Real Estate

Well-behaved Chinese property giant shows stress

9 Nov 2021

Vanke has kept leverage under control. With peers like Country Garden racing to acquire distressed rivals and home sales falling, the country's third-largest developer is finally listing its property management unit to raise some $2 bln. It may have waited too long.

Capital Calls: Zillow’s failed house flipping

2 Nov 2021

Concise views on global finance: The real estate site is exiting buying and selling homes. An easy source of revenue growth isn’t worth a ballooning balance sheet, higher risk, and losses.

China’s property tax will grow sharper teeth

27 Oct 2021

President Xi Jinping has thrown his weight behind an unpopular but economically beneficial real estate levy. Previous experiments in Shanghai and Chongqing disappointed, so the next round of trials could be harsher and riskier. It will test Xi’s power and policy creativity.

Evergrande payment wins some restructuring credit

22 Oct 2021

The developer has wired an $84 mln coupon to bondholders just days before a potential default. It suggests goodwill ahead of an inevitable debt rejig. If boss Hui Ka Yan is prepared to actively work with creditors, he could set standards for other distressed situations in China.

Capital Calls: WeWork listing, Polish games maker

21 Oct 2021

Concise views on global finance: The battle-scarred office-sharing outfit finally started trading on the NYSE after its deal with a blank-check company closed; CD Projekt delays chunky updates to its flagship “Cyberpunk” video game, avoiding a repeat of last winter.

Evergrande vultures swoop into moral hazard

20 Oct 2021

The Chinese developer’s deals to sell its headquarters and property management arm may have hit political snags. Overpay and it looks like a bailout; a lowball bid invites cries of opportunism. Quick deals preserve value in a crisis. Hesitant governments hurt more than they help.

Russian IPO salad hides some dodgy ingredients

18 Oct 2021

Helped by a global boom, new listings by the country’s companies are at their most active since 2007. Investors are more used to sanctions risk, while Covid-19 has spruced up hopefuls such as real estate website Cian. Others, like St Petersburg’s bourse, may be lumpy leftovers.

China growth is stuck in low gear for the duration

18 Oct 2021

Economic expansion slowed to 4.9% last quarter as austerity, Evergrande fallout, Covid-19 and a power crunch bit. President Xi Jinping, though, is targeting longer-term issues like inefficient growth and inequality. That’s a cue for China-dependent markets to brace for impact.

Capital Calls: Real estate distress is tricky call

15 Oct 2021

Concise views on global finance: Barry Sternlicht’s Starwood Capital has raised a $10 bln fund to buy struggling buildings. With the pandemic's long-term effects unclear, the key will be avoiding those destined to remain empty.

Elliott REIT activism exploits real estate oddity

14 Oct 2021

The activist is pushing healthcare office owner HTA to sell. The CEO left and the $7 bln trust can’t outbid private equity real estate funds that can lever up cheaply. But it can sell to them, and then investors can turn around and buy another public REIT.

Evergrande crisis inspires shrewd bottom-feeding

7 Oct 2021

Tycoon Joseph Lau offered just $250 mln for the 25% of Chinese Estates his family doesn’t own. Shares were hit by its long backing of its ailing peer, whose boss plays poker with Lau. As with a rival’s mooted deal for an Evergrande unit stake, current owners may have to fold.

Hong Kong tycoons laugh off Xi’s inequality push

7 Oct 2021

Real estate is overheating while residents get gouged at the grocery store. Leader Carrie Lam wants to increase housing supply but has propped up home prices and left elite monopolies alone. So far President Xi Jinping’s “common prosperity” drive is steering around the city.

Capital Calls: Facebook, TeamViewer, Audio M&A

6 Oct 2021

Concise views on global finance: Whistleblower Frances Haugen’s polished rollout is a warning for Big Tech; the video software specialist’s 25% share price fall shows the perils of growth stocks; hearing aid group GN snaps up headset maker SteelSeries for $1.3 bln.

China’s bad loan markets will pad property crash

5 Oct 2021

The real estate crisis is rich pickings for distressed debt investors, as new exchanges and special courts have become more efficient at resolving duff loans. President Xi Jinping is no capitalist, but when it comes to popping bubbles, he’s allowed room for market forces.

Data center holdout needs new class of buyer

1 Oct 2021

The nearly $10 bln CyrusOne is exploring a sale after missing out on previous consolidation. A historical discount to rivals is an opportunity for infrastructure investors keen on the expanding sector. But any suitor will have to overlook challenges that put off others.

Chancellor: Evergrande is all China’s woes in one

30 Sep 2021

The property developer’s spectacular collapse is the fruition of a massive real estate bubble, over-investment, excessive debt buildup and a wobbly credit system. As China’s bubble economy deflates, it will be replaced by a new one under President Xi Jinping’s absolute command.

Evergrande restructuring is well-balanced so far

29 Sep 2021

Local officials are helping suppliers get paid and consumers receive flats bought in advance, soothing buyer anxieties. Bigger investors in the struggling Chinese developer will therefore shoulder bigger losses. It’s a tolerable mix of political expedience and financial sense.

Viewsroom: Evergrande is a mostly domestic crisis

23 Sep 2021

Global investors have woken up to the potential financial risks that the heavily indebted Chinese property developer poses. Breakingviews Asia columnists explain, though, that even in a worst-case scenario its effects beyond the country’s borders should be limited.

Capital Calls: Airline partnerships, Labor market

21 Sep 2021

Concise views on global finance: An alliance between American and JetBlue could fall foul of the U.S government, even though Washington could benefit from it; U.S. Bancorp’s promised savings in its deal to buy MUFG Union may be easier than usual to achieve without firing people.

Wall Street will learn to love Evergrande’s crash

21 Sep 2021

New York woke up to the developer’s problems on Monday, moving stocks and bond prices. Offshore exposure to Evergrande debt is opaque; a Chinese real estate crisis would be painful. But contagion risk is limited, and a housing correction has upsides for frustrated foreign banks.