Vietnam property woes deepen as major developer spars with creditors
THE turmoil in Vietnam’s property sector continues, with creditors embroiled in a dispute with developer Novaland Investment Group, which has failed to pay interest on a US$300 million bond.
The company is committed to resolving the impasse with holders of its 2026 overseas convertible note in “a cooperative spirit, aiming to find optimal solutions that safeguard the interests of bondholders”, Novaland said Tuesday (Sep 26).
The statement came a day after an ad-hoc group of bondholders accused the builder of foot-dragging and urged it to reach an agreement so as not to damage international investors’ confidence in the country.
Novaland is one of Vietnam’s largest developers and has become a prominent example of real estate firms in the country that are late with bond payments, at a time when China’s property crisis is also showing signs of intensifying.
The South-east Asian country’s property sector has come under pressure after a state crackdown on debt issuance following allegations of illegal activities. Novaland didn’t make the interest payment due on its convertible offshore debt in July, and has sought to extend the maturities of other bonds.
“Novaland has proposed and is currently negotiating with the ad hoc group of bondholders on a debt-restructuring plan that aligns with the company’s current financial capacity and the timeline for business recovery,” it said.
Novaland’s 2026 convertible dollar bond was trading at a deeply distressed level of 30 US cents on the dollar on Tuesday, according to data compiled by Bloomberg. The company’s shares have also slumped, down about 26 per cent this month. BLOOMBERG
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