Country Garden, the indebted Chinese developer listed on the Hong Kong Stock Exchange as 2007.HK, has recently taken a strategic step towards divesting from its Australian ventures. The company has agreed to sell a stake in an Australian residential project, marking the latest move in a series of sales that signal its gradual withdrawal from the country.
The Australian subsidiary, Risland, has entered into an agreement to sell its partial interest in the majority of the Wilton Greens development. Spanning 330 hectares and located approximately 65 km southwest of Sydney, the project has faced challenges since its launch in 2019 as a A$2 billion ($1.31 billion) development comprising 3,600 homes on the outskirts of Sydney. Delays in construction have been a recurring issue, with fewer than 50 homes under construction as of October. Risland’s CEO, Guotao Hu, emphasized the significance of the divestment in a statement reviewed by Reuters, stating that it allows Risland to rebalance its portfolio and actively pursue new opportunities in the crucial Australian market.
Facing financial pressures amid a broader debt crisis that hit the Chinese real estate sector in mid-2021, Country Garden has been among the developers grappling with a cash crunch. The South China Morning Post reported that the stake in Wilton Greens was sold to Avantaus for $157 million, although Risland and Avantaus have not provided immediate responses to inquiries about the sale price and buyer’s identity, respectively. This divestment aligns with Country Garden’s broader strategy to streamline its overseas assets. In October, the developer sold Windermere, a residential site on the outskirts of Melbourne, marking one of its last assets in Australia.
As part of its ongoing efforts to address financial challenges, Country Garden revealed this week that it has appointed KPMG Advisory (China) Ltd as its principal financial adviser for offshore debt restructuring. This move underscores the company’s commitment to engaging reputable financial institutions for expert guidance in navigating its complex financial landscape.
