Evergrande Rolls Out New Restructuring Plan and More Asia Real Estate Headlines

China Evergrande Offers Creditors 30% stakes in subsidiaries as a new debt restructuring plan

China Evergrande leads the region’s real estate news again today with the defaulting mainland developer proposing a new debt restructuring plan providing creditors equity in its electric vehicle and property management units. Also in the headlines, Hong Kong cancels a land sale after all four bids fell short of expectations, China’s new home prices edge upward for a second straight month and more hotel rooms may be on the way at a Singapore casino.

China Evergrande Offers Creditors 30% Stakes in Subsidiaries 

China Evergrande Group has proposed a new debt restructuring plan for offshore bondholders, offering to swap their debts into about a 30 percent equity stake in each of the developer’s two Hong Kong-listed subsidiaries, according to two sources familiar with the matter.

The property firm’s offshore bondholders holding about $19 billion in debt are likely to take a major haircut on their investments if they agree to the new terms, said the two sources who declined to be named because they were not authorised to speak with the media. Read more>>

Hong Kong Cancels Tung Chung Land Sale After Bids Fall Short of Auction Reserve 

The Hong Kong government on Wednesday withdrew a residential site in Tung Chung as all four bids from developers came in below the reserve price in a further blow to the city’s land sales target. The cancelled tender also market the fifth land parcel to have failed to secure winning bids so far this year.

Only two sites have been sold by the government this fiscal year and the accumulated amount of HK$15.6 billion only represents 18 percent of its annual land sale target of HK$85 billion. When bids closed last Friday, the site identified as Town Lot 55 in Area 106B in Tung Chung had received just four tenders, from Henderson Land Development, Sun Hung Kai Properties, K Wah International and Sino Land in collaboration with China Merchants Land. Read more>>

China New Home Prices Rise for Second Month in October

China’s new home prices rose for a second straight month in October, private-sector data showed on Wednesday, but analysts say more supportive measures will be needed in major cities to sustain the recovery.

Prices rose 0.07 percent on average month on month, widening an increase of 0.05 percent in September, according to a survey by China Index Academy, a real estate research firm. Read more>>

Genting Gets Nod to Expand Resorts World Sentosa

An indirect wholly owned subsidiary of Genting Singapore has received provisional permission from the Urban Redevelopment Authority to develop 21,243 square metres (228,658 square feet) gross floor area of retail space and 700 hotel rooms at Resorts World Sentosa.

The retail space works out to 228,658 square feet. The above scheme is expected to be part of the pledge Genting Singapore made in 2019 to invest S$4.5 billion ($3.2 billion) to expand its RWS integrated resort with new non-gaming attractions. There are currently five hotels with a total of about 1,600 rooms in RWS. Read more>>

Mainland Homeowners Protest Developer Price Cuts

After being stuck in a housing downturn for two years, cities across China are giving developers the go-ahead to cut prices on new homes to revive sales.

They are quickly running into resistance from homeowners who don’t want to see the values of their properties go down. Read more>>

China’s Property Sector Loans Contract for First Time

China’s outstanding property loans fell on a yearly basis for the first time on record, underlining stress in the sector despite official assurances of stabilising declines.

The outstanding amount of loans to the property sector fell by RMB 100 billion to RMB 53.19 trillion ($7.3 trillion) at the end of September compared with the level a year earlier, according to a statement from the People’s Bank of China on Wednesday. That’s the first year-on-year drop in the data going back to 2005. Read more>>

Hong Kong to Build 60 Hectare University Town

A university town spanning more than 60 hectares (148.3 acres) is expected to be completed in Hong Kong some time after 2030 under a plan to foster collaboration with renowned mainland Chinese and overseas institutions.

The university town was included in the development of the Northern Metropolis megaproject outlined in the policy address that city leader John Lee delivered last week. Read more>>

S&P Says WeWork in ‘Selective Default’

Embattled flexible workspace provider WeWork is in “selective default” after failing to meet conditions set by debt holders, ratings agency S&P said Wednesday.

S&P’s statement came a day after WeWork recounted its latest communications with creditors, saying in a securities filing that bondholders had given it a 30-day grace period on 2 October on interest payments. Read more>>

Shapoorji Pallonji Eyes $180M in Revenue from Pune Housing Projects

Shapoorji Pallonji Real Estate on Wednesday said it has launched two housing projects at its 200 acre (80.9 hectare) township in Pune and is expecting revenue of INR 15 billion ($180 million) from them. In a statement, the company said it is developing a 200 acre urban development project, SP Kingstown, in Pune’s Hadapsar Annexe.

It will develop housing, commercial, educational, healthcare and retail spaces in the large township. Shapoorji Pallonji Real Estate has come up with two housing projects, Wildernest and Joyville Celestia, with a development potential of over 1.7 million square feet (157,935 square metres). Read more>>

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