Kaisa Group chairman Kwok Ying Shing (Getty Images)
Defaulted developer Kaisa Group leads today’s headline roundup as the Shenzhen-based firm hammers out a deal with a group of bondholders. Also making the cut, Hong Kong homebuyers are increasingly forfeiting their deposits and Bank of China is switching auditors.
Kaisa Says Bondholder Group Agrees to Restructuring Plan
Chinese property firm Kaisa Group on Tuesday announced an offshore debt restructuring agreement with a key group of bondholders, swapping existing debt into new notes and shares in the company.
The Shenzhen-based developer has been working to restructure its offshore debt since defaulting on $12 billion in offshore bonds in late 2021. The restructuring plan also covers other debts including loans and yuan-denominated asset-backed securities. Read more>>
More Hong Kong Homebuyers Forfeiting Deposits as Prices Drop
The number of new-home buyers who have forfeited their deposits has jumped by nearly a fifth in the first half compared with the whole of last year amid a persistent slump in property prices, according to Centaline Properties Research.
There were 149 forfeitures in the second quarter, compared with 159 in the first three months of the year, the Centaline data showed. The 308 forfeitures in the year’s first six months have already exceeded the 261 cases for 2023. Read more>>
Bank of China Dumps PwC as Auditor
Auditor PwC has lost its largest mainland China-listed client, Bank of China, to rival EY, adding to an exodus of clientele amid a regulatory investigation into its work on troubled developer China Evergrande.
State-owned Bank of China had as recently as March stated plans to reappoint PwC as its auditor for 2024 but in a Monday filing said it plans to appoint EY. The decision will be submitted for shareholder approval, it said. Read more>>
China Home Prices Drop as Cities Stop Limiting Discounts
A price war is spreading across China’s new-home market, as local governments dial back on intervention and developers race to recoup cash.
In Beijing, a sudden 18 percent price cut in May at a mid-sized residential project on the city’s outskirts has forced adjacent new developments to follow suit, according to people familiar with the situation who asked not to be named discussing a private matter. Near the southern border, the Shenzhen government approved a 29 percent cut in unit prices for a complex compared with a year ago, according to other people. Read more>>
Singapore Moves to Rein In Public Housing Prices
Singapore introduced new curbs on public housing as Prime Minister Lawrence Wong seeks to tame price gains that threaten to become a political flashpoint in upcoming elections.
The measures, which include a lower loan-to-value limit on financing from the public housing authority, are aimed at promoting a “stable and sustainable” market, according to a joint statement late Monday from the Ministry of National Development and the Housing & Development Board. Read more>>
Mainland Court Accepts Liquidation Hearing Against Evergrande
A mainland Chinese court accepted a liquidation application filed against a China Evergrande unit earlier this month, triggering a formal legal process that ratchets up the pressure on the defaulted developer to either restructure or face liquidation in its main base of operations under a worst-case scenario.
The Intermediate People’s Court of Guangzhou, where Evergrande is based, accepted the application filed against Guangzhou Kailong Real Estate as of 9 August, according to a Hong Kong stock filing late Monday. Kailong, fully owned by Evergrande, has a stake of around 60 percent in Hengda Real Estate, the developer’s main onshore property operation, a separate exchange filing showed. Read more>>
Tokyo Metro Could Fetch $4.7B Value in IPO
Japan’s national and Tokyo governments are seeking a JPY 700 billion ($4.7 billion) valuation for Tokyo Metro as they prepare to list the subway operator as early as the end of October, three sources said, in what would be the nation’s biggest IPO in roughly six years.
The two governments, which own 100 percent of Tokyo Metro, plan to arrange a meeting of brokerages within a week for a briefing on the IPO and expect to receive approval for the listing from the Tokyo Stock Exchange as soon as mid-September, the sources said. Read more>>
Chinese Developers Slash Land Acquisitions
Rated Chinese developers have limited their land replenishment further amid weaker new-home sales and larger price declines, though their focus on stronger cities persists, says Fitch Ratings.
Eight rated developers with publicly available data had a median ratio of land acquisitions to contracted sales of 8 percent in the first half of 2024, dropping from mid- to high-teen levels in 2023. Their retreat in land banking was partly filled by the aggressive bidding of some unrated developers, which may indicate that some local government-backed entities are supporting local land markets. Read more>>
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