Foreign Property News | Posted by Hnin Ei Khin
China’s embattled HNA Group is continuing its series of asset disposals as the conglomerate’s aviation and tourism arm agreed to sell a Beijing office complex to China Vanke for RMB 1.29 billion ($190 million).
A notice filed with the Shanghai stock exchange over the weekend by Hainan Airlines, the primary air carrier of the transportation-based group, documented the company’s disposal of Beijing HNA Plaza, a 39,000 square metre (420,000 square foot) development at 2 North East Third Ring Road in Chaoyang district.
The filing said that the sale would generate net income of RMB 557 million for the airline.
The sale is HNA’s third disposal of a mainland asset for $45 million or more in the last 45 days, a period in which the group also defaulted on a pair of debt obligations as it struggles for liquidity.
At RMB 1.29 billion, HNA disposed of the two building complex at RMB 39,000 per square metre, a price well below comparable transactions in the area.
Commenting in local business publication Jiemian, an analyst from Cushman & Wakefield noted that similar office buildings on Beijing’s third ring road near HNA Plaza have an average asking price of RMB 80,000 per square meter, and that available stock was hard to come by.
The below market deal for the 2009-vintage property led to speculation that Vanke may be taking over some debt liabilities associated with the asset, in addition to its equity payment.
An asset valuation document referenced in the transaction filing showed that at the end of August, the special purpose vehicle which held Beijing HNA Plaza was valued at RMB 1.29 billion.
Ref : Property Report
