Gemdale Tells Creditors It Has Raised Most Funds for $480M Notes Due Aug. 12, Determined to Raise More to Redeem Notes On Time

Gemdale Group told certain creditors recently that it has raised most of the funds for its $480 million 4.95% notes maturing on Aug. 12 and is determined to raise more funding in order to redeem the notes on time, according to three sources familiar with the matter.

The Shanghai-listed developer with Shenzhen government backing indicated to investos that there is still a small funding gap as of this week, the sources said. Gemdale’s $480 million 4.95% due Aug. 12 notes were indicated around 97.75/ 98.75 today, July 18, according to two buysiders.

Gemdale also recently met with its largest shareholder Funde Sino Life Insurance Co. Ltd. – privately owned – to discuss potential funding assistance to address the due August notes, said one of the three sources and a fourth source familiar with the matter.

The company has been in talks with potential buyers to sell three of its U.S. assets with expected net proceeds for over $100 million, said one of the first three sources. It has also been in talks to potentially sell a commercial asset, jointly owned by Gemdale and other JV partners, in Shenzhen, said the same source.

On July 12, Gemdale announced that its joint venture company Link JV Holdings Ltd. has applied for a 575 million Chinese yuan ($79.3 million) 12-months loan with Standard Chartered Bank Hong Kong, in order to support the development of a project located in Minhang district in Shanghai.

Link JV Holdings Ltd. is a 50:50 joint venture between Gemdale’s Hong Kong-listed commercial arm Gemdale Properties and Apollo Asia Link Ltd. and the company has developed a project in Shanghai’s Minhang district with operating income generated from the project in the first half of 2024 about CNY 44.7 million and net profit of CNY 4.5 million.

The company has also recently sold its 51% stake in an urban renewal project in Pingshan district in Shenzhen to its joint venture partner Shenzhen Zhongzhu Property Management Co. Ltd., a local developer.

Gemdale did not respond to requests for comment as of press time.