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Photo courtesy of Yonhap News |
[Alpha Biz= Kim Jisun] A senior housing and healthcare development project in the Osiria Tourism Complex in Busan has secured 80 billion won ($60 million) in refinancing as it faces financial strain due to unsold units, while the construction arm of Hanwha Corporation remains unable to recover 138.8 billion won in unpaid construction costs.
According to investment banking sources on June 13, Suncity, the developer of the Osiria Meditown project, extended the maturity of its existing 170 billion won in debt to June 2028. Of this, 80 billion won was provided by a special purpose company (SPC) established by Kiwoom Securities and securitized through asset-backed short-term bonds (ABSTBs).
The Osiria Meditown project is a large-scale development located in Gijang-eup, Gijang County, comprising 574 senior welfare housing units, 408 assisted living units, a traditional medicine hospital, and neighborhood commercial facilities, with a total floor area of approximately 199,320 square meters.
The refinancing was backed by unsold assets. Suncity placed unrented senior housing and assisted living units, along with unsold commercial spaces and hospital facilities, into a real estate trust and provided senior beneficiary rights to lenders.
Suncity is facing mounting financial pressure due to sluggish sales. As of the end of last year, the company posted a net loss of 30.5 billion won, with current liabilities exceeding current assets by 280.9 billion won. Its total equity has turned negative at minus 62.3 billion won, indicating full capital impairment. Sales of its commercial units, a key revenue source, stood at just 25.73%.
Meanwhile, the construction division of Hanwha Corporation is also facing growing risks, including delayed payment recovery and potential debt assumption. As of the first quarter of this year, the project’s construction progress reached 100%, yet the contractor has not received 138.8 billion won from Suncity—more than one-third of the total contract value of 370 billion won.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
