The Shanghai-based company said sales in May came to 2.92 billion yuan (US$402 million) worth of properties covering a total area of 229,177 square metres (2.47 million square feet), in a filing with the Hong Kong stock exchange on Friday.
That was about 12 per cent higher than the 2.61 billion yuan of properties spanning 203,099 sq m that Shimao recorded in April. Compared to May last year, however, sales fell by 27 per cent.
In the first five months of the year, Shimao shifted 13.78 billion yuan worth of properties, a 42 per cent slump from the 23.86 billion yuan of sales it reported in the same period of 2023.
Lat month the Chinese government launched a rescue package for the property segment with measures such that included a 300 billion yuan relending facility and cuts in mortgage rates.
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Chinese investors offloading overseas properties
Chinese investors offloading overseas properties
Beijing’s intervention in the property market did not immediately boost the fortunes of every developer, however.
“We assess that the policy support should help market sentiment and subsequently developers’ sales, but the impact may not be very significant,” said Raymond Cheng, managing director and head of China and Hong Kong research for CGS International, in a note on Friday.
Still, Cheng said developers “expect better month-on-month sales in June due to more project launches.”
“Sales for the second half of 2024 should also improve due to the low base last year,” he said.
However, there are risks that could hamper the improving fortunes of China’s developers, he warned. These include “weak implementation of the latest new policies and further declines in home prices.”
Shimao is facing a liquidation suit brought by China Construction Bank, the country’s second-largest lender, for a financial obligation amounting to HK$1.58 billion (US$202 million). In March, the company said it was seeking to restructure US$11.7 billion worth of offshore debt.