Schroders’ losses underscore the increasing strain global firms face from Hong Kong’s slumping property market. Like many other financial sponsors, Schroders uses special purpose vehicles to act as borrowers for loans against its Hong Kong property assets.
Schroders Plc has become the latest global asset manager to be caught up in Hong Kong’s commercial property meltdown.
Within just a few months, two assets managed by its property investment arm have been seized by bank creditors. Now it faces a new challenge relating to a loan for a three-floor commercial space at Harbourfront Landmark in Hong Kong’s Hung Hom district. The facility was not repaid on the original maturity date. The lender, Bank of Communications (Hong Kong) Ltd., is now weighing various options for the loan including potentially demanding immediate repayment and then enforcing it, according to people familiar with the matter. No final decision has been made, they added.
