One of China’s struggling property developers, Soho China, is offering a 30% discount on 32,000 square meters of commercial and residential properties in Shanghai and Beijing, reports Caixin. The money raised from sales will be used to repay debts, according to Pan Shiyi the company’s Chaiman. Buyers will be required to pay in full, and mortgage loans won’t be accepted.
To encourage agents to sell the properties, Soho China raised the commission bonus to 4% of transaction value, much higher than the industry average. Commissions for commercial properties are typically 1% of transaction value, according to a commercial property analyst.
One apartment in the first batch of listings, in Beijing Sanlitun Soho, is priced at RMB 49,000 ($7,750) per square meter, compared with RMB 60,000–80,000 per square meter currently being asked by sellers of similar units in the same building. Pan said some of the company’s debts are about to mature. At present, Soho China’s net assets-to-debt ratio is about 44%, a relatively low level in the industry.