news

한어Русский языкEnglishFrançaisIndonesianSanskrit日本語DeutschPortuguêsΕλληνικάespañolItalianoSuomalainenLatina

According to data recently released by CRIC, the total financing of 65 typical real estate companies in July was 52.346 billion yuan, an increase of 63.8% month-on-month, and the monthly financing scale hit a new high since 2024. Specifically, in terms of bond issuance, a total of 9 companies issued bonds in July, among which Yuexiu Real Estate's issuance volume was particularly eye-catching.

However, behind the accelerated financing is Yuexiu Real Estate's sales slowdown. Data shows that the cumulative contract sales amount in the first seven months only achieved 41.1% of the annual target. How to balance financing and sales is the current proposition for the sustainable development of real estate companies.

7The financing scale from the month to date is about 56.9100 million

According to CRIC statistics, Yuexiu Real Estate issued one offshore green priority note worth 1.69 billion yuan and two corporate bonds worth a total of 1.5 billion yuan in July.

On July 8, Yuexiu Real Estate announced that the company plans to issue 1.69 billion yuan of guaranteed green notes to raise funds for replacing a number of medium- and long-term offshore bonds due within one year. The bonds were listed and traded on July 15. It is worth noting that this issuance is Yuexiu Real Estate’s first green bond issuance and the largest offshore bond issuance in the real estate industry so far in 2024. Previously, Yuexiu Real Estate also established a long-term goal to achieve at least 50% of bond and loan financing from green finance by 2030.

On July 9, Yuexiu Real Estate announced that the issuance scale of the first phase of corporate bonds in 2024 will not exceed RMB 1.5 billion, divided into two types: Type 1 is a five-year fixed-coupon rate bond, the issuer can choose to adjust the coupon rate at the end of the third year, and the issuer has the right to redeem and the holder has the right to sell back; Type 2 is a ten-year fixed-coupon rate bond. The proceeds will be used to repay the maturing corporate bonds after deducting the issuance costs.

On July 18, Yuexiu Real Estate once again released a financing agreement and related shareholder information. According to the announcement, Yuexiu Real Estate's wholly-owned subsidiary Hongjing Co., Ltd. signed a financing agreement with a bank on July 18. The agreement stipulates that Hongjing Co., Ltd. will obtain a loan of HK$700 million (or equivalent in RMB) with a loan term of 364 days.

In August, Yuexiu Real Estate announced again on August 8 that Guangzhou Urban Construction Development Co., Ltd., a subsidiary of the company with a 95% equity interest, was approved as the issuer to issue a private placement of a targeted debt financing instrument with a total principal amount of up to RMB 3 billion in the inter-bank market of China. The targeted instrument will be issued in installments, with the first installment in 2024 not exceeding RMB 1.8 billion. The proceeds will be used to repay the maturing targeted debt financing instruments after deducting the issuance expenses.

Yuexiu Real Estate has accelerated the refinancing of existing debts. According to incomplete statistics, the financing scale from July to now is about 5.69 billion yuan. As the industry bottoms out, the company's later sales collection deserves attention.

Sales pressure, land acquisition slows down

For real estate companies, sales are a self-sustaining function.

In July this year, Yuexiu Real Estate's sales amounted to only about 5.028 billion yuan, a year-on-year decrease of about 40.7%, setting a record for the company's lowest monthly sales this year. The year-on-year decline in July was also higher than the average level of the top 100 real estate companies. According to CRIC Real Estate Research, in July 2024, the top 100 real estate companies achieved sales of 279.07 billion yuan, a year-on-year decrease of 19.7%.

Specifically, Yuexiu Real Estate's monthly contract sales and year-on-year sales from January to June were: sales of 6.545 billion yuan in January, down about 26.3% year-on-year; sales of 6.545 billion yuan in February, down about 26.3% year-on-year; sales of 11.341 billion yuan in March, down about 46.6% year-on-year; sales of 8.312 billion yuan in April, down about 37.6% year-on-year; sales of 10.078 billion yuan in May, down about 18.4% year-on-year; sales of 15.308 billion yuan in June, up about 8.5% year-on-year.

Supported by sales in May and June, Yuexiu Real Estate's cumulative contract sales amount from January to July was approximately RMB 60.429 billion, a year-on-year decrease of approximately 34.4%, and the decline was basically the same as the industry average.

In the next five months, Yuexiu Real Estate's average monthly sales must exceed 8 billion to keep its title of "100 billion real estate company". In the first seven months, it only achieved 41.1% of its 2024 sales target. In addition, market fluctuations have also affected the evaluation of investment institutions. In June, UBS lowered Yuexiu Real Estate's target price from HK$11.7 to HK$7.2.

Sales are under pressure, and land acquisition has slowed down accordingly. In the first seven months of this year, Yuexiu Real Estate ranked 16th with only 6 billion yuan of land acquisition, while the amount of land acquisition in the same period last year was as high as 21.3 billion yuan, ranking 7th. In March this year, the company's management said that the budget for land acquisition in 2024 is 40 billion yuan. How it will perform in the second half of the year is worth looking forward to.