Following a modest rebound in home-buying sentiment last week, several large real estate developers in mainland China announced plans to raise new debt financing as competition grows for land purchases.
During this past week, Shenzhen-listed developer Sunshine City revealed that it intends to raise over RMB 22 billion ($3.27 billion) through both onshore and offshore channels, including signing a cooperation agreement with JIC Trust for RMB 20 billion in new debt.
Keep reading for all the details on these stories and more in Mingtiandi’s roundup of China real estate finance news.
On 24 April 2019, Sunshine City announced on its corporate WeChat account that it successfully issued its first headquarters REIT product, Huatai Jiayue-Sunshine Holdings Building Asset Support Special Plan, which was managed by Huatai Asset Management Company with sales of the the securities brokered by Huatai Securities and China Merchant Securities.
The issue of the asset-backed security was 2.5 times oversubscribed, according to the developer, which raised RMB 2.1 billion through the sale. The security provides returns based on income from the Sunshine Holdings Building in Shanghai’s Yangpu district. The commercial building currently provides offices for six divisions of the Sunshine Holdings Group, including Sunshine City. Read more>>
Sunshine City continued its fund-raising surge on 25 April when it announced that it had signed an agreement with JIC Trust for the unit of China Jianyin Investment Ltd. to assist the developer through arrangement of non-standard loans, real estate trust investment and asset securitization, of up to RMB 20 billion in value.
The agreement with JIC comes as Sunshine City struggles to regain its financial footing after the company, also known as Yango City, saw its major financial backer, China Minsheng Investment Group (CMIG) become mired in a corruption scandal earlier this year. Read more>>
On 26 April 2019, Sunshine City announced that the company is raising RMB 2.2 billion through direct financing products, including corporate bonds, asset securitization and perpetual bonds.
According to the announcement, the company intends to use the net proceeds for debt repayment, project investment and debt restructuring. Earlier this month the Shenzhen-listed developer had announced that it would issue short term notes totalling RMB 900 million. Read more>>
Shanghai Industrial Development announced to the Shanghai Stock Exchange on 25 April that it had received approval from the China Securities Regulatory Commission to issue the first phase of the company’s 2019 corporate bonds scheme.
The industrial real estate developer’s new domestic notes will be issued in two tranches carrying a three year and a two year maturity, respectively, and with yields ranging from 3.5 percent to 4.5 percent, the company said. CITIC Securities Company Limited assigned its ‘AA+‘ long-term issue rating to the first phase of Shanghai Industrial Development’s corporate bonds. Read more>>