Continuous negative green space: warning of three red lines for multi project shutdown and rights protection

category:Finance
 Continuous negative green space: warning of three red lines for multi project shutdown and rights protection


Greenland holding group has received a lot of negative news recently. The three red lines alarm, multi project shutdown and rights protection, debt collection by suppliers, asset sale, and the collapse of several US dollar bonds, one by one, the market confidence dropped sharply.

The latest public information is that Greenland is putting 23.1 billion yuan of commercial office assets on the shelf, and the commercial office project recommendations exposed are from the groups business division 1 property book. Its probably one of the fastest self-help ways he can think of.

However, the green places are eager to deny their self-help intentions.

On the morning of November 19, the management of Greenland holdings held a telephone meeting with bond investors, and the specific content was not disclosed. However, at the end of the year, it will meet the centralized payment period of bonds. About 8.87 billion yuan of bonds will mature in December, and the debts due in January next year will slightly exceed 8.1 billion yuan. These are all impending debts. For the green space which is on the verge of collapse of public opinion and investment confidence, we cant add new thunder.

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Data on November 19 showed that greenbelt Holdings US dollar bonds plummeted. Among them, the U.S. dollar bonds with an interest rate of 5.875% due in 2024 fell by 2.5 cents per share, the largest drop since March 19; the US dollar bonds with an interest rate of 7.25% in 2025 fell by 2.9 cents per share, the largest decline in history. A day earlier, Greenland holdings also fell a dollar bond with an interest rate of 6.125% due in 2023, falling 1.9 cents to 92.1 cents per share.

Behind the decline in US debt, green lands high debt crisis has made investors lose confidence.

There are quite a lot of negative news from Greenland recently. Investors are worried that Greenland will default on its debts and sell them at a discount, which leads to the decline of its US dollar debt. Huang Lichong, co-founder and senior real estate financial analyst, told China real estate news. In the view of its investors, one of the most likely to default on behalf of the companys debt is Greenland.

The three red lines of real estate financing set by the regulatory layer make the problem of high debt of Greenland holdings exposed.

Taking the three red lines as the standard, as of September 30, 2020, the companys asset liability ratio after excluding advance collection was 82.38%, an increase of 1.58 percentage points compared with the beginning of the year; the net debt ratio was 183.45%, an increase of 27.85 percentage points compared with the beginning of the year; the cash short debt ratio was 0.78, increased by 0.02 compared with the beginning of the year, and the three red lines were all stepped on.

This means that Greenfields subsequent financing will be greatly restricted and it will be more and more difficult to borrow money.

High debt must have a high turnover to achieve the elimination, otherwise it will fall into the capital chain crisis. According to the data of Kerry Research Center, from January to October 2020, the full range sales volume of Greenland holdings was 241.38 billion yuan, a year-on-year decrease of 10.3%; in October, the full-scale sales volume was 23.5 billion yuan, a year-on-year decrease of 6.4%. In 2019, the contract sales amount of Greenland is 388 billion yuan, which is only 0.1% higher than that of the same period in 2018, which is 77.6% of its annual sales target.

Just last month, an organization published an article Greenland, please pay to collect debts from the southwest business unit of Greenland Group. The total amount of advertising money demanded by the article is only 75000 yuan. Soon, the article was deleted.

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Its not easy to save yourself

This is not alarmism. The urgent task of green space is how to save itself.

Earlier, it was reported that Greenland Group intends to sell 27 property projects, including 14 projects in Shanghai and Jiangsu, with a total price of 23.1 billion yuan. In the promotion projects, there are many complex buildings on the subway and mature business district properties with the advantages of downtown location.

In response, Greenland said that for Greenland, the sale of commercial projects is the norm. 30% of the sales amount of Greenland comes from commercial property sales every year. To be exact, these commercial offices can not be called assets, they are the same saleable properties as residential buildings.

If 27 commercial properties can be sold successfully, the cash flow pressure of Greenland will be greatly reduced. But whether such a large-scale asset can find a buyer in a short time and sell it at a good price is also an unknown question. After all, in the current real estate industry as a whole to reduce debt, I am afraid that it is difficult for enterprises to have cash and courage to dare to take such a large investment. Bo Wenxi, chief economist of ipglobal of environmental investment, commented that when the cash flow is critical and the assets are in a hurry to realize, and when others are pushing down prices, the price often given is less than 10% of the valuation, and a decision needs to be made at this time. Whether Greenland has the courage and ability to fight and decide to save itself as Wanda did, and whether it can have strong foreign aid as white knight determines whether Greenland can survive the crisis. After the second mixed reform of Greenland holdings, the war investment is still a mystery. Some analysts say that the introduction of financial sector of the central enterprise war investment is more likely, especially insurance capital. Source: Chen Hequn, editor in charge of China real estate news_ NB12679

If 27 commercial properties can be sold successfully, the cash flow pressure of Greenland will be greatly reduced. But whether such a large-scale asset can find a buyer in a short time and sell it at a good price is also an unknown question. After all, in the current real estate industry as a whole to reduce debt, I am afraid that it is difficult for enterprises to have cash and courage to dare to take such a large investment.

Bo Wenxi, chief economist of ipglobal of environmental investment, commented that when the cash flow is critical and the assets are in a hurry to realize, and when others are pushing down prices, the price often given is less than 10% of the valuation, and a decision needs to be made at this time. Whether Greenland has the courage and ability to fight and decide to save itself as Wanda did, and whether it can have strong foreign aid as white knight determines whether Greenland can survive the crisis.