658.94 Billion Yuan in Chinese Real Estate Company Bonds Set to Mature in 2022, 53% Owed to Offshore Holders

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Figures from a leading state-owned think tank indicate that over half of the bonds issued by Chinese real estate concerns that are scheduled to mature in 2022 are held by foreign investors.

Data from the China Index Academy (中指研究院) indicates that 658.94 billion yuan (approx. USD$103.80 billion) in bonds issued by Chinese real estate companies are set to come due this year, of which 53% are offshore bonds.

The peak for offshore bond repayments will come in the first half of 2022, while for domestic bonds it will arrive during the six month period from March to September.

The Academy said that real estate company financing would diverge sharply in 2022, with some companies proving their mettle via risk disposable capability and the maintenance of stable operations, and investors becoming far more leery of others due to liquidity their liquidity challenges.

For this reason they expect a “polarisation” of fund flows, which will concentrate in high-quality real estate concerns with stronger ratings.

Repayment pressure has already prompted many Chinese real estate companies to step up financing plans since the start of 2022.

On 14 January Bin Jiang Real Estate Group announced that it would apply with the interbank market authority to issue up to 3.5 billion yuan in medium-term notes and 3.5 billion yuan in short-term notes, while Zhuhai Huafa said it plans to issue up to 1 billion yuan in 3+2 year instruments, and Xiamen ITG unveiled plans to issue 1 billion yuan in instruments with a term of 114 days and a coupon rate of 2.6 – 3.2%.

On 13 January Sunac announced plans to issue 452 million shares priced at 10 Hong Kong dollars per share, and COFCO Property unveiled plans to issue up to 1.5 billion yuan in 5 and 7-year bonds.