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Santander to sell assets out of €3bn fund

Banco Santander, is reportedly selling all the assets out of its Banif Inmobiliario fund. The Spanish bank had to ask permission recently to halt redemptions for two years at the flagship fund.

Banco Stantander, the Spanish bank, has reportedly decided to sell all of the assets in its €3 billion flagship open-ended real estate fund.

Property services firm Richard Ellis has been hired to orchestrate the winding up of Banif Inmobiliario, according to a report in Spanish newspaper Expancion.

The report said Santander has told clients it will sell the assets gradually over a two-year period.

The move comes two months after Santander asked financial regulators if it could halt redemptions.

It said in a company filing that it was seeking to suspend redemptions until February 2011 following attempts by investors to withdraw 80 percent of funds ahead of a revaluation of the real estate.

According to the report, the fund has made some very large purchases approaching the peak of the market. In 2005 for example, it paid Spanish listed company Metrovacesa €138 million for a 50 percent stake in the Edificio Espana office building in Madrid. Under the agreement of that deal Santander also commitment to buy the other half at a later date.