Sunac chairman Sun Hongbin is playing for time again (Source: Getty Images)
In today’s roundup of regional news headlines, Sunac China is reportedly in talks about a rare second extension on part of an onshore bond payment, as mainland developers prepare to sit down with financial institutions next month to discuss liquidity issues. In Hong Kong, meanwhile, developers at the city’s largest residential enclave are cutting prices to drum up sales.
Sunac Seeks Second Extension on Onshore Bond Payment
Cash-strapped developer Sunac China is talking to investors about a second extension on part of an onshore bond payment due at the end of this month, two people with knowledge of the matter said Wednesday.
It’s rare that a firm seeks to extend a payment again within a short period, highlighting the stressed liquidity of one of the country’s biggest developers by sales. The RMB 400 million ($59.6 million) payment due on 30 June is the first of six instalments of a RMB 4 billion puttable bond that Sunac had extended by 18 months from 1 April. Read more>>
Moody’s Downgrades Country Garden to Junk
Moody’s Investors Service lowered Country Garden Holdings from investment-grade territory, the latest sign of how sentiment has soured for private-sector Chinese developers during the industry’s cash crunch and sales slump.
The country’s largest builder by sales was downgraded one notch to Ba1, and Moody’s ratings outlook is negative. The company on Wednesday (June 22) cited Country Garden’s “declining property sales and deteriorating financial metrics”, as well as weakened access to long-term funding. Read more>>
Singapore’s GIC Said to Abandon Bid for Melbourne’s Southern Cross Towers
Singaporean sovereign wealth fund GIC is understood to have abandoned plans to buy the Southern Cross Towers complex in Melbourne after the private equity owners refused to drop the price by A$200 million ($138 million).
GIC had been moving to acquire the two-tower skyscraper complex on Exhibition St in Melbourne’s central business district after reaching a deal with owners Brookfield and Blackstone. Read more>>
Mainland Developers to Meet Financial Institutions for Liquidity Talks
Developers on the mainland are to meet with financial institutions next month to address the industry’s liquidity issues.
The conference will take place in Hangzhou on 26 and 27 July, with key discussions on financing programmes for embattled developers. There will also be a special session for enterprises interested in mergers and acquisitions or strategic cooperation. Read more>>
Hongkongers Spoiled for Choice in Lohas Park as Developers Cut Prices
In Lohas Park, Hong Kong’s largest residential enclave, developers are dropping prices for new projects to drum up sales amid rising interest rates at home and abroad.
Villa Garda I in Lohas Park, developed by Sino Land, K Wah International and China Merchants Land, has priced a first batch of 128 flats at HK$17,888 ($2,279) per square foot on average, down 14.5 percent from their initial launch price. Read more>>
Plans Filed for Gaw Capital Skyscraper on London’s Isle of Dogs
Plans have been submitted for the construction of Gaw Capital’s London One East Point tower on the Isle of Dogs in London’s East End.
The 52-storey residential skyscraper was designed by architect Make for the Hong Kong-based private equity firm. It will have 52,000 square metres (559,723 square feet) of space, including a lower podium and two basement levels. A mix of affordable and market homes are planned for levels up to the 24th floor, while the upper levels will be for market sale. Read more>>
High Rents, E-Trading Chase Brokerages From Hong Kong’s Central
High rents and the development of electronic trading have driven many brokerage firms out of Hong Kong’s Central district and into other areas of the city in a major shift from the days before the 1997 handover, when a Central address was essential.
About 50 percent of the city’s 600 brokerage firms have their offices or branches in Wan Chai, Causeway Bay, Tsim Sha Tsui and other parts of Kowloon and the New Territories, according to an estimate by Christopher Cheung, founder and CEO of Christfund Securities. Read more>>
China Property Slump Seen as Bigger Threat Than COVID Lockdowns
While global attention is focused on the economic impact of COVID-19 lockdowns in Shanghai and Beijing, the slump in China’s housing market is likely to have even more profound implications.
An official index that tracks apartment and house sales has posted year-on-year declines for 11 months straight — a record since China created a private property market in the 1990s. With demand for services and commodities generated by housing construction and sales accounting for about 20 percent of GDP, that represents a big drag on growth this year. Read more>>
Architect of Singapore’s Housing Boom Is Getting Worried
Glossy, cosmopolitan Singapore is playing host to a very unusual balancing act. The city is one of Asia’s most expensive property markets — and at the same time, boasts one of the highest home ownership rates in the world.
As the chief architect of Singapore’s Housing Development Board, Liu Thai Ker was instrumental in establishing a housing model that has underpinned decades of astonishing economic growth. But in the past few years, that model has come under heightened scrutiny. Read more>>
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