White. I am currently in London and work in the property...

White. I am currently in London and work in the property industry.

I will speculate that the banks will not foreclose on VPG. Why you ask?

At this point VPG has moderate gearing assuming writedowns. Also the ICR is well above 1.

There are RE funds/companies across the UK and EU that have LTV's of 60/70/80/110% and at this point there has been little to no forced selling by banks.

My view is that there are a couple of reasons for this.
1.Banks are so heavily into commercial property finance that they cant afford to push values down further by conducting sales. Valuers at the moment are having an educated guess as to pricing, as there are no transations.
One spate of "fire selling" by any one of the banks will cause further huge problems across the whole banking sector.
2.Where funds/companies have good ICR (even in some instances where they dont), banks are reluctant to do things other than charge significantly increased margins.

Until we see VPG breaching 70% LTV I think most banks will be quite comfortable. Especially if they see VPG paying down debt in an orderly fashion through the sale of some assets, as we have seen through the second half of last year)