Mainland developer Greentown to issue US$350 million bond to refinance debt

The three-year notes issued by the Hangzhou-based company have a yield of 8.45 per cent, according to a filing on Friday with the Hong Kong stock exchange. Greentown said it would use the proceeds to refinance its debt and buy some of its outstanding notes.

While the domestic bond issuance market has “stayed somewhat open for selected developers throughout”, Greentown’s deal was the first of its kind by a Chinese home builder since a property crisis kicked off a few years ago, which could help “boost its liquidity and provide headroom for new investments”, S&P Global Ratings analysts said on Friday.

“The proposed issuance could also give Greentown more headroom for new investments,” the analysts said, noting that while nationwide property sales dropped 17 per cent from a year earlier in 2024, the company’s decline was around 6 per cent.

“This could support its strategy to focus on high-quality residential products in higher-tier cities in China. The strategy has helped Greentown outperform its peers in terms of sales.”

In a separate statement published on Thursday, Greentown said it had begun purchasing two outstanding bonds worth a total of US$741 million, both of which were due this year.