Evergrande's Hong Kong headquarters worth $1 bn taken over by a receiver

China Evergrande Group’s Hong Kong headquarters building has been taken over by a receiver, according to a document from the Companies Registry, confirming previous reports that the developer had lost control over the tower worth more than $1 billion.

Alvarez & Marsal Asia Ltd. has become the receiver controlling the China Evergrande Centre in the Wan Chai area, the record shows. It is unclear from the document who appointed Alvarez & Marsal. 

The Financial Times last week reported that a lender had seized the property, adding that the embattled Chinese developer had pledged the building for loans from a consortium of lenders led by China Citic Bank International. The property was used as security for HK$7.6 billion ($968 million) in loans made by parties including Citic Bank International in 2020, separate documents at the Companies Registry website show.

Evergrande is at the center of a credit crisis that has rippled through China’s real estate sector and curtailed growth in the world’s second-largest economy. The developer failed to deliver a preliminary restructuring plan for its offshore debt that it had promised by the end of July, and has since said it would try to announce a specific proposal before the end of the year.

The 26-storey office building close to the city center is among Evergrande’s most valuable assets in Hong Kong. The developer has failed to sell the building at least twice as it rushes to raise cash.