioned online, this is another obstacle.
However, before it can be transferred to an online auction, a general assembly must be convened shortly (with the participation of representatives of banks, the public, insurance funds, suppliers, employees, etc.) to approve the conduct of online auctions at that time, it is possible to file an opposition.
And this is because in barren auctions, a reduction of the price of the first offer is usually ordered, with court decisions or even orders of rapporteurs. But an anti-auction opposition traps the process in an endless, vicious circle. In several countries, it can take years for an opposition decision to be issued.
At the same time, additional costs are incurred for the maintenance of the facilities, for accountants’ fees and compensation of syndicates. As a result, huge plots of land, as well as building facilities and equipment are being devalued. Creditors risk being compensated with much less money, because over time the assets depreciate.
In addition, the sale of real estate companies online, which may have gone bankrupt several years ago, requires pricing and valuation at current auction prices, a process that involves long delays and increased costs.
What is required, however, is that with all these obstacles, a large number and volume of real estate surface accumulate, which remain unused, while the effort to reopen them is of great difficulty.