Evergrande has been working on its Venice mega-project for a decade
Seizures of Evergrande projects lead our headline roundup again today as an FT report reveals that US-based debt investment specialist Oaktree has taken control of a second development from the troubled developer, following a story on a Hong Kong repo job a day earlier.
Also in the news, investors are fleeing Hopson Development as it switches auditors, the IMF warns of wider repercussion from China’s real estate skid, and Hang Lung Properties is hoping to pick up a few bargains.
Oaktree Seizes Evergrande’s Venice Project in China’s Jiangsu Province
Oaktree Capital has seized one of Evergrande’s most-prized assets in mainland China, a rare intrusion by a global investor in a domestic crisis caused by the biggest ever collapse of a property developer.
The move by the US distressed debt specialist — which now controls the sprawling “Venice” residential development in the Jiangsu provincial city of Qidong, on the Yellow Sea coast near Shanghai — is a first for an international investor affected by Evergrande’s spiralling $300 billion crisis. The Venice project defaulted on a secured loan provided by Oaktree late last year, according to two people with knowledge of the details. Read more>>
PWC Resigns as Hopson Auditor, EY on Deck
Guangdong-based Hopson Development Holdings, which just a few months ago was proposing to purchase Evergrande’s property management unit, may have joined the ranks of China’s troubled home builders after the Hong Kong-listed company’s auditors, PriceWaterhouseCoopers resigned late last week, according to a statement to the Hong Kong exchange.
The Thursday resignation, which many took as a sign of financial struggles at Hopson, was followed late Friday by the firm proposing Ernst Young as its new auditor, after shares in the developer closed on Friday down 21.1 percent for the week. Read more>>
IMF Warns of Systemic Risk From China’s Property Crisis
A funding crisis battering China’s big property developers could start to shake the wider economy and global markets, the IMF warned on Friday, saying deeper reforms were needed to fully curb the threat.
The International Monetary Fund’s report comes as property firms in the world’s second-biggest economy struggle with liquidity problems as Beijing looks to curb excessive debt and rampant consumer speculation in the sector. Read more>>
Hang Lung Looks for Opportunities to Buy Distressed Mainland Assets
Hong Kong property developer Hang Lung Properties Ltd. is looking to buy high-quality real estate from distressed peers in mainland China.
The company is interested in commercial property assets in tier one and tier two cities, Vice Chair Adriel Chan said in an interview with Bloomberg Television on Friday. Read more>>
CapitaLand’s CICT Set to Target Singapore Acquisitions
The manager of CapitaLand Integrated Commercial Trust on Friday (Jan 28) said its acquisition activities may potentially be “intensified” in FY2022, as the real estate investment trust sets its sights on adding to its Singapore properties.
“The next (acquisition) opportunity that we’re looking at is Singapore and we’re assessing it quite closely,” said chief executive officer of the Reit manager Tony Tan in a briefing following its results announcement. “Our priority this year will be Singapore.” Read more>>
Ascott REIT Aims to Boost Long-Term Rental Assets by Up to 30%
Seeing how strongly the demand for longer stay assets had held up across the pandemic, Ascott Residence Trust is now intent on growing this segment to 25 to 30 per cent of its total portfolio value in the next 3 to 5 years.
This strategy will help guard the hospitality real estate investment trust against future “black swan” events, Beh Siew Kim, chief executive officer of ART’s managers, said in a call with reporters and analysts to discuss the Reit’s financial results on Friday. Read more>>
China Announces New Tax Breaks for REITs
China will provide tax relief for new real estate investment trusts (REITs), the finance ministry and tax bureau said on Saturday, as part of a nationwide push to boost the nascent REITs market.
Corporate tax related to asset transfers will be exempted before the REITs are set up and can be deferred during the setup process, they said in a statement. Read more>>
Blackstone’s Embassy Office Parks to Develop Bengaluru Project
Embassy Office Parks REIT will invest Rs 850 crore to develop nearly two million square feet office buildings in Bengaluru as the company remains bullish on demand for premium workspace, a senior company official said. Embassy Office Parks REIT, the country’s first public listed real estate investment trust (REIT) sponsored by Blackstone and realty firm Embassy group, is also evaluating the acquisition of a five-million-square-feet IT park in Chennai.
In an interview with PTI, Embassy REIT Deputy CEO and Chief Operating Officer Vikaash Khdloya said, “We have started a new growth cycle by starting new development of 1.9 million square feet area in Embassy Tech Village in Bengaluru.” Read more>>
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