The project was financed by GD in 2007, but the works remained unfinished after the 2008 crisis. The bank had already recognized losses in 2016, but in the meantime managed to recover around half of the money.
A luxury development in the Algarve became one of the biggest losses in the recent history of Caixa Geral de Depósitos (CGD). The Keys project, in the Quinta do Lago area, resulted in a direct loss of 100 million euros in capital and at least another 65 million in unrecovered interest.
The operation was concentrated in the company Birchview, part of a group financed entirely by CGD in 2007, then led by Carlos Santos Ferreira. The financing was intended for British businessman Mark William Lenherr and Portuguese manager Carlos Olavo da Silva, who intended to develop an ambitious tourist and residential project. However, the financial crisis wreaked havoc on the real estate market, leaving the development no buyers, no licenses and no resources to complete the works.
The asset’s accelerated devaluation led to Birchview, and later associated companies Bridgedown and Chapelmoor, into insolvency. CGD, as the main creditor, pushed the cases to court in an attempt to recover part of the investment. In 2017, insolvency confirmed that the Birchview land, valued at 116 million euros, was insufficient to cover a debt that already exceeded 300 million, according to the .
In a sales process conducted by the consultancy Cushman, the real estate assets were placed on the market. The main land ended up selling for 85 million, and Bridgedown contributed to the recovery of around 50 million additional. In total, CGD managed rescue around 140 million euros of the group. This week, the remaining 1.9 million from Birchview’s treasury were distributed to the public bank, ending the apportionment process.
The insolvent estate distributed 93.4 million euros by creditorsincluding the payment of labor credits and tax debts. Several suppliers, such as security or advertising companies, were left without payment.
Despite partial recovery, more than half of the 307 million euros claimed by CGD remains unpaid. The bank had already recognized these losses in 2016, as part of the restructuring supported by the State, but continued efforts to recover additional amounts.
