
CC Land acquired the Cheesegrater in 2017. (Source: Getty Images)
Mainland China developer CC Land Holdings has secured £605 million ($716.82 million) in fresh financing for its “Cheesegrater” office tower in London in a deal led by HSBC, according to a statement by the banking giant on Monday.
HSBC’s UK and Hong Kong divisions, with support from Bank of China (Hong Kong), UBS AG, Hang Seng Bank and The Bank of East Asia arranged the new financing for the Leadenhall Building in the City of London some five years after CC Land, a Hong Kong-listed developer with operations centred in the western China city of Chongqing, had purchased the 46-storey tower for £1.15 billion in what was then the second largest acquisition of a UK building ever.
CC Land did not provide details of the financial arrangement, however, some analysts suggested that with home sales in China expected to decline by 10 percent this year, the developer led by free-spending billionaire Cheung Chung-kiu could be under financial stress.
“CC Land has no doubt run into cash flow problems in China and is seeking help from ‘the home team’ of Hong Kong based banks,” said Andrew Collier, managing director of Orient Capital Research. During 2022 some of China’s largest developers, including Evergrande and Sunac have defaulted on debts, with other major players working with creditors to restructure their liabilities.
3.5% Yield in 2021
“We’re pleased to have worked with HSBC and our other banking partners to achieve the refinancing for The Leadenhall Building,” said Peter Lam, CC Land’s deputy chairman and managing director. “The funding will continue to support the business as we develop our international property portfolio.”

CC Land boss Cheung Chung Kiu hears London calling
Standing as one of the tallest buildings in the UK, the 225-metre-tall (738 foot) trophy asset at 122 Leadenhall Street in central London was completed in 2014 with 96 percent of all office space leased as of end-2021, according to CC Land’s latest annual report.
The 610,000 square foot (56,670 square metre) property generated £39.8 million in rental income last year, which was a tad higher than the £39.7 million in 2020 despite market uncertainties and disruptions caused by the prolonged coronavirus pandemic.
Last year’s figure, however, was still down 1.7 percent from the Cheesegrater’s pre-pandemic rental income of £40.5 million in 2019 when the office space was 100 percent leased. For 2021 the office tower produced a rental yield of around 3.5 percent from leases to tenants including global insurance and reinsurance firms Brit Insurance and MS Amlin, as well as financial services company Aon.
CC Land had purchased the building from a joint venture between UK developer British Land and Oxford Properties – the property arm of Canadian public pension fund OMERS.
London Love Affair
Since leading his company’s landmark purchase of the Cheesegrater, CC Land chairman Cheung Chung Kiu, has pursued a series of high profile investments in the UK capital.
Just a few months after purchasing 122 Leadenhall Street, CC Land teamed up with three Hong Kong-based investors in an ultimately unsuccessful attempt to purchase a majority stake 40 Leadenhall Street, an office development now known as Stanza London, from TH Real Estate (now Nuveen Real Estate).
Then in 2019 CC Land committed £182 million ($236 million at the time) to a London regeneration joint venture with London-based property investment firm Meyer Bergman to transform the Whiteleys department store in Queensway in a £1.2 billion project.
In 2020 Cheung continued his London love affair by paying a reported £210 million ($274 million) for a 45-room mansion in Knightsbridge, where he later took on renovations estimated at another $250 million.
During May of this year Cheung agreed to buy out Guangzhou R&F Properties’ 50 percent stake in a London joint venture with CC Land for HK$2.66 billion ($340 million). CC Land entered the London market in January 2017 with its £290 million purchase of the 1 Kingdom Street office building in London’s West End.
With investment and development projects across mainland China, Hong Kong and Melbourne, Australia in addition to the UK, CC Land Holdings, saw its net profit drop to HK$490.1 million ($62 million) last year, which was down 16.7 percent from a year earlier after posting a nearly 60 percent drop in non-property income and realising fair value losses on treasury investments and increased operating expenses.
Developer Debt Woes
CC Land’s refinancing deal comes amid a series of major Chinese developers seeking funding options to stay afloat.
China Evergrande on Monday announced that local creditors rejected its proposal to delay repayment of a RMB 4.5 billion ($670 million) onshore bond. Known as the world’s most indebted developer, the company pledged to “continue to actively negotiate with bondholders” for its debt repayment scheme.
Evergrande’s domestic credit drama came as the developer faces a winding-up petition in Hong Kong filed by an investor in its Fangchebao online platform.
Also on Monday, Guangzhou R&F announced Asia’s largest restructuring of real estate debt ever with holders of the developer’s bonds agreeing to give the company an additional three to four years to pay off $5.1 billion in notes.
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