INMOBILIARIA Colonial SA, the Spanish property developer that's lost more than three quarters of its market value this year, reported a loss of 2.38 billion euros (US$3.47 billion) for the first half as the value of its assets plummeted.

The net loss compared with a profit of 316 million euros a year earlier, the Barcelona-based company said in a regulatory statement late yesterday. Ignacio Carvajal Cebrian, an analyst at UBS AG in Madrid, had estimated that the loss would be 250 million euros.

Spain's decade-long real estate boom ended last year after property purchases around the world became harder and more expensive to finance, denting developers' sales and pushing down prices.

That prompted Colonial to write down the value of assets including a 15-percent stake in Fomento de Construcciones y Contratas SA, a construction company, according to Bloomberg News.

"The rest of the writedown mainly corresponds to negative property valuations and the adjustments registered between the market value and the book value of the company's assets," Colonial said in the statement.

Colonial rose 5.3 percent yesterday. The shares have dropped 78 percent this year, making it the third-worst performer on the Madrid Stock Exchange General Index.