The Shanghai-based real estate company completed a one-year maturity extension on $500 million in senior unsecured notes, prompting S&P to regrade it one notch higher to “CCC”.
The rating agency said at that time it viewed the proposal to extend the maturity as “a distressed debt restructuring and tantamount to a default”.
On Wednesday, while upgrading Greenland rating on completion of the maturity extension, S&P said the developer continued to face heightened repayment risk owing to a significant amount of debt maturities in 2022 and its “exceptionally weak” liquidity.
Greenland declined to comment on the latest rating action. Its shares rose 3.6% in Shanghai trading on Wednesday.
“Repayments for Greenland’s remaining US dollar-denominated senior notes due in 2022 are subject to high uncertainty, in our assessment,” the rating agency said in its note.
Over the next 12 months, Greenland has offshore debt maturities of about $2.4 billion, as per S&P estimates. Greenland’s repayment ability will largely depend on cash collection from sales and asset disposals, it said.
A string of Chinese property developers have defaulted on their offshore debt obligations and have had their ratings slashed in the last year as a result of an unprecedented liquidity squeeze and slowing sales.
S&P said the homebuilding and real estate sector now leads the global corporate tally with seven defaults.
- Reuters, with additional editing by George Russell