The management churn comes amid a toxic cocktail for some of Europe’s largest landlords, who are dealing with short-seller attacks, heavy debt loads and frozen transaction markets that have made de-leveraging a challenge.

It means new faces will be representing some of the big names – now troubled names – from the world of real estate at the annual Mipim conference that starts Tuesday in the French Mediterranean city. From Sweden’s SBB to Germany’s Adler Group SA, the landlords that epitomized the heady days are under new leadership.

Shareholders and creditors are hoping that fresh faces will help steer businesses out of their current troubles.

For some, like Rene Benko’s Signa group of companies, it’s already too late. The once-familiar yacht draped in the company’s colors is unlikely to make an appearance in Cannes.

The rate of personnel turnover can be a “red flag,” said Niamh Brennan from the Centre for Corporate Governance at University College Dublin. “Changes like increasing interest rates in a well-governed company should not lead to people exiting at a high level. The job of directors is to manage risk, that’s a normal part of the job.”

At SBB, founder Ilija Batljan quit as chief executive officer in June, and there’s since been a number of other changes as the firm tries to manage its debts. It’s also under pressure from private investment firm Fir Tree, which is demanding repayment on a bond for alleged breach of terms.

Fir Tree questioned the conduct of the board in December. Two members left that month, citing health reasons and time constraints.

Meanwhile, Batljan himself is standing for reelection to the board, something that Green Street analyst Peter Papadakos says is “suboptimal.”

“Best-in-class corporate governance practices are clearly lacking sometimes, even after such poor performance,” he said. “A lack of activism in Europe versus the US generally doesn’t help.”

A representative for SBB declined to comment.

The churn story has been repeated at other Nordic landlords. Both the CEO and chief financial officer of Swedish firm Oscar Properties quit in recent weeks.

Meanwhile, troubles at Heimstaden Bostad AB, a giant residential landlord based in Malmo, have spilled over to Swedish pension fund Alecta, which marked down the value of its stake by 8.7 billion kronor ($850 million) in the fourth quarter. Alecta is now struggling to appoint a new chairman after two failed efforts. In 2023, it lost its CEO after revealing losses on bets on US regional banks.

Investment Opportunity

But while many executives may miss out on the Cannes sunshine, some have taken the opportunity to start new ventures to capitalize on the distress. Former Blackstone Inc. head of European real estate Chad Pike has started Makorara to focus on private real estate debt and equity, PERE reported, citing a launch document. 

There is a “major cyclical investment opportunity” in the reset of commercial real estate valuations, it said.

Michael Abel, previously an equity partner at TPG Inc., launched Greykite, a European real estate firm backed by Capital Constellation.

It’s a “highly attractive point in the investment cycle,” Abel said. “We see elevated levels of uncertainty and dislocation, but brimming with opportunity.”

Adler Crisis

Some of those opportunities may be in Germany, which is suffering its own property woes. Adler, another short-seller target, saw four board members including its co-chief executive quit in 2022 when a forensic audit of the company was unable to disprove a string of allegations against it. 

Stefan Kirsten, a stalwart of German real estate who made his name overseeing the finances of giant landlord Vonovia SE, was brought in to clear things up as Adler’s new chairman. But his doctors have now advised him to step down from the company, which remains in crisis.

Peach Property Group AG, another owner of German apartments, saw its executive chairman Reto Garzetti quit in October, along with another director, citing differing views on strategy. The company is racing to reduce its debt load in the face of rapidly falling prices that have increased its relative indebtedness. 

There have also been changes at German landlord Corestate Capital Holding SA, a former target of short-seller Muddy Waters that’s since restructured and done a debt-for-equity swap.

Adler, Corestate, and SBB have all also denied the allegations made against them by short-sellers. Adler shares have fallen 98% since the original attack, while SBB is down 91% and Corestate is 99% lower.