OceanWide Plaza Downtown Los Angeles News July 2020

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REAL ESTATE NEWS: Ocean of Debt

The L.A. Loft Blog has received many requests for more information about the massive incomplete construction project that lies directly between Staples Center and Flower Street Lofts in Downtown Los Angeles. Here’s an update with details just in about the stalled megaproject: | Blog Video

We would like to point your attention to the information we found in China as it relates to the stepdown of Chairman, Lu Zhiqiang.  The only information we could find in the US news is reported on Bloomberg that there is a new Chairman in place, as well as two new Vice Chairmans.  Why did Mr. Lu Zhiqiang step down quietly without any news being released about the new leadership team put in place?  Furthermore, news sources in China believe that Chairman Lu is hiding in San Francisco currently and possibly has been in the United States for a while.  

City of Los Angeles: Ocean of Corruption

Knowing that the Chairman, Lu Zhiqiang, has stepped down and a new Chairman, Song Hongmou, has been put in place, and auditor PWC has resigned, one can draw their own conclusions as to possibilities of issues within Oceanwide Holdings and the potential for findings in connection with the ongoing FBI investigation with Los Angeles City Councilman, Jose Huizar.  Please note, we have not done the research of possible connections to corruption in their other locations in the US but perhaps this is worth digging into?

Finally, to note, many of the articles we found surrounding Oceanwide Los Angeles, the Mechanics Liens mentioned are approximately $100 million.  It is our understanding through public records and filings, the mechanic liens have climbed to $180 million.  The EB-5 loans will be coming due in 2021 (no further extensions) and it is highly unlikely a project of this nature, with no ability to fund will be completed in time to pay such notes. 

February 27, 2019

PWC RESIGNS AS AUDITOR FOR CHINA OCEANWIDE FOLLOWING PROFIT WARNING

May 1, 2020

Oceanside Q1 2020 reported net loss of RMB RMB$1.2 billion

http://xinpi.stcn.com/finalpage/2020-04/30/pdf1207681887.shtml

May 21, 2020

Oceanwide Holding Chairman Lu Zhiqiang stepped down as Chairman

https://finance.sina.com.cn/stock/estate/yw/2020-05-21/doc-iirczymk2747881.shtml

http://www.szse.cn/disclosure/listed/bulletinDetail/index.html?1a6a72a6-e7c1-4927-b008-d7e083d45a1c (Chinese equivalent SEC filing with Shenzhen Stock Exchange)

 May 29, 2020

Oceanwide Holding CEO Lu Zhiqiang changed to Song Hongmou

http://finance.eastmoney.com/a/202006021506368730.html

https://finance.sina.com.cn/roll/2020-06-02/doc-iircuyvi6293071.shtml

http://www.sse.com.cn/disclosure/bond/announcement/company/c/2020-05-29/3881696824291943151402170.pdf  (Chinese equivalent SEC filing with Shanghai Stock Exchange)

June 23, 2020

“LA Councilman Jose Huizar Arrested By FBI, Accused Of Leading ‘Criminal Enterprise’ From City Hall.  Huizar was named in another search warrant the FBI issued to Google in July 2018, which suggested the feds were digging into “development projects in and around Los Angeles that relate to foreign investors.” Chinese development firms like Oceanwide Holdings were included in the warrant, which requested information from the Gmail account of Raymond Chan, former head of the city’s Department of Building and Safety. Chan later worked as a deputy mayor and then at the private firm CCC Investment Group”

https://laist.com/2020/06/23/la_councilman_jose_huizar_arrested_by_fbi_amid_city_hall_corruption_probe.php

Oceanwide Holdings Plunged into Financial Crisis

As of the end of the first quarter 2020, Oceanwide Holdings is rushing into deep crisis. The company as the guarantor of the group’s multiple projects in the US covering San Francisco, Los Angeles and New York, etc., its critical financial condition will seriously delay the subsequent progress of these projects. 

Debt: a tremendous amount of debt will be due before the end of 2020 

In 2020, the company’s rigid payment debt will mainly consist of credit bonds due in 2020, non-standard financing and interest payable of the interest-bearing debt.

As of the issue date of this report, the principal amount of the credit bonds due / sold-back within 2020 is about US $1.04 billion, the overseas senior bonds is bout US $420 million, the scale of non-standard product debt is about US $910 million, and the comprehensive financing cost of all interest bearing debt is about 8.64%.

According to the calculation, the interest expenditure in 2020 is about US $970 million. Therefore, it is estimated that the amount of newly paid debts of the company will be about US $3.34 billion in 2020.

Profitability: revenue is sharply falling and first quarter result turns out to be loss

From January to March 2020, the company’s total operating revenue is about US $333 million with 18.71% decrease comparing with that of same period last year. The total profit was USD -29 million, which turned into a loss. The profitability declined significantly, mainly due to the impact of the epidemic on the real estate development and financial business of the company.

