Troubled developer Kaisa plans to resume Shenzhen property sales

[HONG KONG] Kaisa Group Holdings Ltd, the Chinese developer in the midst of a protracted debt restructuring, plans to resume sales at three property projects in Shenzhen as early as this month, promising to ease its financial woes.

Kaisa is in talks with creditors to resolve sales that have been blocked at Kaisa City Plaza, Yuefeng Garden and Qianhai Plaza, Tam Lai Ling, a senior adviser and former Kaisa vice chairman, said in a phone interview Wednesday.

The company hopes to sign a framework agreement with an onshore creditor committee this week or next to push forward its debt restructuring, he said.

The resumption of sales will help ease a liquidity crunch at Kaisa after the Shenzhen government blocked sales of its local projects late last year amid an anti-corruption probe, forcing the developer to seek the debt restructuring with creditors.

Sunac China Holdings Ltd dropped a planned acquisition of the company in May after finding Kaisa's net asset value was zero, Sunac Chairman Sun Hongbin said June 18.

Kaisa's US$800 million of 8.875 per cent 2018 notes gained 0.56 cent to 49.78 cents on the dollar as of 11.31am in Hong Kong, according to Bloomberg-compiled prices. Its US$500 million of 10.25 per cent 2020 notes climbed 0.81 cent to 50.03 cents. Both securities traded at their highest levels since July 7.

Most of the government-imposed restrictions were lifted in April, however courts are preventing sales after creditors sued the developer, Kaisa, which is based in the southern Chinese city, said then.

BLOOMBERG