WeWork Lenders Explore Bankruptcy Plan and More Asia Real Estate Headlines

In today’s roundup of regional news headlines, WeWork’s creditors eye bankruptcy proceedings for the flexible office giant, and the Chinese government approves business plans for two fund management giants. Also making the cut are a court ruling on contested land use at Hong Kong’s oldest golf course and Fitch’s downgrade of Country Garden Services.

Wall Street Funds Discuss Potential Bankruptcy Plan for WeWork

A group of Wall Street firms that lent hundreds of millions of dollars to WeWork is exploring the possibility of a bankruptcy filing that could help the company exit from expensive office leases, one of several options under discussion, according to people familiar with the creditors’ talks.

After WeWork raised doubts about its ability to stay in business a few weeks ago, fund managers including BlackRock, King Street Capital and Brigade Capital are holding preliminary talks about the company’s restructuring options and indicated that they would support a plan for WeWork to file for Chapter 11 bankruptcy, the people said. Read more>>

Allianz Global Investors, Blackstone Get China Regulatory Approvals

Chinese regulators on Thursday granted approval to Allianz Global Investors to set up an onshore fund management company and gave Blackstone’s newly established China unit approval to raise funds that will be invested overseas.

The approvals came as Beijing vowed to step up efforts to attract foreign companies amid sluggish economic growth, and following the stock market regulator’s pledge last week to “boost the vitality, efficiency and appeal of the market”. Read more>>

Evergrande Applies to Resume Share Trading in Hong Kong on 28 August

China Evergrande Group, the defaulted developer at the heart of the country’s real estate crisis, applied to resume stock trading after a 17-month halt, saying it has fulfilled all the listing requirements.

Evergrande is seeking to restart trading in Hong Kong on 28 August, ending a suspension that began in March last year, according to a filing Friday. The developer released long-delayed earnings last month for 2021 and 2022, helping it meet requirements to resume trading. Read more>>

Court Extends Temporary Halt on Building Public Flats at Hong Kong Golf Course

A Hong Kong court has extended a suspension of environmental authorities’ approval to build public housing on part of the city’s oldest golf course until a judicial challenge against the decision is resolved.

But Wednesday’s High Court ruling does not prevent development authorities from beginning pre-construction work on 9.5 hectares (23.5 acres) of the land in Fanling leased by the Hong Kong Golf Club, provided that it does not result in any environmental damage. Read more>>

Fitch Downgrades Country Garden Services, Places Rating on Negative Watch

Fitch Ratings has downgraded Country Garden Services’ long-term issuer default rating to BB+ from BBB- and placed the rating on a negative watch.

The downgrade reflects the agency’s view that the property management firm’s growth, brand reputation, profitability and funding access may be negatively affected by the heightened liquidity pressure at its sister company, Country Garden Holdings Co Ltd. Read more>>

Evergrande’s Services Arm Posts 43% Profit Jump on Margin Lift

China Evergrande’s property management services unit reported a 43 percent increase in profit in the first half, a positive development as the real estate giant edges towards one of the nation’s largest restructurings.

Evergrande Property Services recorded net income of RMB 781 million ($107.1 million) in the first half, the company said in a Hong Kong stock exchange filing late Thursday. It generated growth across revenue, gross profit margin and area under management. It did not declare an interim dividend. Read more>>

Rapidly Rising Condo Prices Causing Rental Renaissance in Japan

An interesting shift is underway in Japan’s rental market as investors and developers see the potential in roomier apartments. This has been spurred on by the rising price of condominiums.

Would-be home buyers priced out of the market are renting instead, leading to a new influx of tenants. According to the Ministry of Land, Infrastructure, Transport and Tourism, rental housing starts in 2022 increased by 5 percent from the previous year to 347,427 units nationwide. Read more>>

Korean NPS Likely to Give Full Rights on Asset Management to Experts

National Pension Service of South Korea, the world’s third-largest pension fund, is poised to give investment experts full rights over mid-term asset allocations in a bid to ramp up the profitability of the fund, which is forecast to be completely drained in 2055 under the current management system.

NPS’s committee for financial calculation has included the suggestion in a final report that will be submitted to Ministry of Health and Welfare, according to government sources on Friday. Read more>>

Wealthy Myanmar Nationals on Condo-Buying Spree in Thailand

Thailand has, for decades, been a destination for Myanmar’s migrant workers, with more than 2.5 million people from Myanmar — many of them refugees from ethnic minority groups — now living and working in the kingdom.

Of late, however, Southeast Asia’s second-largest economy has seen a new wave of Myanmar migrants: high-net-worth individuals who have been snapping up pricey condominiums in cities such as Bangkok and Phuket. Read more>>

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