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China Developer Shimao Misses $1bn Bond Repayment Deadline

The struggling real estate firm blamed “market uncertainties over debt refinancing” for being unable to repay its creditors in time

Shimao misses bond payment
The flag of property developer Shimao Group flutters next to a Chinese flag in Shanghai, China January 13, 2022. Photo: Reuters


Chinese real estate giant Shimao Group has missed an interest and principal payment on a US$1 billion offshore bond that was due on Sunday.

In what is just the latest blow to China’s embattled property market, Shimao was unable to pay a total of US$1.023 billion in principal and interest to creditors of a senior note listed on the Singapore Exchange.

The developer said, in a Sunday filing on the Hong Kong bourse, that “market uncertainties over debt refinancing” and “challenging operating and funding conditions” were to blame.

With a coupon rate of 4.750%, the bond matured on July 3, and the developer has not received notice of acceleration of repayment from its lenders, it said, suggesting the debtholders have not moved to take enforcement actions.


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Shimao hired Admiralty Harbour Capital as its financial adviser and Sidley Austin its legal adviser to help assess and explore ways to manage the liquidity crisis. 

Meanwhile, creditors of its two syndicated loans have agreed to give the cash-strapped Chinese developer a breather. 

Shimao said it has received written notice of support from the majority of the lenders of two syndicated loans agreed upon in 2018 and 2019, in which HSBC acted as the lead facilitator for dual currency loans. 

The creditors, who are “generally supportive of the company continuing to explore the possibility of an agreement and implementation of a potential restructuring with its relevant stakeholders,” are willing to allow Shimao to continue to run the business with minimum disruption, according to the filing. 


  • Reuters with additional editing by Sean O’Meara


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Sean O'Meara

Sean O'Meara is an Editor at Asia Financial. He has been a newspaper man for more than 30 years, working at local, regional and national titles in the UK as a writer, sub-editor, page designer and print editor. A football, cricket and rugby fan, he has a particular interest in sports finance.


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