On December 23, SUNAC China Holdings Limited (01918.HK) announced that its offshore debt restructuring plan has officially taken effect. This marks the complete resolution of debt risks at the listed company level, laying a solid foundation for SUNAC's comprehensive operational recovery.
This year has seen accelerated progress in debt restructuring across the real estate sector. According to incomplete statistics, 21 distressed developers have completed debt restructuring or reorganization, with total resolved debt amounting to approximately RMB 1.2 trillion. As the first major developer to achieve full-scale domestic and offshore debt restructuring, SUNAC has set an innovative and win-win precedent, offering a benchmark for industry-wide debt resolution.
Industry experts note that SUNAC’s debt restructuring approach represents a proactive and pioneering effort amid market volatility. It reflects the developer’s commitment to navigating complex debt solutions to restore normal operations and growth in a rapidly changing market environment. Analyzing SUNAC’s path provides valuable insights for assessing industry risk mitigation and guiding future debt resolution strategies for other developers.
**Systematic Breakthrough: A Model for Industry Risk Resolution** After three years of deep adjustments, the real estate sector has reached a consensus: resolving debt risks is a prerequisite for restoring healthy operations. SUNAC’s approach has been methodical—transitioning from emergency measures to fundamental solutions—all aligned with this core logic.
Initially, debt extensions were the preferred choice for developers seeking to "buy time." In early 2023, SUNAC successfully extended RMB 16 billion in onshore bonds, setting a precedent for policy-supported debt restructuring in capital markets and paving the way for broader debt resolution.
However, as the sector’s downturn deepened beyond expectations, with sluggish sales and constrained financing, developers faced mounting cash flow pressures, making extensions increasingly untenable. A fundamental solution became imperative, and debt restructuring emerged as the optimal path to sustainable operations.
SUNAC completed its onshore bond restructuring in January this year, adopting a market-driven approach. Concurrently, its offshore restructuring—one of the sector’s largest and most complex cases—progressed steadily, culminating in a 98.5% creditor approval rate, court sanctioning, and eventual implementation. This milestone marks the successful shedding of SUNAC’s debt burden.
SUNAC’s proactive stance and commitment to operational recovery earned significant creditor trust, a critical factor in its success. Its innovative restructuring frameworks have since been widely emulated, accelerating industry-wide risk resolution.
Notably, SUNAC’s major shareholder aligned its interests with the company, providing personal guarantees for onshore bond extensions and converting $450 million in interest-free loans into equity under the same terms as creditors. This shared-risk approach was pivotal in securing restructuring approval.
With the real estate sector yet to fully stabilize, SUNAC’s success has bolstered market confidence. "SUNAC has delivered a comprehensive debt resolution blueprint," remarked an analyst, highlighting its balanced approach to sustaining operations and protecting stakeholder interests—a model with far-reaching implications for industry recovery.
**A New Chapter: Steady Progress Toward Sustainable Growth** For SUNAC, debt restructuring not only eliminates historical liabilities but also reactivates core operational capabilities, marking a turning point from risk resolution to value restoration.
The resolution of onshore and offshore debt—particularly the near-zero offshore debt—has established a sustainable capital structure, reducing SUNAC’s total debt pressure by approximately RMB 60 billion, strengthening net assets, and enhancing financial stability.
This success has reinforced stakeholder confidence, facilitating further risk mitigation and asset revitalization across SUNAC’s projects, and supporting long-term credit and operational recovery.
Operational momentum is now accelerating, creating a virtuous cycle of synergies. SUNAC is on track to deliver over 50,000 new homes this year, bringing its four-year total to 700,000 units—the first among peers to complete all guaranteed deliveries, significantly boosting market confidence.
Debt resolution has also underpinned SUNAC’s project revitalization and sales resurgence. Amid intensifying competition, SUNAC’s premium assets and product strength have reclaimed market leadership, with its flagship "One Park" series driving sales nationwide.
- Shanghai One Park achieved annual sales exceeding RMB 22 billion, ranking as China’s top-selling single project. - Beijing SUNAC One Park ranked among the top three in Beijing’s RMB 30 million+ luxury home sales (Jan-Nov). - Tianjin Meijiang One Park Phase 2 led its segment (200㎡+, RMB 8 million+) in November. - Wuhan Optics Valley One Park sold nearly 90% of its 107 units on launch day.
With a land reserve exceeding 124 million square meters—70% in tier 1-2 cities—SUNAC is well-positioned for future asset revitalization. Projects like Chongqing Bay will debut next year, further enriching its portfolio of benchmark developments.
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