BEIJING: According to recent reports, Goldman Sachs has expressed optimism for high-yield US dollar bonds issued by Chinese real estate companies, as the business outlook in China’s real estate sector continues to improve.
This comes as China’s new home sales rose for a second straight month in March, which indicates a revival in the country’s real estate sector.
This revival has been fueled by a series of measures introduced by Chinese regulators starting late last year.
Head of Asian fixed income at Goldman Sachs Asset Management, Salman Niaz, said: “In our view, there are currently high-return opportunities from private real estate developers – both from those companies that have not defaulted and from those who have defaulted.”
In addition to the rise in home sales, there has been progressing in debt restructuring for major real estate companies.
Companies such as China Evergrande and Sunac China have recently announced agreements with a group of overseas creditors on an overseas debt restructuring plan.
The positive outlook on China’s real estate market has led to predictions from industry experts such as Niaz, who suggests that companies with large, diversified businesses, operations in high-quality cities, and strong management teams will generate better returns for credit investors.
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