Chinese tycoon Chen Hongtian faces demands on more than US$200 million of overdue property-related loans
Nanyang Commercial Bank has demanded payment from Chen Hongtian, chairman of Hong Kong-based Cheung Kei Group, and his wife, Chen Li Ni Yao, on five overdue term-loan facilities totalling HK$799 million (US$102 million), including default interest, according to a writ dated April 17.
Each has provided personal guarantees for the loans and has agreed to be liable independently to pay for all sums guaranteed, according to the writ. The term loans dated 2017 all have a five-year tenor and were outstanding as of March 8.
Chen has lost at least US$1.4 billion worth of properties to creditors, both in Hong Kong and London, according to data compiled by Bloomberg, plagued by what he has called “short-term liquidity issues” at Cheung Kei Group, which acquires and operates real estate assets globally.
Among these properties, creditors have put up for sale a US$892 million office tower in Hong Kong’s Hung Hom area and two buildings at Canary Wharf in London.
Chinese tycoon Chen Hongtian has Hong Kong property seized by lenders
Chinese tycoon Chen Hongtian has Hong Kong property seized by lenders
The latest lawsuit from Nanyang Commercial Bank followed a separate demand by United Overseas Bank last month seeking payment of loan principal and unpaid interest, plus default interest, totalling HK$848 million. Chen, his wife and his son had made a similar personal guarantee for that loan, which was payable on March 21.
Cheung Kei Group did not respond to a request for comment and phone calls to its office went unanswered on Monday. Representatives from Nanyang Commercial Bank and United Overseas Bank did not respond to email inquiries.
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An ongoing downturn in office markets worldwide has weighed further on properties previously owned by Cheung Kei Group. Sales plans for 5 Churchill Place, one of the group’s investments at Canary Wharf, have been shelved, as interest rates remain high and vacancy rates shoot up.
The defendants have 14 days from the date of the writ to either satisfy the banks’ claims or to indicate to the court whether they would contest the proceedings or make an admission, according to the court filing.
