Cash-Strapped R&F Vows to Sell Assets as Cash Shortfall Widens

00:00

00:00/00:00

Listen to this article 1x

R&F has been mired in a debt crisis during China’s prolonged property market rout

Guangzhou R&F Properties Co. Ltd. said it will continue offloading assets to repay debts as the embattled developer grapples with a deepening liquidity crunch amid China’s prolonged housing market slump.

Hong Kong-listed R&F reported total assets of 312.2 billion yuan ($43.8 billion) and total liabilities of 268 billion yuan by the end of the first half, resulting in a debt-to-asset ratio of 85.84%, according to its interim report released Thursday.

You've accessed an article available only to subscribers

Subscribe today for just $.99.

VIEW OPTIONS

Download our app to receive breaking news alerts and read the news on the go.

Get our weekly free Must-Read newsletter.

Share this article

Open WeChat and scan the QR code

DIGEST HUB

Digest Hub

Back

Explore the story in 30 seconds

Guangzhou R&F Properties faces a severe liquidity crunch with total liabilities of 268 billion yuan and cash reserves of only 5 billion yuan.
The company reported a 60.5 billion yuan cash shortfall for short-term liabilities and defaulted on 27.7 billion yuan in loans, triggering cross-defaults on an additional 81.4 billion yuan.
R&F continues asset sales to manage debts, reducing its net loss by 53% to 2.3 billion yuan in H1 2024, despite a significant dip in revenue and sales.

AI generated, for reference only

Who’s Who

Guangzhou R&F Properties Co. Ltd: Guangzhou R&F Properties Co. Ltd., facing a deepening liquidity crisis, plans to continue offloading assets to repay debts. By mid-2024, it reported assets of 312.2 billion yuan and liabilities of 268 billion yuan, with significant short-term debt and a cash shortfall of 60.5 billion yuan. Established in 1994, R&F was once a leading developer but has struggled with falling sales and dwindling cash flow, necessitating asset sales and debt restructuring efforts.

Agile Property Holdings Ltd.: Agile Property Holdings Ltd. is mentioned in the article as one of the "Five South China Tigers," alongside Guangzhou R&F Properties, Country Garden, China Evergrande Group, and Hopson Development. These companies were once the leading property developers in southern China.

Country Garden Holdings Co. Ltd.: Country Garden Holdings Co. Ltd. is one of the major developers in southern China and was part of the "Five South China Tigers" along with Guangzhou R&F Properties Co. Ltd., Agile Property Holdings Ltd., China Evergrande Group, and Hopson Development Holdings Ltd.

China Evergrande Group: China Evergrande Group is mentioned in the article as one of the "Five South China Tigers" along with Guangzhou R&F Properties, Agile Property Holdings, Country Garden Holdings, and Hopson Development Holdings.

Hopson Development Holdings Ltd.: The article mentions Hopson Development Holdings Ltd. as one of the "Five South China Tigers," along with Guangzhou R&F Properties Co. Ltd., Agile Property Holdings Ltd., Country Garden Holdings Co. Ltd., and China Evergrande Group. These companies were historically some of the biggest developers in southern China.

Sunac China Holdings Ltd.: Sunac China Holdings Ltd. is mentioned in the article as a larger rival to Guangzhou R&F Properties Co. Ltd. In 2017, Sunac joined R&F in a $9 billion debt restructuring deal for the Wanda Group, helping to address its liquidity issues caused by regulatory crackdowns.

Dalian Wanda Group Co. Ltd.: Dalian Wanda Group Co. Ltd. is a company that faced a regulatory crackdown and liquidity crunch, leading to a $9 billion debt restructuring deal in which R&F Properties and Sunac China Holdings Ltd. participated as white knights. R&F bought over 70 hotels from Wanda for 19.9 billion yuan in 2017, which significantly increased its debt.

R&F Properties (HK) Co. Ltd.: R&F Properties (HK) Co. Ltd., a wholly owned subsidiary of Guangzhou R&F Properties, received a winding-up petition in August due to unpaid debt. The case is set to be heard by a Hong Kong court on October 30.

AI generated, for reference only

What Happened When