China’s CBIRC is getting a bit nervous about bank exposure to the property market
China’s growing anxiety over its shaky real estate market leads our headline roundup today, with news emerging that the country’s main financial regulator is sifting through bank loan portfolios for risks. Also in the news, Hong Kong’s economic doldrums spell trouble for an upcoming tender of a commercial site and a mainland venture capitalist is said to have picked up a Singapore shophouse.
China Regulator Probes Bank Property Loan Portfolios
China’s banking regulator is scrutinising property sector loan portfolios of some local and foreign lenders to assess systemic risks, sources with knowledge of the matter said, as the real estate sector’s debt crisis worsens.
As part of their assessment, the China Banking and Insurance Regulatory Commission (CBIRC) is looking at banks’ loan book exposure to developers to find out if those credit decisions were made according to the rules, one of the sources said. Read more>>
Hong Kong URA Tender Likely To Draw Muted Response
The upcoming tender for the last phase of Kwun Tong town centre’s mega redevelopment will test the market’s resilience amid a weakening economy and high office vacancy rates in the area, market observers say.
The Kwun Tong Town Centre Project, which aims to turn the old district into a “small Taikoo Shing”, is the Urban Renewal Authority’s largest redevelopment project to date. The entire project occupies a site area of more than 500,000 sq ft spread over five plots and has been undertaken in phases since 2007. Taikoo Shing is Swire Group’s development in Quarry Bay, which includes flats, offices, a hotel and shopping centre. Read more>>
Chinese VC to Buy Singapore Shophouse for $16.7M
A co-founder of Chinese venture capital firm Shunwei Capital is understood to be in the early stages of buying the Bali Lane shophouse property where popular watering hole and live-entertainment venue Blu Jaz Cafe operates.
Koh Tuck Lye, also known as Xu Dalai, has been granted an option to buy 11 Bali Lane, for S$23 million ($16.7 million). The 999-year leasehold, 3-storey property in the Kampong Glam Conservation Area stands on a 1,664 sq ft corner site. It is owned by a South Korean party that paid S$18.8 million for it in late 2019. At the time, the total built-up area was reported… Read more>>
New Flats at SHKP’s Novo Land In Tuen Mun Sell Out
The low-pricing strategy of Hong Kong developers proved effective once again as hundreds of mainly young first-time buyers flocked to the sales office of a large residential project in Tuen Mun.
Sun Hung Kai Properties (SHKP) sold all 180 units on offer in the second phase of its Novo Land project within the first four hours on Wednesday afternoon, according to agents. Read more>>
China’s First Publicly Traded Rental Property REITs Snapped Up
CHINA’S first batch of publicly traded rental property real estate investment trusts (Reits) was snapped up in Shanghai and Shenzhen by yield-hungry investors this week, opening up a new financing channel for the struggling real estate sector.
The 3 newly launched Reits, based on affordable rental properties, were each more than 100 times oversubscribed among institutional investors, managers said in filings. The Reits will raise a combined RMB 3.8 billion ($560 million), based on Reuters’ calculations, and the subscription periods ended early. Read more>>
Chinese Property Developers’ Cashflow Has Plunged More Than 20 percent
Chinese property developers’ cash flows — a sign of the companies’ ability to stay afloat — shrank this year after steady growth over the last decade, according to Oxford Economics.
Developer cash flows through July are down 24 percent year-on-year on an annualized basis, according to analysis from the firm’s lead economist, Tommy Wu. Read more>>
State Intervention Seen Favouring Only Select Few Chinese Developers
China’s housing crisis has already chewed through the country’s more notorious developers, particularly Evergrande—which has defaulted on multiple bonds and is struggling to finish apartments for buyers who have already paid.
But the sales crisis now risks dragging down the good boys of the industry, too. The stocks and bonds of Chinese property developers rallied Tuesday following media reports that the government will guarantee new bond issues from some healthier private developers. Shares of the companies mentioned jumped: Longfor 12 percent and Country Garden 9 percent. Read more>>
Real Estate Brokers Bat for Uniform Licence Across India
The National Association of Realtors (NAR) India, a real estate organisation that represents more than 50,000 property brokers nationwide, has pleaded with the federal government to provide brokers with a single licence that would enable them to operate everywhere in the country, regardless of the state in which they reside.
Chetan Chopra, Director of North Zone told Moneycontrol, “We want one nation and one licence. For example, today from Punjab if I want to do business in Maharashtra, we have to take Maha Real Estate Regulatory Authority (RERA) number, which adds costs to the business.” Read more>>
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