Powerlong issues RMB2.7 billion bonds in mainland China, while Savills further explores the financing market

22 January 2016

Powerlong Real Estate Holdings Limited (HK. 1238) recently announced that Shanghai Powerlong Industrial Development Co., Ltd., a wholly-owned subsidiary of the company, has completed the issue of the First Tranche Corporate Bonds to qualified investors in mainland China. This was completed with an aggregate principal amount of RMB2.7 billion, an increase from a planned RMB1 billion due to buyers’ enthusiasm.

This successful issuance reflects investors’ confidence in the strength and potential of Powerlong Real Estate, additionally marking an important step of the company into the mainland financial market. Powerlong believes that the issuance will optimize the financing structure of the company and help to keep overall financial costs at a reasonable level. The diversification of financing strategies is expected to contribute positively to the development and operation of prime real estate projects. Savills has been entrusted by Powerlong Real Estate to provide valuation services for commercial properties involved in the transaction.

Hoi Wa Fong of Powerlong Real Estate Holdings Limited comments, "Our successful issue should be attributed to the Savills Shanghai valuation team who has spent the past year valuing our assets by incorporating Chinese and international valuation standards in light of the mainland bond issue regulations. We really appreciate the professional and dedicated services of Savills China valuation team."

Albert Lau, CEO of Savills China states, "We are delighted to work with Powerlong Real Estate once again, and we congratulate the company on its first issue of corporate bonds in the mainland market. Its success in doing so as a HK Exchange listed company marks a milestone in the internationalisation of Chinese enterprises."

Charles Chan, Managing Director of Savills Greater China Valuation and Professional Services, says, "China’s real estate market is developing rapidly, narrowing the gap between China and mature international markets while placing stricter requirements on the provision of valuation services. We need to ensure that our valuation reports are not only recognised by local authorities, but also meet international standards."

Andrew Kam, Director of Savills Shanghai Valuation and Professional Services, comments, "As China loosens its control on financing and promotes the internationalisation of its currency, leading local developers have started to secure their real estate assets in the home market. Savills valuation and professional services have long enjoyed global prestige and are now recognized by the Chinese authorities. This, combined with extensive experience, will put us in a better position to support our clients in the growth of their business."

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Savills: Use double qualifications to continue cooperation and support clients’ growth

Powerlong Real Estate Holdings Limited specialises in the development and operation of large-scale, high-quality commercial complexes, with projects located all over China. In 2015 the company retained the second position among China’s top 10 commercial real estate enterprises for the fifth consecutive year. Supported by innovative operation, Powerlong Real Estate has recorded rapid growth in sales and rental revenue, as well as management fees, over the past three years. This, together with its well-performing assets, provides a solid foundation for its bond issue. Assessed by the United Credit Rating Company Ltd., a rating agency, the company has received an "AA+" rating, and its Corporate Bonds have received an "AA" rating. Savills first worked with Powerlong Real Estate when it assisted the company in being listed on the Hong Kong Stock Exchange in 2009. In 2014, Savills became one of the few professional valuation agencies with both domestic and international qualifications after receiving a Grade 1 qualification in Real Estate Valuation by the Ministry of Housing and Urban-Rural Development Department.

 
 

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