China property developers Sunac, CIFI say projects get local govt support

HONG KONG: Chinese property developers Sunac China and CIFI Holdings said some of their projects had been listed by local governments as suitable for loans, adding to the number of defaulted developers getting support from authorities.

China’s largest private property developer Country Garden , which defaulted on its offshore debt late last year, said on Saturday more than 30 of its projects had been listed as suitable for financing support from local governments.

Under the “project whitelist” mechanism launched on Jan. 26, governments of 35 cities across the country are gearing up to recommend to banks residential projects that need financial support, as authorities aim to inject liquidity into the crisis-hit sector.

Sunac, which completed a $9 billion offshore debt restructuring last year, said in a statement to Reuters on Monday that more than 90 of its projects had been added included to whitelists from cities including Beijing, Tianjin, Chengdu and Chongqing.

“As the financing comes in place, the cashflow pressure of the development and operation of Sunac projects would be eased, which will further ensure the work of ‘home delivery’ in different cities,” the developer said.

CIFI, another big developer that is now working on an offshore debt restructuring, said in a statement on Sunday that 18 of its projects had been whitelisted by local authorities, including the cities of Chongqing, Beijing, Tianjin and Wuhan.

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Shares of Country Garden firmed as much as 4.8% on Monday morning in early trading, while Sunac and CIFI rose 3.6% and 5.8%, respectively, before pulling back in mid-morning trade.

China aims to ramp up financing for residential projects in the coming days as part of its support measures for real estate firms, but banks’ reluctance to lend to the sector will remain a major obstacle for the distressed developers that need fresh funding the most.