Posted Jan 29, 2019, 2:29 AM
|
 |
Registered User
|
|
Join Date: Dec 2016
Location: San Francisco
Posts: 24,177
|
|
Some more information on the situation with Oceanwide Holdings:
Quote:
Chinese developer behind one of San Francisco's largest projects stalls Los Angeles towers
By Blanca Torres – Reporter, San Francisco Business Times
Jan 28, 2019, 11:20am PST Updated 5 hours ago
Some real estate and financial analysts have argued that the developer is overleveraged. Oceanwide Holdings is a publicly traded Chinese conglomerate with various subsidiaries under the parent company China Oceanwide.
Amy Jalili, a spokeswoman for Oceanwide Center, said that construction is continuing and that the San Francisco project should be ready for the foundation to be poured this summer . . . .
The company jumped into the U.S. development market with Oceanwide Plaza and later bought sites for Oceanwide Center in San Francisco as well as a 1,400-room hotel on the island of Oahu in Hawaii, and two high-rise sites in New York City. The Hawaii and New York sites have yet to start construction . . . .
Hindenburg Research, a financial research firm, issued a report in November analyzing the firm’s recent acquisition of Chinese insurance company Genworth. The report states that Oceanwide had debts of $31.165 billion in 2017, compared with $20 billion in 2015 and $8.95 billion in 2013, while reporting $3.415 billion in revenue in 2017. The company also listed $11.4 billion in development costs as assets.
Nathan Anderson, head of Hindenburg Research, said Oceanwide depends on regularly securing credit. With China’s credit markets tightening, that could prove challenging in the future.
S&P Global Ratings last year gave Oceanwide a CCC+ rating, below investment grade. Last week, S&P said Oceanwide’s agreement to sell four land sites in Beijing and Shanghai “will provide the company with much needed liquidity and lower its debt burden. We believe this sale is a meaningful first step for Oceanwide toward a capital structure that can be sustained over the long term.”
“In an effort to prioritize construction activity, and while we restructure capital for the project, interior construction at Oceanwide Plaza is temporarily on hold,” Oceanwide said in its statement, according to the Los Angeles Times. “With more than $1 billion of equity already invested in Oceanwide Plaza, we look forward to investing more capital into the property and together with Lendlease, remain committed to building this landmark project for LA” . . . .
|
https://www.bizjournals.com/sanfranc...t-housing.html
I interpret all that to be saying that Oceanwide Holdings is, indeed, over-leveraged and that they are attempting to correct the situation by selling the Beijing/Shanghai properties. Once that is accomplished (or perhaps once they secure bridge financing in anticipation of that), they will resume work in LA. Meanwhile there seems to be no indication that they lack enough cash to proceed in San Francisco (at least none of the Americans involved with the project, including architect Jeffrey Heller, will say there's to be any SF slowdown). Perhaps since the LA project is topped out they just consider it a more appropriate time to suspend the work there.
|
Prev
Linear Mode
