Sberbank plans to invest in real estate - source
MOSCOW Nov 16 (Reuters) - Sberbank SBER03.MM, Russia's biggest lender, is setting up a real estate development firm to make major investments in the sector, a source familiar with the bank's plans told Reuters on Tuesday.
The state-owned bank already has a number of distressed real estate assets on its balance sheet which it acquired during the economic crisis, but the source said the new entity would embark on new projects.
"The new company is being created to deal with new construction projects, not the "toxic" ones, for large-scale investments in construction," the source said.
Sberbank declined to comment.
The distressed real estate assets are parked in a vehicle called Sberbank Capital whose total assets are estimated to be worth about $4 billion. The source said Sberbank Capital would retain those assets.
Sberbank entered into a deal in August to buy 51 percent of DB Development, a joint venture between Deutsche Bank (DBKGn.DE) and Austrian developer Strabag STBGn.DE.
DB Development is focused on real estate and infrastructure deals in Russia and other ex-Soviet countries but one of its projects includes the construction of a residential complex near state resort Barvikha in the Moscow region.
Sberbank also holds around 25 percent of development company Krasnaya Polyana, a major investor in Russia's Black Sea resort of Sochi, which will host the 2014 Winter Olympic games. (Reporting by Oksana Kobzeva; Writing by Katya Golubkova; Editing by Greg Mahlich)
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