Credit Rating: rating has been substantially downgraded by top credit rating firms

In March this year, the rating of Oceanwide Holdings was twice downgraded by international rating agencies. On March 3, S & P downgraded the long-term issuer credit rating of Oceanwide Holdings to “CCC” and the long-term issuance rating of senior unsecured notes to “CCC -“. On March 19, Fitch lowered the Long-Term Foreign-Currency Issuer Default Rating and senior unsecured rating of Oceanwide Holdings from “B -” to “CCC +”. At the same time, both institutions believe that the short-term maturity debt of Oceanwide Holdings is quite large and the risk is increasing.

Financing: company faces great difficulties in large fund raising 

Looking back on the bond financing of Oceanwide Holdings in the past six months, it has not made smooth progress. Since the end of last year, the company has repeatedly issued bonds and failed to obtain full market subscription.

As of December 25, 2019, the planned public issuance of corporate bonds did not exceed US $315 million and the final actual issuance amount was around US $71 million; as of January 23 of this year, the planned public issuance of bonds was no more than US $243 million and the final actual issuance amount was around US $171 million; as of February 26 of this year, Oceanwide Holdings planned to issue no more than US $71 million of corporate bonds and the final actual issue amount was about US $57 million. In addition to its overseas rating downgrade, it is expected that the overseas issuance of bonds by Oceanwide Holdings will be very difficult.

Guarantee: external guarantee balance is reaching 300% of the net assets

According to the announcement of Oceanwide Holdings on June 19, the total guarantee amount of the company and its holding subsidiaries in 2020 was expected to be about US $8.9 billion. The actual external guarantee balance of the company and its holding subsidiaries is about US $8.63 billion, which is 281.38% of the parent company’s audited net assets as of December 31, 2019.

Appendix

Company Main Financial Data and Indicators

ItemYear 2017Year 2018Year 2019March 2020
Main financial data and Indicators
Total asset ($m)26,82530,30025,41025,580
Shareholders’ equity ($m)3,9284,0614,7304,818
Equity attributable to shareholders of the parent company ($m)2,8672,8743,0683,065
Total liability ($m)22,89726,23820,68120,763
Short-term debt ($m)6,8077,2656,6606,724
Long-term debt ($m)9,93010,1135,8756,040
Total debt ($m)16,73717,37812,53512,763
Operating income ($m)1,19871543223
Total profit ($m)578192344-29
Net profit ($m)442148204-19
EBITDA ($m)903545798
Net cash flow from operating activities ($m)-2,7511,315796-242
Net cash flow from investing activities ($m)-356-4001,04644
Net cash flow from financing activities ($m)1,113-1,393-1,808153
Asset/liability ratio (%)85.3686.6081.3981.17
Long-term debt/capitalization ratio (%)71.6671.3555.4055.63
Total debt/capitalization ratio (%)80.9981.0672.6172.60
Non-financing net cash flow/debt ratio (%)-18.575.2714.69

Main Indicators of Company’s Solvency (%, multiple)

IndicatorYear 2017Year 2018Year 2019March 2020
Current ratio151.19135.19134.35135.92
Quick ratio57.0152.1174.9574.39
Cash/short-term debt0.400.430.390.38
Operating cash/current liability-21.468.265.46
EBITDA/interest multiple0.860.460.73
Total debt/EBITDA18.5431.9015.70

*  Exchange Rate for US Dollar/ RMB: 1/7

The company’s solvency condition is deteriorating due to the delay in sales of its US assets caused by the Covid-19 pandemic and the sluggish economy. 

Controlling Shareholding Structure

*March 31, 2020

According to the Shareholder Chart, Zhiqiang Lu indirectly occupies 55% shares of Oceanwide Holdings Co., Ltd, but, he curiously resigns both positions of Chairman and Enterprise-juristic Person on May 25, 2020.


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New Lofts Downtown Los Angeles New Homes Under Construction and Coming Up For Sale

New Homes in Downtown L.A. Under Construction

Shiny new and sparkling clean new homes with the latest architecture and most modern convenience combine with new loft conversions, newly remodeled historic and industrial buildings converted to modern urban live/work residences, coming to DTLA.  #newlofts #dtla #newhomes

Historic building soon to become residential live/work lofts
Historic building soon to become residential live/work lofts

NEW LOFTS

Prospective Downtowners and investors appreciate it when old historic and industrial buildings are converted from useless dilapidated structures into repurposed residential live-work lofts with open spaces, lots of oversized windows and natural light, in the best walking areas near shopping, dining, entertainment and transportation. From 2000 to 2014, more than 20 buildings were converted. But in the last 3 years, there have been only rentals, and not available for purchase. The good news is that this trend may be changing.

