Asia market round up: China real estate mark-down

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Asia market round up: China real estate mark-down

If Japan’s property bubble has already expanded and popped, China’s might be close to bursting.

That at least is the view of Walter Molano at US firm BCP securities, in his March report, The property buzz in China. "The equity share prices of large property developers, such as Shimao, Agile and Hopson, are down more than 50%," he writes. "The spread on some property developers’ bonds, such as Greentown and China Properties, are wider than 1,300bp over treasuries. Some of these assets are pricing default probabilities of more than 70%." Molano goes on to argue that there are excellent opportunities among the detritus, since the market has been the victim of somewhat indiscriminate selling. It’s a market worth considering if the opportunity to buy a Tokyo bank HQ doesn’t sound enticing...

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