A Nanjing apartment operated by rental housing platform Ziroom
Leading today’s roundup, China’s drive to promote rental housing comes with risks for the country’s big lenders, which are estimated to have extended nearly half a trillion dollars in financing to the sector. Also in the headlines, Indian developer ABIL Group has revealed plans to convert a London commercial building into a five-star hotel, following its acquisition of the property from a Blackstone fund in April. And Singaporean developer CapitaLand’s VC arm is betting on a startup that serves up big data to retailers and brands.
Chinese State Banks Extend Risky Loans to Renters
As property prices rocket across China, Beijing has appealed to the country’s banks and insurers to help accelerate the development of rental markets as a way of making homes more affordable – and rein in speculative sale markets.
The big state banks have responded by pledging more than RMB 3 trillion ($467 billion) in rental housing financing, including for real estate developers, leasing firms and tenants, according to Reuters calculations. The total value of the rental market was RMB 1.3 trillion last year. China Construction Bank Corp, the second-largest lender, is the most visible example of this trend, giving loans to renters at ultra-low interest rates with long repayment periods. Read more>>
India’s ABIL Confirms $134M London Office Buy from Blackstone
In a closely contested auction, Pune, India-based realty developer ABIL Group has acquired an eight-storey commercial building at Trafalgar Square in London for nearly £100 million ($134 million) from American global investment management corporation BlackRock. The deal value includes stamp duty of 5 percent and other charges that have been paid as the registration has been concluded.
The freehold property, 5 Strand Trafalgar Square that counts Westminster Council as a key tenant, witnessed interest from over 22 global entities including developers and investors from China, Europe and India. New York-headquartered BlackRock, the erstwhile owner of the property, had set the reserve price of £80 million for this iconic building. ABIL Group is planning to redevelop the property into a five-star hotel with 210 to 230 keys inventory with an additional investment of over £80 million, an executive said. Read more>>
CapitaLand Backs $1.7M Funding Round for Retail Data Startup
C31 Ventures, the venture capital arm of Singaporean mall operator CapitaLand, has joined Singapore and Silicon Valley VC firm Wavemaker Partners in leading a $1.7-million seed funding round for retail data analytics startup Omnistream.
Olga Lyudovyk, a former executive at retail brands including Zara and Marks & Spencer, and an unnamed Hong Kong investor, also participated in the seed round for the Singapore-based startup that provides data analytics services to retailers and brands. C31 Ventures’ investment was made under the third instalment of the National Research Foundation Singapore’s (NRF) Early Stage Venture Fund, which is an initiative of the Singapore government aimed at supporting local tech startups. Read more>>
Mainland Property Firms Scramble to Issue Overseas Bonds
Chinese companies have been increasing efforts to raise funds by issuing bonds overseas, which experts said is an effective way to reduce their short-term debt ratio at a time when domestic financing channels are becoming restricted.
Data revealed in a Xinhua News Agency report in January showed that by the end of 2017, the US dollar-denominated debt issued by Chinese enterprises in overseas markets increased by 70 percent year-on-year to approximately $180 billion, a record high. Real estate companies have been particularly active in this area. According to a report by chinanews.com, mainland real estate companies had issued 61 batches of bonds overseas from January 1 to May 22, worth a total of more than $24 billion, up 105 percent on a yearly basis. Read more>>
WeWork Gears up for Southeast Asia Growth
Office-sharing start-up WeWork is looking to expand within Southeast Asia. The New York-based company, known for spacious buildings consisting of private offices and desks that it rents to freelancers, first entered the regional market last December with a Singapore branch. Since then, it’s opened seven more locations in the city-state in addition to three sites in the Indonesian capital of Jakarta.
More buildings are in the pipeline for Singapore, with Bangkok up next, WeWork Managing Director of Southeast Asia Turochas “T” Fuad told CNBC’s Dan Murphy on Wednesday. Buildings in Manila and Kuala Lumpur could follow, he said. Speaking with CNBC at technology conference InnovFest Unbound, Fuad attributed the firm’s ambitious plans to strong Southeast Asian demand. Read more>>
Shanghai’s Qiantan Zone Strives to Rival Manhattan
Twelve kilometres south of Shanghai’s financial hub of Lujiazui, workers are putting the finishing touches to a glitzy-looking office tower designed to resemble a crystal which dominates the skyline.
The futuristic-looking edifice designed by American developer Tishman Speyer is part of a grand plan known as “the second Lujiazui”, reflecting its planners’ ambitions to rival Manhattan and London Called Qiantan, gleaming new area is aimed at appealing to multinational and financial firms, especially, looking for an alternative far costlier and crowded Lujiazui. Of the 1.65 million square metres of new office space planned in Pudong over the next five years, more than half is earmarked for Qiantan, according to Colliers International. Read more>>
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