The Guangdong government recently held a "matchmaking" meeting for state-backed developers to buy up distressed assets of debt-laden private peers, Chinese news outlet Cailianshe reported.
China Aoyuan Group (3883), Guangzhou R&F Properties (2777), Poly Developments, China Overseas Land & Investment (0688), Minmetals Land (0230), Yuexiu Property (0123) and Guangzhou Pearl River Enterprises were among the participants, the report said.
This came after the Shanghai-based media reported earlier that some large real estate enterprises with high-quality balance sheets were told by banks that they can now borrow new loans for acquisitions of embattled developers' projects, and such loans will not be included in the "three red lines" financial requirements.
Meanwhile, China Vanke (2202) decided to reduce the coupon rate for its five-year bond 19 Vanke 01 due in February 2024 from 3.65 percent in the first three years to 2.5 percent in the fourth and fifth years.
The bond, totalling 2 billion yuan (HK$2.45 billion), has a term that allows Vanke to adjust the coupon rate for the rest of two years, and bondholders can sell it back to Vanke at a par value of 100 yuan on or before Friday, according to the developers' exchange filing yesterday.
At the same time, Shimao Group is rushing to put its domestic projects, including the ones developed by Shimao Property (0813), on sale in the hope of easing its debt burden, Caixin said.
The focus of Shimao's sale is still on commercial properties, which have a long investment return cycle and are often more difficult to offload compared to the residential ones, the report said.
Several real estate firms are selecting from Shimao's project pool and state-owned enterprises may become the first batch of buyers, the report stated.
There are many potential buyers who went to do the due diligence, but not many buyers can take over such large commercial properties unless Shimao is willing to give a significant discount on the price, a source told Caixin, who also said a large price reduction is unlikely.
Separately, Longfor (0960) plans to spin off its property managing arm Longfor Intelligent Living in Hong Kong and is expected to raise up to US$1 billion (HK$7.8 billion) in the listing.
