Lone Star sells estate held by Novobanco at knock-down price

An estate near Sessimbra in Portugal, which was in the hands of Novobanco, was sold at a knock-down price to the wife of one of the former managers of US firm Lone Star which holds a 75% stake in the bank.

The 260 hectare Herdade da Ferraria was sold in 2022 by GNB Real Estate, Novobanco’s real estate asset management arm, for €1.5 million to Ana Flor Argos, the wife of former GNB Real Estate manager Volkert Reig Schmidt whose LinkedIn states he is a Managing Director at Novobanco.

Reig Schmidt was denounced to the Portuguese securities market regulator over a conflict of interest.

GNB Real Estate is a leading real estate, estate asset management entity in Portugal managing more than €1.5Bn under management. The company is part of the Novobanco Group.

The property was sold as “rustic and abandoned” despite having a construction capacity on 50,441,14 square metres, of which 5,000 square metres can be earmarked for private residential housing.

Given the size and potential of the estate, one experienced real estate analyst, who has not been named, has suggested that the real market value for the property should be closer to €10-€15 million according to the daily news source Público.

All of the parties involved in the sale had received all of the necessary information which included reporting the sale to the Real Estate Investment Commission (CII), which they didn’t.

CEO of Novobanco, Mark Bourke, is said to have stated that “all of the parties (including all of the potential buyers), and relevant decision-makers received all of the information necessary to take informed decisions”.