High-yield USD-bond deals from Chinese property developers have attracted strong order books so far this year amid a relatively lower supply due to the COVID-19 crisis.

At least 10 deals from the sector YTD have received 10x or more orders on their respective issue sizes, while only five deals registered such an order book multiple in entire 2019. On average, the order book multiple from the sector so far in 2020 was 6.28x, higher than the 4.13x for the whole of 2019.

The highest multiple this year was for Hong Yang Group’s Redsun  Properties’ USD 300m 9.70% due-2023 deal, which received 15.83x orders. Zhenro Properties’ USD 200m 8.30% due-2023s and Modern  Land’s USD 200m 11.80% due-2022 were subscribed 14x and 13.5x, respectively.

The last deal to draw 15x-plus orders before Redsun’s offering was Ronshine  China’s USD 207.76m new-money portion of its USD 600m 11.25% due-2021s priced in February 2019. That deal received 15.4x orders.

Among the top 10 deals that received the largest order book multiples this year, four were priced between 4 June and 7 July: Zhenro’s due-2023s, Shimao Property’s USD 300m 4.60% due-2030s, China  Fortune Land Development’s USD 300m 6.92% due-2022s and Greentown  China’s USD 300m, 5.65% due-2025s.

The overall HY USD issuance volume from the Chinese property sector was down 28.5% YoY YTD. Volumes from the sector were only USD 287m from two issuers in April, down 96.66% YoY, then USD 1.6bn from seven issuers in May, also a 26.62% decline YoY, before recording a decent USD 5.77bn from 22 issuers in June, still a 12.11% YoY fall.

Jason Huang-Jones APAC Data Manager Debtwire