China’s new home prices fell 1.24 percent in January
Average new home prices in China fell 1.24 percent in January from a year earlier as the country’s housing crisis continues to rage, with that story leading Mingtiandi’s headline roundup today. Regional private equity player PAG also makes the list with the Hong Kong and Tokyo-based company buying $48 million in bonds backed by Indian developer M3M and creditors of Shenzhen developer are trying their luck at getting the company’s state-owned backer to honour bond covenants.
China Home Prices Fell 1.24% in January as Slide Accelerates
China’s real-estate downturn is getting worse. The latest bad news: A sharp drop in the average price of a home in 70 big cities in mainland China, a proxy for the national market.
New home prices fell 1.24 percent from a year earlier, accelerating from December’s 0.89 percent decline, according to calculations by The Wall Street Journal based on data released Friday by China’s National Bureau of Statistics. Secondhand home prices did even worse, falling by 4.4 percent in January compared with a year earlier. It was the steepest such decline in almost nine years. Read more>>
PAG to Invest $48M in Indian Developer M3M’s Bonds
PAG Asia, one of the largest global alternative investment managers, will invest INR 4 billion ($48 million) in bonds of a M3M India group entity to refinance existing debt and acquire land, said people with knowledge of the matter.
PAG’s Asia Pragati Strategic Investment Fund will invest in Lavish Buildmart, a 100 percent subsidiary of M3M India – the real estate developer whose promoters were questioned by the Enforcement Directorate last year for unauthorised transactions with the IREO group. Read more>>
China South City Creditors to Sue SOE Backer on Keepwell Clause
A group of offshore creditors of China South City is set to file a lawsuit against the debt-laden developer’s biggest state-owned shareholder for dues, four sources said, in what would be the first such case in the crisis-hit property sector.
China South City earlier this month missed a principal payment of $11.25 million on a dollar bond due on 9 February, and is deemed by creditors to be in default on offshore debts worth $1.3 billion, two bondholder sources said. Read more>>
OMERS Generates $5.6B in Investment Income in 2023
OMERS, the defined benefit pension plan for broader municipal sector employees in the province of Ontario, generated a 2023 investment return of 4.6 percent, or $5.6 billion, net of expenses.
Over the past 10 years, OMERS has averaged an annual investment return of 7.3 percent, net of expenses, adding $66.4 billion to the Plan. Net assets at 31 December 2023, were $128.6 billion, up from $124.2 billion in 2022, and the Plan reported a smoothed funded status of 97 percent, up from 95 percent last year. Read more>>
Japan’s Sekisui House Buys Sydney Project From China’s CIFI for $72M
Japanese developer Sekisui House has become the latest player to capitalise on the tide of Chinese developers exiting, picking up a major site on Sydney’s north shore from China’s CIFI for close to A$110 million ($72 million).
Sekisui bought the St Leonards site as Chinese developers continue to sell off Australia projects with CIFI currently restructuring its debts after defaulting on overseas borrowings in 2022. Read more>>
StanChart Considers Boosting Real Estate Exposure as Rivals Exit
Even as many banks seek to trim their exposure to real estate globally, Standard Chartered Plc has signaled it could expand its presence in the market as it spies opportunities in the wake of the withdrawal of other players.
Despite having been stung by the collapse in property values in China, the emerging markets-focused bank said it could look to build its exposure to Western real estate in the coming months. Chief Executive Officer Bill Winters acknowledged the hit the bank had taken on Chinese property, but said that the lender was “quite underweight commercial real estate in other markets.” Read more>>
HK Legal Battle Underscores Risks of Private Loans to Developers
Hong Kong private credit firm Pacific Aegis Capital Management Group Ltd is locked in a legal tussle with a small local property owner over a deal that failed to materialize.
PACM Group filed a counter claim on Friday at Hong Kong’s High Court against private Hong Kong real estate owner Top Gear Investment Ltd, corporate vehicle Pure Wide Ltd and the director of both of those entities, George Wong, some 10 weeks after the three parties filed a lawsuit against PACM Group. Read more>>
BHG Retail REIT H2 DPU Falls 80.5%
BHG Retail REIT reported on Friday a 80.5 percent decline in distribution per unit for the second half of 2023, despite higher net property income.
The China-focused REIT saw DPU for the six months ended 31 December 2023, fall to S$0.0008 from S$0.0041 ($0.00060 from $0.0031) in the year-earlier period. Read more>>
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