Following up on our recently posted story (“Another Idiotic Brazilian Hedge Fund Goes Bust“), here is part II. To cover up his astronomic stock market losses, Mu Hak You, the hedge fund manager, decided to liquidate his real estate investments. Interestingly, he will have to sell his BR$600M in real estate assets to pay his debts with the bank. Exame magazine writes (through Google Translate):
“GWI Asset Management distinguished itself in recent years by managing the most aggressive funds in the Brazilian market. The portfolios managed by Mu Hak You (the hedge fund manager), quite popular among the South Korean community of Bom Retiro (a central district of São Paulo), went bankrupt twice, once in 2008 and another in 2011. Last month, the GWI funds came to stay with a negative net worth and it remains in default – thus unable to operate. Almost in parallel to the “kamikaze” strategy it adopted in the stock market, the fund operate a real estate arm, which is well-managed and profitable – very likely it has become a lifeline to GWI at this time of extreme difficulty. Market analysts and experts say the GWI Real Estate has begun to organize a process of liquidation of all its property (estimated in BR$600M)”
Well, considering that the brazilian real estate market started a process of
deflation “slow down”, we are looking forward to hearing if the sale will materialize at these price levels.