Home Projects Resume; Coupon Deadline Looms: Evergrande Update

(Bloomberg) -- China Evergrande Group said it has resumed construction at most of its housing projects as the chairman, Hui Ka Yan, urged the cash-strapped developer to meet its target of delivering 39,000 units of apartments in December.

China’s central bank pledged greater support for the real economy, and reiterated its aim to promote “healthy” growth in the property sector and protect home buyers’ rights.

Evergrande has coupons on two bonds due Tuesday. The firm was labeled a defaulter for the first time earlier this month. Its shares have plunged 90% this year amid a rout in Chinese property stocks. The parent of developer Yango Group Co. defaulted on a dollar bond after missing an interest payment. 

Key Developments:

• Evergrande Races to Restart Projects as Debt Repayments Loom
• Yango’s Parent Is Newest China Defaulter as Property Woes Deepen
• Evergrande Vows to Ensure Delivery of 39,000 Apartments in Dec.
• China’s Central Bank Vows Greater Support for Real Economy
• Trickle of China Developer Bond Sales Shows Selective Demand

Post-Default Dollar Bond Coupon Test Faced (4:15 p.m. NY)

Evergrande will face an initial interest payment deadline for two dollar bonds Tuesday, in the property giant’s first major test of investor confidence after it was officially labeled a debt defaulter. 

The embattled firm has $50.4 million worth of coupon due on a 7.5% 2023 bond and another $204.8 million tied to a 8.75% 2025 note, according to Bloomberg-compiled data. Evergrande has a 30-day grace period to deliver the payments before a default can be declared, according to a bond issuance document seen by Bloomberg News.

Yango’s Parent Defaults on Dollar Bonds (2:47 p.m. HK)

The parent of Yango Group Co. has become the latest victim of China’s crackdown on the nation’s indebted property sector, defaulting on a dollar bond after missing an interest payment.

Fujian Yango Group Co. hasn’t paid the coupon on its 11.875% $296 million note maturing in 2023 following a 30-day grace period, it said in a filing dated Dec. 25 to the Singapore stock exchange. Failure to pay the interest after the grace period constitutes an event of default, according to the bond’s issuance document seen by Bloomberg News.

Evergrande Resumes Most Housing Projects (2:41 p.m. HK)

Evergrande said it has restarted nearly 92% of its property projects, compared with just about 50% at the beginning of September, according to a company statement released Sunday night. The number of workers involved in the projects that have resumed building has risen 31% from September to 89,000.

Guangzhou Home Sales Worst in Top 4 (10:51 a.m. HK)

Guangzhou’s new home sales fell the most among China’s four first-tier cities in terms of floor space last week, according to Bloomberg calculations based on data from China Real Estate Information Corp. on Dec. 26. Guangzhou sales decreased 142,982 square meters to 164,725.

PBOC Pledges to Support Economy (8:21 a.m. HK)

China’s central bank pledged greater support for the real economy, and said it will make monetary policy more forward-looking and targeted.

There will be more “proactive” use of monetary policy tools, the People’s Bank of China said in a statement on Saturday.

The monetary policy committee held a meeting on Friday that was chaired by Governor Yi Gang. The central bank also reiterated its aim to promote the property sector’s “healthy” growth and protect home buyers’ rights, as well as work to better meet housing demand.

Evergrande Vows Home Deliveries (8:17 a.m. HK)

Evergrande must “sprint at full speed” to meet the target of delivering 39,000 units of apartments in December, chairman Hui Ka Yan said in a meeting held Sunday night, according to a company statement.

More than 80% of decoration partners and long-term material suppliers have resumed cooperation with Evergrande, the company said. Hui said the firm can restart sales and operations and pay off debts as long as it makes every effort to resume projects and deliver to home buyers.

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