Chinese property developer Longfor Group said its 1.5 billion yuan ($219 million) bonds had been priced at a coupon rate of 3.3%, marking the first sale by a private Chinese homebuilder of notes fully guaranteed by the state-owned China Bond Insurance Co. Ltd.
Longfor’s three-year notes, priced at the lower end of an indicative range of 3% to 4.3%, were oversubscribed by 2.86 times, the company said.
CIFI Holdings is also planning to sell 1 billion to 1.5 billion yuan of three-year medium-term notes in September at a coupon rate of 3%-4.5%, which will guaranteed by China Bond Insurance, and the proceeds will be used for project development and debt repayments, the term sheet shows, according to a term sheet.
“It shows debt guarantee and credit enhancement is an important element for bond issuance now,” said Yan Yuejin, research director of E-House China R&D Institute. “Other property developers will become more active to issue bond.”