Korea’s KIC to Invest $150M in Apollo and More Asia Real Estate Headlines

Korea’s growing presence on the global investment stage leads today’s roundup of headlines from around the region, with the country’s sovereign fund buying into a US private equity player. Also in the news, Evergrande’s woes continue with a missed onshore bond payment and CapitaLand Ascott Trust wraps up its disposal of four French properties.

KIC to Invest $150M in Apollo Global Management

South Korea’s sovereign wealth fund, Korea Investment Corporation (KIC), is set to invest KRW 200 billion ($150 million) in Apollo Global Management, the world’s second-largest private equity firm (PEF). As global funds seek alternative markets for investments and fundraising due to restrictions in China, Korea is emerging as a focal point.

According to industry sources on Sunday, KIC will allocate KRW 200 billion ($150 million) to Apollo Global Management’s 10th buyout fund. The fund, with a total target size of $25 billion, has already raised over $13 billion, surpassing the halfway mark. KIC is also expected to invest more than KRW 50 billion ($37 million) in an upcoming Apollo co-investment fund. Read more>>

China Evergrande Fails to Repay $547M Onshore Bond

The mainland unit of China Evergrande Group said it missed principal and interest payments totaling several billion yuan, adding further uncertainty to the fate of the giant developer at the centre of the country’s property crisis.

Hengda Real Estate Group, flagship unit of Evergrande, failed to repay RMB 4 billion ($547 million) in principal plus interest due on Monday (Sep 25), the company said in a Shenzhen stock exchange filing. Read more>>

CapitaLand Ascott Trust Completes $47M Sale of French Properties

CapitaLand Ascott Trust sold four mature serviced residences in regional France for a total of 44.4 million euros ($47 million) as part of its portfolio reconstitution strategy, its manager said on Monday (Sep 25).

The divestment was made 63 percent higher than the book value dated the end of 2022, and its net proceeds were about 34.1 million euros ($36.1 million). Based on FY2022’s earnings before interest, taxes, depreciation and amortisation (Ebitda), the exit yield was approximately 4 percent. Read more>>

Evergrande Debt Setback, Oceanwide Blow Rattle China Property Stocks

Another obstacle to embattled developer China Evergrande Group’s long-pending debt restructuring plan rekindled fears for China’s crisis-hit property sector on Monday, sparking a stock sell-off.

Developer China Oceanwide Holdings added to investor concerns in an exchange filing which said that a Bermuda court had ordered its winding up and appointed joint provisional liquidators. Read more>>

Teetering China Property Giants Undercut Xi’s Push to End Crisis

Fresh drama at property developers including China Evergrande Group is jeopardizing President Xi Jinping’s latest efforts to end the housing crisis.

Just as China enters a key holiday sales season, a raft of headlines are weighing on already-frail confidence in the property market. Evergrande said it has to revisit its debt restructuring plan and a unit missed a yuan bond payment. Former executives at the defaulted real estate giant have been detained, Caixin reported. Meanwhile, China Oceanwide Holdings Ltd. said it is facing liquidation and Country Garden Holdings Co. is still trying to avoid a potential default. Read more>>

Climate Change Poses Risk to Singapore Hotel Success

In July, the average room rate (ARR) and revenue per available room (RevPAR) of hotels here rose by 12.8 percent and 28.3 percent year on year (yoy) respectively, based on the Singapore Tourism Board’s data. Versus pre-pandemic levels in July 2019, ARR and RevPAR in July 2023 jumped 32.8 percent and 27.2 percent, respectively.

In the luxury segment, the ARR in July 2023 was S$598.6 ($437.5), versus S$530.8 ($387.9) in July 2022 and S$452.30 ($330.6) in July 2019. Read more>>

Self-Storage Player Storhub Gets $180M Green Loan from CIMB, UOB

StorHub Self Storage Group (StorHub) has secured a $180 million sustainability-linked loan (SLL) from CIMB and United Overseas Bank (UOB).

The loan features a sustainability-linked margin adjustment, tied to two Key Performance Indicators (KPIs) of the environmental performance of StorHub’s 13 properties in Singapore, says the company on Sept 25. Read more>>

Indian Govt Considering $7.2B Mortgage Subsidy Scheme

India is considering spending INR 600 billion ($7.2 billion) to provide subsidised loans for small urban housing over the next five years, two government sources told Reuters.

Banks are likely to roll out the scheme in a couple of months, ahead of key state elections later this year and general elections due in mid-2024. Last month, the South Asian country cut cooking gas prices for households by about 18 percent to rein in inflation ahead of elections. Read more>>

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