R&F Short of Funds for $300M Buyback and More Asia Real Estate Headlines

In today’s roundup of regional news headlines, China’s R&F Properties comes up short of funds for a planned bond buyback, fellow mainland developer Shimao reportedly defaults on a trust product of its own, and Amazon’s arbitration process against Future Retail is halted as the litigants’ case winds its way through the Indian courts.

R&F Says It’s Short of Funds for $300M Bond Buyback

Chinese developer Guangzhou R&F Properties said today it does not have sufficient funds to buy back a $725 million bond, as sales of its assets had not come through as planned.

The group said in a filing late Wednesday that the funds available to settle its tender offer for the offshore bond were materially less than the $300 million it previously expected, due to continued volatility in the property sector. Read more>>

Shimao Defaults on Trust Loan, R&F Bonds Sink

China Credit Trust said a unit of developer Shimao Group Holdings defaulted on a trust product with RMB 645 million ($101 million) of overdue payment, according to a notice sent to investors seen by Bloomberg.

China Credit Trust demanded early repayment on the product after the developer failed to meet instalment requirements, according to the notice. Shimao dollar bonds fell at least 10 cents on the dollar, according to data compiled by Bloomberg. Read more>>

Indian Court Halts Amazon Arbitration Case Against Future Retail

An Indian court has ordered a halt on Amazon’s arbitration case against Future Retail in Singapore, a day after it had refused to interfere with the process.

Following an appeal by Future Retail, a two-judge panel of the Delhi high court overturned Tuesday’s verdict and stayed the arbitration process started by Amazon to stop the cash-strapped Indian retailer’s asset sale to Reliance Industries until the next hearing on 1 February. After a December antitrust ruling against Amazon, the case appears to be in favour of Future Retail, the bench said. Read more>>

Brookfield in Line to Win Mumbai Office Complex

Brookfield Asset Management has emerged as the front-runner to acquire the IL&FS group’s headquarters in Mumbai’s Bandra Kurla Complex. While a few others, including private equity firms and real estate companies, had shown interest, none of them matched the bid by Brookfield.

The IL&FS board put the group’s corporate headquarters on the block as part of the resolution process to address a INR 99,000 crore ($13.3 billion) debt pile. Finished in 2005, the 11-storey building was one of the earliest to come up in the business district. Read more>>

China May Delay Property Tax Amid Housing Price Slump 

China’s property tax could be another casualty of the slump in the housing market, with analysts expecting the government to hold off on expanding trials of the levy because of a real-estate-led economic slowdown.

Last October, China’s parliament authorised the limited property tax in Shanghai and Chongqing to be expanded to more cities, with some analysts forecasting that it could begin by the end of 2021. But the rapid deterioration of the real estate sector and a lack of any detailed implementation plan from the State Council is fanning speculation that the government is waiting for a market uptick before it starts the tax. Read more>>

Evergrande’s Four Most Over-the-Top Projects

China Evergrande is lurching from one crisis to another. From its home delivery snag to ongoing debt repayment troubles, more than $52 billion in market value has been erased from the slump in its two flagship entities in Hong Kong over the past 12 months.

The group’s RMB 1.97 trillion ($309 billion) in liabilities make it the nation’s most indebted developer. Chinese government officials have pinned the blame squarely on Evergrande’s “poor management” and “reckless expansion” into an array of unrelated sectors and other pet projects. Read more>>

Singapore HDB Flat Sells for Record Price of S$1.36M

The number of Housing Board (HDB) resale flats transacted for at least S$1 million ($730,000) continued to rise in December to 38, surpassing the 29 transactions recorded in November — the previous record high.

A five-room DBSS HDB unit located at Bishan’s Natura Loft fetched the highest price in December at S$1.36 million — the highest transacted price ever for a resale flat. Read more>>

Tune in again soon for more real estate news and be sure to follow @Mingtiandi on Twitter, or bookmark Mingtiandi’s LinkedIn page for headlines as they happen.