Chinese government buys Hyatt assets from struggling developers: These are government bailouts of the hotel industry, China-style.
Chinese property developer Shimao Group said on Friday it will sell a hotel in Shanghai to state-owned Shanghai Land Group for 4.5 billion yuan ($707.83 million), as it seeks to reduce its debt amid a crisis in the country’s property sector. wants.
The deal is part of the Chinese government’s push to buy properties from cash-strapped private developers, as Beijing steps up efforts to try and tighten control over the troubled sector, which accounts for a quarter of its economy.
Shimao, who defaulted on a trust loan earlier this month, said it would sell an entity whose core assets are Hyatt on the Bund Hotel to Shanghai Land Group.
According to Moody, the developer has $1.7 billion offshore with maturity and 8.9 billion yuan onshore in 2022.
The move comes on the same day that another Chinese property firm Agile Group sold a stake in several units to state-owned China Overseas Land and Investment and China Conch Venture for about 2 billion yuan.
Regulatory restrictions on lending have plunged China’s property firms into debt woes, with sector bellwether China Evergrande grappling with $300 billion in liabilities.
Chinese government buys Hyatt assets from struggling developers