Debt issues for Chinese real estate enterprises have been increasingly common in recent years. Greenland Holdings said recently that it would seek a one-year rollover of a 500 million dollar debt that is scheduled to mature.
Furthermore, Greenland intends to sell billions of yuan of assets over the next three years to pay off its debt. The company’s current interest-bearing debt balance stands at around 36 billion dollars.
According to Sohu, Greenland Holdings announced on May 27 that it intends to make certain adjustments and forgo the commencement of a consent solicitation.
It involves extending the maturity date, allowing the issuer to redeem all or part of the notes before maturity, paying 10% of the outstanding principal on the original maturity date first, and terminating the covenant to keep the notes listed.
Greenland Holdings issued the 500 million dollar note on June 25, 2019, with a coupon rate of 6.75%. The maturity date is June 25, 2022.
As Sina Finance reported, as of the end of 2021, Greenland Holdings had short-term financial liabilities of about 15 billion dollars. It also had medium-term financial liabilities of about 10 billion dollars.
The capital at the end of the year was 12.3 billion dollars which put pressure on debt service.
Sohu reported that the company plans to sell the assets in 3 years. They plan to sell 7.4 to 10.5 billion dollars of assets each year, including self-owned commercial, office, and hotel assets.
In the first quarter, 55 large projects worth around 1 billion dollars were launched. The first-quarter transactions were supposed to be sent in April, but due to the pandemic, the delivery date cannot be assured.
However, because of the epidemic’s impact, 50% of Greenland’s sales offices were previously shuttered, and contract sales in April decreased 57% year on year.
Bond Value, a Singapore-based Fintech company, reported that Standard & Poor’s (S&P) downgraded the ratings of Greenland Holdings and its subsidiaries to B2-. Meanwhile, Moody’s downgraded this company to B2.