Thursday, December 9

The Selgas-Fagalde Foundation bought the Seville hotel from two companies related to its president

With this operation, the board of the Foundation liberated and 2006 de mortgage charges two companies that their president represents as a director and a non-profit institution took over the business whose main objective is to maintain the patrimonial complex of the palace that the Selgas family had in Cudillero (Asturias) and a wealthy artistic heritage that includes

paintings by El Greco or Goya

sold to the Friends of the Prado.

From the analysis of all the accounts deposited by the entity in both the Foundations Registry and the Mercantile Registry, it can be concluded that the Foundation paid 20.3 million euros in December 2006 to acquire the Hotel Sevilla Congresos, a four-star hotel, a amount I know It increased by 3.6 million euros in 2014, the year in which the building’s facilities were renovated. He still made several more investments, the last in 2020, when he sold Goya’s ‘Winning Hannibal’ despite the statutes providing otherwise, up to a total of 24.7 million.

When the Foundation signed the purchase of the hotel, according to the Property Registry, took over the mortgage that Desarrollos Turísticos Urbanos and Posadas de España had with BBVA, at that time 12.7 million. In 2005, Desarrollos Turísticos had extended the first loan of 7.2 million that the bank had granted to it by 5.5 million.

In this operation, the Selgas-Fagalde Foundation assumed the debts of two companies with which Gregorio Peña has been related since 1999. That year he joined the board of directors of Desarrollos Turísticos Urbanos as secretary and advisor, and in Posadas he registered as secretary. A year later, in October 2000, he also joined the latter as a counselor.

Income from leases fell dramatically due to Covid

After taking over the loan signed by Desarrollos Turísticos y Posadas, the Selgas-Fagalde Foundation expanded in 2013 the mortgage of the Hotel Sevilla Congresos for a value of one million euros up to 13.7 million. And even in 2014, the loan was extended by another 3.5 million to 17.2 million with the commitment to return them before July 2029.

For this hotel the Foundation had to face another payment of 164,076 euros to the company Hotusa, former tenants, after ordering the Provincial Court of Seville and then the Supreme Court the return of the bond in a lawsuit on the “state of conservation and deterioration of the hotel business.” Now the farm is rented to the company Inversiones Martín Moreno for a twenty-year contract that expires in 2034.

Collapse of the financial bubble

The Seville hotel was not the only real estate business in which the Foundation was involved in 2006, when the collapse of the financial bubble. In July of that year, it paid 7.7 million for two buildings on Calle Pedrezuela 5 and 7 (Madrid), made up of 20 homes and 41 parking spaces. Selgas-Fagalde reached 2008, the year in which the great recession began, compromised by two investments that exceeded 28 million euros.

To meet these payments, the Foundation registered in its accounts a first loan to BBVA for a value of 10.4 million euros in 2006, which in 2013, 2014, 2016, 2017 and finally in 2020 was expanded to exceed 17 million euros. Foundation sources told ABC yesterday that, except for the 3.5 million loan that effectively financed the renovation of the facilities, the rest of the mortgage extensions they were destined to investments to improve and maintain the Quinta de Cudillero.

The entity took over the 12.7 million mortgage signed by the sellers

«All the csurplus apital has gone to enrich the Quinta »said sources yesterday. The purchase of the hotel from companies, according to them, does not imply any type of conflict of interest, since it was the board of trustees, unanimously, who approved the operation. In addition to the nominal patrons, the Council of Culture of the Principality, the City Council of Cudillero, the Archdiocese of Oviedo and the University of Oviedo sit on the board.

«After 15 years, the hotel has increased its value and it has generated a profitability much higher than its purchase price. With its performance, the hotel has already paid off. It is the largest income support », justify sources of the foundation. Thanks to his relationship with Desarrollos Turísticos, he found out about this asset, saw that it was a very profitable operation and raised it with the board of trustees: “It was approved unanimously. The goal was to have more healthy accounts. We bought the hotel below its valuation », indicate these sources.

The “profitability” of the hotel, of course, has not solved the economic difficulties of the foundation. At the end of 2020, the institution accumulated a debt with credit institutions and creditors of more than 7.3 million euros, a figure higher than the 6.9 million they owed in 2019, and a red number in the balance of 6, 4 million euros.

Sale of the Goya

If you cannot talk about bankruptcy, explains an accounting expert consulted by ABC, it is because Selgas-Fagalde can resort to an estate that around 95 million euros to attend to your pending payments. Therein lies the paradox: a foundation whose statutory objective is to care for and keep together all the elements of its collection has ended up selling the most valuable paintings in its collection to solve its liquidity problems.

The sale of the Goya for more than three million euros has meant an injection of liquidity in a treasury with which it was not possible to face outstanding debts. At the end of 2019, the entity barely had 660,000 euros in cash to face annual payments that were around 700,000 euros while registering red numbers on its balance sheet of more than 3 million euros for the ongoing losses it recorded between 2014 and 2017.

In 2020, after disposing of the ‘Victorian Hannibal’ from the artistic collection that the Selgas-Fagalde left as a legacy, the cash increased to 4.2 million. With them you must pay your debtors. “We have liquidity to repay loans for the next three or four years,” sources from the foundation explained yesterday to ABC. The board of trustees also approved the sale of a painting by El Greco for 7 million euros, but Culture prevented the operation.

To pay for the maintenance of the whole of the Quinta –its gardens, the artistic collection… -, the foundation chaired by Gregorio Peña allocates what they receive from visits and book sales and from the rental of properties located in the Salamanca district of Madrid and the businesses acquired in 2006. According to sources consulted, these investments were made because with what they had been entering until then from the foundation endowment they could not bear the expenses of the palace.

Income crash

In 2020 all its income plummeted due to the coronavirus crisis. If for the visits they received 110,274 euros in 2019, last year only 43 euros were recorded. For the rentals of the estates on Puigcerdá, Velázquez and Pedrezuela streets, all of them in Madrid, and the hotel in Seville, they generated revenues of just over 2.1 million in 2019. In 2020 it fell to 1.4 million due to the rent bonuses made to tenants by the Covid.

All the figures fall far short of what was foreseen in the 2020 action plan, the roadmap with goals and objectives that these entities elaborate. In it they marked a potential income of more than 8 million for the leasing of their properties, four times more than what they have been receiving these years.

This plan made no reference to the disposal of assets that the Fagalde sisters left in the hands of the Foundation guided by the principle “facilitating culture is making a homeland.”

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