Signa Group founder and prominent European property tycoon Rene Benko is handing over chairmanship of the real estate company he founded to restructuring expert Arndt Geiwitz, the company said on Wednesday, amid a crisis in the property sector.
The group has been navigating the biggest real estate crisis in decades in Germany, its most important market, amid high interest rates, cautious banks and uncertain valuations, which spurred credit rating agency Fitch to downgrade a Signa division to junk this week.
Construction of one of Germany's tallest buildings was recently halted after the developer stopped paying its builder.
Benko, an Austrian entrepreneur and a key figure in Europe's property market for two decades, is known for high-profile purchases including New York's iconic Chrysler Building and Britain's Selfridges.
Some current and former investors - themselves titans of industry - have in recent days publicly lashed out at Benko, raising questions about his future role at Signa.
"Given the current situation, this is the best solution for the company as well as its partners, investors and employees. What is important now is to restore trust, and I want to play my part in that," Benko said in the statement.
The Benko family will remain the largest shareholder, Signa said.
Geiwitz is best known for his role in the insolvency proceedings of Germany's Galeria Kaufhof-Karstadt department stores and drug store chain Schlecker.
"Signa needs calm and order at this time," Geiwitz said in a statement.
Signa said it had mandated consultants to help it conduct a "a thorough review of all business areas, developing measures and drawing up an integrated concept for the group".
Germany's regulator BaFin and the European Central Bank have been asking banks to detail their exposure to Signa, a person with knowledge of the matter said, confirming press reports.
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