Country Garden offers assets in Guangzhou for 3.8b yuan

Country Garden (2007) has reportedly put up a series of its assets in Guangzhou for sale at 3.82 billion yuan (HK$4.15 billion) in total, according to the National Business Daily.

Among the assets, which include offices, hotels, and apartments, the most expensive is its Phoenix City Hotel in Guangzhou's Zengcheng district, with an asking price of 1.26 billion yuan.

The hotel, which opened in 2003 and was renovated in 2017, offers 573 rooms with a total gross floor area of nearly 98,000 square meters.

Meanwhile, a major group of Country Garden's offshore creditors has appointed Kirkland & Ellis as the legal adviser, a source familiar with the matter said, in a move towards discussing debt repayment options with the defaulted Chinese developer.

Country Garden has been working on a plan to restructure its US$11 billion (HK$86 billion) offshore bonds after it missed a coupon repayment in October, becoming one of the biggest Chinese developers that have defaulted on its offshore debt.

This came as a private survey showed that the number of foreclosed homes in China rose 43 percent year-on-year in 2023, highlighting a worrying trend of rising mortgage delinquencies amid a sustained property market slump and a patchy economic recovery.

The number of foreclosed homes up for auction stood at 389,000 units last year, said China Index Academy, a major independent real estate research firm. A total of 99,000 units worth a combined 150 billion yuan were successfully sold at auctions, the firm said.

Total foreclosures, including commercial, residential, and industrial properties, land, garages, and parking spaces, totaled 796,000 units, a record high. The number was up 36.7 percent from 2022, according to the survey.

Meanwhile, J P Morgan remained cautious about the outlook of Chinese real estate developers, expecting home sales in China to fall 10 percent this year from a year ago.

Separately, China South City (1668) has told some of its creditors that it has enough cash to pay interest on its US bonds, whose grace period will expire this week.

In other news, the parent of Chinese developer Redsun Properties (1996) has received a winding-up petition in a Hong Kong court.

The court is scheduled to hold a hearing of the petition against Hong Yang Group on March 27.