The fact that these real estate businesses are forced to transfer or divest capital from real estate projects in order to restructure debt has made the real estate market in the city become more vibrant recently.
VRC Real Estate and Investment Joint Stock Company is transferring part or all of the compensated land area of an urban area project in Nha Be district. It is expected that the company will get at least 747 billion VND (about 30 million USD) after the transfer.
Previously, VRC also approved the transfer of part of the ADC residential project in District 7 for a price no lower than 800 billion VND (32.1 million USD).
The transfer amount is expected to supplement capital needs for VRC's business activities, in the context that this enterprise cannot pay the 47.3 billion VND of principal of the bond batch that matured in April.
Similarly, Hai Phat Investment Joint Stock Company also decided to divest 19.93% of charter capital (equivalent to more than 190 billion VND) at Hai Phat Thu Do Investment Joint Stock Company. At the same time, this company also transferred all 14.02% of charter capital at Civil Engineering Construction Corporation No.5 (equivalent to contributed capital of 83.5 billion VND).
The proceeds help Hai Phat supplement business capital and reduce financial pressure from bond debt and bank loans. Previously, the Hanoi Stock Exchange said that by the end of 2023, Hai Phat still had outstanding debt of 1.49 trillion VND (60 million USD).
The Board of Directors of Development Investment Construction Joint Stock Corporation (DIG Corp) also approved the transfer of part of the Vi Thanh Commercial Residential Area project in Hau Giang province and part of the Cap Saint Jaques Complex project in Ba Ria-Vung Tau province.
Besides transferring and divesting capital, some real estate companies also promote debt restructuring through agreements with bondholders.
Novaland Group said it had completed an agreement to restructure a bond package worth nearly 300 million USD with an interest rate of 5.25% (maturing in 2026) with the right to convert into common shares.
In addition, at the end of June, Novaland agreed to extend eight bond packages with a total issuance value of nearly 3.11 trillion VND (124.9 million USD), changing the bond term to 60 months to mature from June to August 2025.
The group's subsidiaries also reached similar positive agreements.
The completion of the restructuring of bond lots and many positive signals about liquidity would help the group reduce financial pressure that affects Novaland's business operations. From there, it was creating favourable conditions for the company to recover and time to balance cash flow and stabilise business operations.
In recent times, many businesses have found ways to extend or postpone bond payments. However, the pressure of maturing bonds is still very present and is one of the challenges for this industry's recovery process this year.
According to the Vietnam Bond Market Association (VBMA), in the second half of 2024, it is estimated that about 140 trillion VND (5.6 billion USD) of bonds will mature. Of this amount, the majority are real estate bonds worth about 60 trillion VND, equivalent to 42% of the total. In June, businesses bought back 13.3 trillion VND of bonds before maturity, down 68% compared to the same period in 2023./.VNA