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Plans for Greenland’s Metropolis project looked simple enough back in 2014 (Getty Images)
Struggling to repay bond investors, Greenland Holdings has sold a 59-storey Los Angeles residential tower, the centrepiece of the Chinese developer’s first-ever US project, to American apartment operator Northland for $504 million.
The transaction for the 685-unit THEA at Metropolis in downtown LA marks one of the biggest single-asset multifamily acquisitions in US history, Northland said Tuesday in a release, with the price representing a more than 27 percent discount to the $695 million that Greenland was asking for the tower as recently as 18 months ago, according to an account in the Wall Street Journal.

“In THEA, Northland secured an extraordinary opportunity to acquire the highest quality luxury apartment tower in the United States at a steeply discounted price,” Northland CEO Matthew Gottesdiener said without making reference to Greenland as the seller. “The building’s spectacular design, condo execution and unparalleled amenities offer residents a next-level experience that will hold the test of time.”
THEA forms part of the 6.3 acre (2.5 hectare) Metropolis mixed-use development, consisting of the rental tower, two condo buildings and a hotel. The $1 billion project has become an albatross for Greenland as the Shanghai government-backed builder reckons with more than $2 billion in offshore debt coming due by mid-2023.
The $504 million price for the property values the multifamily units at $714,000 each and $688 per square foot, a 40-45 percent discount to replacement costs, according to Northland. The asset also includes 30,000 square feet (2,787 square metres) of ground floor retail.
Greenland Group boss Zhang Yuliang won’t win any more prizes for his record of cross-border deals (Getty Images)
Massachusetts-based Northland, which operates as a real estate private equity firm, acquired THEA without any partners, investing through discretionary funds and financing the purchase with 10-year fixed-rate debt
Greenland’s 2013 purchase of the Metropolis project from the California State Teachers’ Retirement System was one of the early milestones in an outbound real estate investment wave that put the developer onto a global stage. But by 2018 the group was already marketing the then-condo tower, the tallest and final building in the development, for a reported asking price of $450 million amid disappointing sales and China’s crackdown on capital outflows. The Shanghai-based firm has not issued a statement on the disposal and had not responded to inquiries from Mingtiandi by the time of publication.

Greenland continues to own the Hotel Indigo at the Metropolis, an 18-storey, 350-room property operated by InterContinental Hotels Group. The developer put the hotel on the market this year for a second time, according to local media accounts, after reportedly shopping the building for $280 million back in 2018.
Earlier this month, S&P Global Ratings downgraded Greenland to CC from CCC- and its senior bonds to C from CC. The agency regards a plan by the developer to extend the maturity of nine of its offshore bonds as “tantamount to a default”.
In March, Reuters reported that Greenland had scrambled for funds late last year to pay a $500 million offshore bond that came due in December. The company was rescued after Shanghai authorities told local state-owned enterprises to step in and buy new Greenland debt, Reuters said, citing sources who spoke to the news agency.
The near default didn’t prevent Greenland from reappointing founder and chairman Zhang Yuliang, 66, to a fresh four-year term in February. The Shanghai native became a rare example of an executive in China’s state sector to extend his tenure deep into his sixties.

Zhang has spent 2022 selling off Greenland’s portfolio of foreign assets, including with the February disposal of the final two phases of the Ram Quarter project in London that the group had purchased for £135.7 million ($184 million) in 2014.  The last pieces of the Metropolis project and some elements of the Pacific Park complex in Brooklyn are all that remain from a series of Greenland US acquisitions from 2013 to 2017, with the company having sold off a Bay Area site in June 2018 without breaking ground, before selling off three plots in Pacific Park in October that year.
In June, Greenland sold its strata-titled Lachlan’s Square Village mall in the Sydney suburb of Macquarie Park to Australia’s Revelop for A$30 million ($21.6 million), with the property forming part of Greenland’s A$800 million NBH at Lachlan’s Line mixed-use development.
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