Fantasia boss Baby Zeng Jie has hired Houlihan Lokey to advise on restructuring
In today’s roundup of regional news headlines, China’s beleaguered developers take centre stage as Fantasia limits trading in its Shanghai bonds, Modern Land requests a payment extension on its own debt, and Evergrande’s silent treatment of offshore creditors risks a legal fight.
Fantasia Limits Bond Trading After Hiring Restructuring Advisors
Cash-strapped Chinese property developer Fantasia Holdings’ unit limited trading in its Shanghai bonds on Monday, a move seen to be aimed at curbing volatility often ahead of defaults, following a credit downgrade.
Modern Land China Co, a smaller developer, said it was seeking consent from investors to extend the maturity date of a dollar bond due on 25 October by three months in order to avoid a default. Read more>>
Modern Land Asks for Payment Extension as Credit Crunch Spreads
Property developer Modern Land China on Monday asked its debt holders for a three-month extension on a $250 million bond set to come due later this month to avoid a potential default, as concerns continue to swirl around the embattled China Evergrande Group and the Chinese property sector’s debt levels.
The Beijing-based builder said it was seeking bondholder approval to extend the maturity of its 12.85 percent senior notes from 25 October to 25 January and to repay $87.5 million of the principal amount. Read more>>
Evergrande Bid to Sell Yuen Long Plot Draws Little Interest
Few buyers are likely to step forward to buy China Evergrande Group’s plot in the northern New Territories, which falls under the planned Northern Metropolis, because of the high land cost and lack of a detailed blueprint for the megaproject, industry observers say.
Last Wednesday, Chief Executive Carrie Lam proposed a new hub covering an area of 300 square kilometres (116 square miles), with an innovation and technology corridor serving as its engine. Once the entire Northern Metropolis is fully developed, including the Yuen Long and North districts bordering the mainland, it will be home to 2.5 million people in 20 years, she said. Read more>>
Evergrande Keeps Offshore Bondholders Guessing as Default Looms
A group of China Evergrande Group’s offshore bondholders said that the property developer had not engaged with them since missing interest payments on two dollar-denominated bonds in September and that they were concerned about potential asset flows to other creditors.
The first public comments from offshore bondholders about the missed payments came as property agency Centaline Group separately filed two lawsuits, claiming it was owed more than HK$100 million ($12.8 million) in unpaid commissions from flat sales at two Evergrande projects in Hong Kong. Read more>>
Evergrande Offshore Bondholders Lawyer Up for a Fight
Kirkland & Ellis and Moelis & Co are working on contingency plans with offshore holders of China Evergrande Group’s bonds who fear that the struggling company may sell assets that they’re counting on to back up their claims if the business collapses.
The law firm and the New York-based investment bank are advising a group that so far includes six members holding $2.5 billion worth of Evergrande offshore bonds, a Moelis managing director said on a call with bondholders Friday. They’ve been trying to engage with Evergrande and its advisors since 16 September, sending letters asking for information about the company’s situation and assurances that management won’t sell offshore assets while a solution is being discussed. Read more>>
How Evergrande’s Rags-to-Riches Founder Is Trying to Save His Empire
Four years after vying with Jack Ma for the title of Asia’s richest man, Evergrande chairman Xu Jiayin’s fortune is plunging and his sprawling real estate empire is on the verge of collapse.
It’s a stunning reversal for a man who fought his way from poverty in rural China to build one of the world’s largest property companies. In previous times of trouble, Xu had been able to rely on the help of his tycoon friends and local government support. This time, with $305 billion in liabilities and the company’s asset prices plunging, Xu appears more alone than ever. Read more>>
Sheung Shui Flats Snapped Up Amid Northern Metropolis Heat
Tai Hung Fai Enterprise’s Sheung Shui low-priced residential project Artique sold out in 90 minutes flat yesterday, amid speculation over the government’s Northern Metropolis development plan.
The 30-home project is considered to have the smallest floor plan available in the North district, with prices as low as parking spaces in private housing estates. Read more>>
Tune in again soon for more real estate news and be sure to follow @Mingtiandi on Twitter, or bookmark Mingtiandi’s LinkedIn page for headlines as they happen.
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