China’s Oceanwide sells San Francisco property project at loss

Golden Gate bridge, San Francisco, United States. Photo: Pixabay

China’s Oceanwide Holdings Co. has sold its San Francisco property project for about $1 billion, taking a loss on an ambitious development that was expected to include the city’s second-tallest office tower but has lain idle for months.

The Oceanwide Center site, which includes offices, upscale condos and a Waldorf Astoria hotel, faced “huge challenges” on construction and cost controls, the company said in a filing to the Shenzhen stock exchange late Wednesday.

It expects to take a loss of about $276 million on the project, it said. The buyer was named as a unit of SPF Capital International Ltd., but no further details were given.

Work on one of the San Francisco towers was halted in October. Oceanwide is also struggling to complete a project in Los Angeles that has been plagued by lawsuits from subcontractors and as the Chinese government cracks down on capital leaving the country.

The disposal of the troubled project is Oceanwide’s first retreat from the U.S. since it hit financial challenges in mid-2018, caused in part by $1.1 billion of acquisitions during an overseas buying spree by Chinese firms.

Still, the sale will “substantially improve” cashflow and alleviate overseas’ business risks, Oceanwide said in the filing. The developer is set to get 4.4 billion yuan ($635 million) in the short term and more in future instalments, it said.

Oceanwide also has projects in New York and Hawaii. The developer bought 80 South Street in lower Manhattan in 2015 for $390 million and planned to build a mixed-use high-end condominium and hotel. Progress stalled after there were problems with plans to demolish some existing buildings.

Outside real estate, Oceanwide is still in a prolonged process of buying U.S. insurer Genworth Financial Inc.

Bloomberg

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In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

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  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.