HNA Announces Rmb 1.39b Sale Of Shenzhen Commercial Project

Continuing an asset disposal plan that aims to sell off as much as $11 billion worth of real estate by the end of 2019, HNA Infrastructure Investment Group, an affiliate of the troubled mainland transportation conglomerate, this week announced that it is selling a Shenzhen property for RMB 1.39 billion ($200 million).

The disposal of the 143,300 square metre (1,542,468 square foot) Shenzhen Haihang City project was announced by HNA Infrastructure to the Shanghai Exchange in a statement which specified the buyer as Tianji Wealth Group, a local investment management firm.

Tianji Wealth Group had been reported in July as purchasing the project for RMB 1.6 billion, with the final sale price coming in at some RMB 215 million lower than had been reported three months ago. The Shenzhen-based firm had launched a RMB 1.6 billion private equity fund around the time of the Shenzhen Haihang City transaction first being reported, with the specific purpose of acquiring the asset.

The latest domestic disposal comes after HNA, which had debts listed at $96 billion at the end of June, put a list of 89 properties on the market in early October worth a total of $11 billion.

“Real estate is now a non-core business for HNA, and a luxury which the company can no longer afford. Confronted with such massive debt, and strongly advised by Beijing, HNA seems willing to divest all such non-core assets, and all offshore assets as well,” said Brock Silvers, Managing Director at China-based Kaiyuan Capital.

In August this year, the Hainan-based company sold the site of its original headquarters, Wang Hai Technology Plaza in Haikou, to Tianjin-based developer Sunac China for RMB 981 million. Shortly after the disposal in its hometown, HNA was agreed to sell a Beijing office complex to China Vanke for RMB 1.29 billion. However, the transaction was rejected by its shareholders last week.

Shenzhen Haihang City is a 143,300 square metre commercial complex located in northeastern Shenzhen’s Longgang District, and involves residential, office, retail, and serviced apartments in the four-phase project.

Ref: Property Report