Martinsa-Fadesa Group, one of Spain's largest developers in both the commercial and residential sectors, is declaring itself insolvent having failed to raise a 150 million euro (Dh873.59m) loan as part of a massive four billion euro refinancing package.
Another major group, Colonial, has also been in trouble for most of this year so far after declaring itself more than 8.9bn euros in debt at the end of 2007.
Spain's residential sales market has shrunk by 39 per cent over the past year (and remember – a year ago it was 25 per cent down on the year before that). Sales by residence developers are down 60 per cent, and 140,000 workers across the construction industry have been laid off.
To make a bad scene even worse, new government figures from Madrid show that since summer 2002 an average of some 600,000 homes a year have been built in Spain – and some 150,000 a year have been sold. Tens of thousands of estate agents' offices now lie empty in shopping centres across the country.
Spain now rivals the US for producing the most spectacular property market horror stories, and for attracting vulture buyers ready to snap up properties at bargain-basement prices.
The Investment Corporation of Dubai is known to be looking at the Spanish distress-sales market. An Oman bank is said to be investigating investment opportunities. A Russian oligarch is considering buying a developer.
Rumour or truth? Time will tell, but one thing is certain – Spain's property industry, which was one of the most inward-looking until recently, is about to become a multi-national operation.