Turmoil in mainland China’s property sector leads the real estate news from around the region again today as the country’s biggest developer gets more time to pay debts and two of the world’s largest credit agencies withdraw ratings on seven Chinese developers in one week. Also in the headlines, Blackstone-backed data centre operator VNET appoints advisors to evaluate a buyout offer and Thailand’s CP Group drops out of the bidding for Metro’s India business.
Bondholders of Chinese property developer Hengda Real Estate agreed to an extension of interest payment on one domestic bond by six months to April 19, 2023, according to a Shenzhen stock exchange filing on Friday.
Hengda, China Evergrande Group’s flagship onshore business, held a meeting with bondholders between Oct. 13 and Oct. 14 to discuss the latest repayment arrangement. Read more>>
Fitch Ratings and Moody’s Investors Service have withdrawn ratings on at least seven builders this week. They include CIFI Holdings Group Co. and Seazen Group Ltd., both of which were part of a select group of developers to recently sell debt with state guarantees. Others with withdrawn ratings include defaulted developers China Evergrande Group and Kaisa Group Holdings Ltd.
The slew of ratings exits come as CIFI’s default this week raised questions about Beijing’s ability to contain the liquidity squeeze among developers it has intended to better support. The moves are also set to make investors’ decisions even more difficult given the already-murky pictures of some Chinese builders’ finances. Read more>>
Chinese real estate developers are delaying their debt restructuring moves until after the upcoming Communist Party Congress, hoping the crucial gathering offers clues on how Beijing plans to stabilise the embattled sector.
What emerges at the meeting could help determine how the developers, who have missed payments or even defaulted on their offshore bonds worth tens of billions of dollars, pace any asset sales, extract or offer concessions to creditors, or even put themselves up for liquidation. Read more>>
Nasdaq-listed VNET Group said on 14 October that a special committee of its board has retained Kroll Securities and Kroll LLC as its independent financial advisor and Davis Polk & Wardell as independent legal counsel to evaluate a buyout offer for the data centre operator.
In September a group led by Josh Sheng Chen had made a preliminary offer to buy the outstanding shares in the Blackstone-backed China data centre operator. Read more>>
Reliance Industries Ltd. is in advanced discussions to acquire German firm Metro AG’s wholesale operations in India, according to people familiar with the matter, as the conglomerate led by billionaire Mukesh Ambani seeks to dominate India’s mammoth retail sector.
Charoen Pokphand Group Co. is no longer actively in talks with Metro, leaving only Ambani’s Reliance to pursue the so-called cash-and-carry business, the people said, asking not to be identified as the information is private. A final decision could emerge as early as next month, one of the people said. Read more>>
UBS Group AG’s Asia-Pacific investment bank head, David Chin, has resigned to step away from banking five years after he was brought back to help bolster the Swiss lender’s China business.
Chin, 54, will be replaced by Taichi Takahashi, the region’s head of global markets, people familiar with the matter said, asking not to be identified before it’s announced internally. Chin will leave the bank by the end of this month, the people said. A Hong Kong-based spokesman declined to comment. Read more>>
Private equity investment inflows into the Indian real estate sector stood at USD 322 million (Rs 26 billion) according to the latest report by Savills India, a global property consulting firm.
As many deals are taking longer timelines, Q4 2022 and Q1 2023 should see large announcements on the deals under closure. Read more>>
Hong Kong’s biggest developers surged in the biggest stock market rally in more than a week, on growing speculation the city will roll back market-cooling measures during a policy address later this month to support the industry.
Shares of Sun Hung Kai Properties, the biggest by market capitalisation, jumped as much as 6.5 per cent, before closing 0.7 per cent higher at HK$91.25 on Friday. Henderson Land Development rose 0.7 per cent to HK$21.90. The Hang Seng Properties sub-index rose 0.7 per cent, paring about half of its earlier advance. Read more>>