Xu Jiayan attended the 2015 Interim Results Conference of Evergrande held at the Four Seasons Hotel in Hong Kong.
Chinese real estate billionaire Xu Jiayin is under pressure to use his personal wealth to repay most of Heng Heng's huge debts. The embattled tycoon seems to have at least one thing by his side-a booming market, eager to buy ultra-luxury assets. Home is like his.
According to analysts and media reports, Mr. Xu, who now has a net worth of US$11.3 billion, still owns superyachts and private jets worth nearly US$300 million. According to media reports, he has mortgaged a luxury villa in Hong Kong, sold two Gulfstream jets for approximately US$50 million, and is looking for a buyer to buy a larger Airbus ACJ330 wide-body jet .
Analysts said that although hasty sales usually depress asset prices, the current demand for yachts and private jets is particularly strong as supply becomes increasingly scarce. Evergrande is now close to reducing its total liabilities to less than US$305 billion, and on Wednesday it paid another US$148 million in overdue bond interest, thus narrowly avoiding another default. This payment was issued before the 30-day grace period is about to end on November 10.
Fan Ruose, a professor of finance at the Chinese University of Hong Kong, said that “the outcome of the debt crisis will determine the fate of the Hui people” and that he “must be under the pressure of the party” to use his personal property to repay bonds. Although Chinese state media said Thursday that a blow to the real estate industry may be possible There will be some relief. The number of housing loans in October actually rose from last year, but Evergrande still has almost no chance to generate enough cash to repay debt because it borrowed too much money. Chuanyi Zhou, a credit analyst at Lucor Analytics in Singapore.
Zhou said that the final debt restructuring is still the most likely outcome. Evergrande also missed the initial interest payment of US$82.5 million on two US dollar-denominated bonds due on November 6th, and started a 30-day grace period, which will end on December 6. It must also pay another $255 million in bond coupons on December 28.
The company did not respond to an emailed request for comment, and it was unclear whether anyone had contacted Xu to purchase his remaining assets. But this embarrassed billionaire is certainly not without chips.
"The current market is very good," said David Yu, an adjunct professor of finance at New York University in Shanghai and chairman of China Aviation Valuation Consultants, the only professional aviation valuation consulting company in China. "Since Covid, private jets have been very popular because people don't want to use commercial jets."
Yu said that the Airbus ACJ330 jet, which was acquired for US$220 million a few years ago, has its own exclusivity. He said that the model has been used by heads of state for travel. Xu's jet plane consists of shower rooms, bedrooms and entertainment facilities, and it takes several years to manufacture. "There are special buyers looking for it," Yu said, adding that it is either a large enterprise or a very wealthy person who does not want to wait and may need it immediately.
Currently moored in Hong Kong, Xu's superyacht activity is another symbol of his wealth. According to data provider VesselsValue, the 60-meter ship was acquired in 2013 and is worth US$47.4 million.
VesselsValue superyacht director Sam Tucker said the billionaire has not publicly stated whether he intends to sell it, but there are many potential buyers, partly because of “wealth creation related to the very strong post-Covid global stock market. ".
"In the yacht industry, supply cannot respond quickly, so this additional demand puts upward pressure on value," Tucker said in an email. "We have seen unprecedented levels of transactions, and the transaction speed is about twice as fast as usual."