Sunac’s Sun Hongbin now looks askance at branching into new industries
Developer half-year financial results continue to dominate the headlines today, as both Sunac China and Hong Kong’s Sino Land report in with big jumps in profit driven by strong sales in the first six months of 2018. Down in Singapore market conditions may start to make profits harder to come by as the government suddenly boosted development charges, which could mean a speedy sunset to the city’s collective sale boom. The details on all these stories and more await you below.
Sunac Quits Diversification After LeShi Disaster
Property developer Sunac China said it will focus on its core business and stop non-property related diversification plans, following its failed investment in debt-laden Leshi Internet Information & Technology Corp Beijing.
Sunac, widely viewed as a white knight after its 15 billion yuan ($2.20 billion) investment for the crumbling LeEco group of which Leshi has been the main listed vehicle, booked a 16.6 billion yuan charge last year for the investment. Read more>>
Singapore Hits Builders With 9.8% Hike in Development Charge Rates
The development charge (DC) rates for redeveloping land have gone up for commercial and industrial sites, as well as plots slated for non-landed private homes, and hotels and hospitals.
Land zoned for non-landed residential use saw an average increase of 9.8 per cent, the Ministry of National Development (MND) said on Friday (Aug 31) – down sharply from the 22.8 per cent hike in March. Read more>>
Sino Land Reports 99.9% Jump in Net Profit
Hong Kong developer Sino Land said on Thursday its underlying net profit for the first half of 2018 had nearly doubled to HK$11 billion (US$1.4 billion), boosted by the disposal of a property in Chengdu, even as property sales revenue declined.
The company’s underlying net profit to shareholders, excluding the fair value change of its investment properties, and a gain on a 20 per cent interest retained in the Chengdu project, rose by 99.9 per cent year on year. Excluding the one-off gain, its underlying profit was HK$5.4 billion. The company recommended a final dividend of 40 Hong Kong cents per share. Read more>>
Moody’s Sees Onshore Bond Sales Boosting Liquidity for Mainland Developers
Moody’s Investors Service says that onshore liquidity conditions have improved for property developers in China, and their onshore bond issuance will increase.
“Onshore bond issuance totaled RMB16.7 billion in August 2018 and RMB25.1 billion in July 2018, up from RMB11.1 billion in June this year, indicating that rated Chinese developers have better access to the onshore bond market for refinancing,” says Cedric Lai, a Moody’s Assistant Vice President and Analyst. Read more>>
Evergrande Declares 26% Discount for Golden Week
Evergrande Group, China’s second-largest property developer, has recently launched a nationwide large-scale promotion, by offering a 26% discount on its residential housing in the name of the incoming Golden Week holiday, The Paper reported.
According to the promotion policy, if all the purchase discounts are used together, the final discount on a residential property could reach 26%. Read more>>
Swire Pulls Back From Apartment Sale as Market Slows
Hong Kong developer Swire Properties withdrew a luxury serviced apartment development in Quarry Bay from the market on Thursday amid souring sentiment.
The developer said it had reviewed plans for Taikoo Place Apartments, which comprises 111 units ranging from 340 sq ft to 1,140 sq ft in area, and had decided to continue holding the property as a long-term investment. Read more>>
HNA Cuts Debt by $11.6B in 2018 1H
China’s HNA Group HNAIRC.UL reduced its debt load in the first half of 2018 as the company sold off assets acquired under a high-profile acquisition spree helmed by its former chairman, according to the company’s latest financial report.
HNA Group’s total debt stood at 657.41 billion yuan ($96.25 billion) at the end of the first half, down 10.7 percent or $11.6 billion from the end of 2017. Read more>>
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Markets seem to be on very thin ice.