Newest Buildings Lofts popular, well-known condominium loft building in the Arts District and other neighborhoods in and around Downtown Los Angeles. It’s been several years since any loft buildings have been created in Downtown Los Angeles.  The most recent one was Barker Block Warehouse 1.
Downtown Los Angeles.

New Lofts Downtown LA
Where are the new Lofts in Downtown Los Angeles? When Barker Block Warehouse 1 opened in 2014, there was a mad rush on the very first day of sale, with 2,800 lookers for only 15 available units. The seller had a big advantage. The developer’s sophisticated marketing machine captured offers well above asking price, above the comps and above market value for Downtown L.A.

VIP Access to New Constructon Lofts Downtown L.A.
While the neighborhood suffered from a glut of unsold properties six years ago, Downtown L.A. today is today experiencing a dramatic shortage of affordable homes for sale. Buyers of lofts and condos are finding that cheapest entry level lofts have tripled in price from around $150,000 in 2011 to around $450,000 today. New residents and investors who put faith into Downtown real estate have been proven right in a big way. Downtown homeowners are sitting pretty, but it takes some new thinking for buyers to make the best of the current market. We can clearly see the very good side to owning real estate in the world’s most amazing Downtown renaissance, a bright financial future.

Successful buyers today must take advantage of the most powerful strategies to find bargains around Downtown. Today’s successful buyers get access to REO bank-owned foreclosures, short sales, distress sales, fixer uppers, raw lofts and nearby condos and houses outside of Downtown. For those who want to live in the heart of Downtown, new construction and unlisted properties have most recently provided the best solution. Pocket listings have accounted for nearly half of the best deals in the past 5 years. Not every agent can help with pocket listings because they are exclusive in nature. Those unfortunate buyers who are using an out-of-area agent have had the worst luck.

New L.A. Loft Construction
There is hope for buyers who need to see more properties for sale! Many successful buyers have found more than 200 unlisted properties for sale in the past few years, including more than 100 new construction lofts. While the general public has seen rising prices along with fewer and fewer good properties available, thousands of smart buyers have discovered hard-to-find information and were able to see a variety of pocket listings in Downtown Los Angeles.

Home buyers have had found the most amazing lofts and the best prices when they were able to see as many amazing lofts and condos as possible. They focused on total properties to see. There are always a number of unlisted loft bargains in Downtown. Simply sign up for the New Loft Interest List.

New Lofts Coming to Downtown – Find Out When and Where, and get email notification when new lofts are announced.

Barker Warehouse

Title Guarantee

Chapman

Brockman

MORE

Downtown Los Angeles New Lofts Coming Up For Sale – Which Loft Buildings Will Go Condo?
Downtown Los Angeles New Lofts Coming Up For Sale:
Which Loft Buildings Will Go Condo?

Downtown is SOLD OUT!!!!!!!! If you did not purchase a new loft in the past three years, then you are out of luck. Or are you?

In 2007, Downtown had at one point around 300 brand new loft conversions coming onto the market. Today, the number is close to zero new constructions lofts for sale. Resale loft inventory is also near an all time low. There are almost no foreclosures or short sales. When new Barker Block Warehouse 1 lofts went up for sale in January, buyers faced widespread sticker shock as the prices were nearly all above $500,000. Buyers are looking for a deal. For 2014/2015, the two best places to find the best loft deal are new lofts and unlisted lofts.

The L.A. Loft Blog has the scoop on the loft rental buildings that are most likely to come onto the market for sale in the near future, including:
Downtown SOLD – Request VIP access to new upcoming lofts for sale
Luxury Loft Tower
Historic Furniture Warehouse
Luxury Historic Lofts
Historic Core Flats
Luxury Restaurant Row Historic Lofts
Historic Core Loft Tower with Balconies
Shopping and Restaurant Arcade Lofts
Pershing Square Historic Loft Building
Other loft buildings going condo and new construction lofts: Get a free hotlist of new lofts coming up for sale, with loft rental buildings that are rumored to be going condo in the future.

Be among the first to be notified of new lofts coming up for sale. As a VIP Buyer, you will also receive lists of Downtown distress sales, unlisted lofts, short sales, raw lofts and sold lofts for comparison. Get invited to see new lofts under construction, loft condo conversions and loft buildings going condo by registering for the VIP Buyer Program free at http://www.lacondoinfo.com/vip_buyer.asp

Which loft condo rental buildings is most likely to go condo next?

Promenade West

Title Guarantee

The Brockman

Spring Arcade

None of the above

New Lofts Coming to Downtown – Which Loft Rental Building is Most Likely to Go Condo Next?

Which Loft Rental Building is Most Likely to Go Condo Next? Take the GOING CONDO Quiz.
Which loft rental building is most likely to GO CONDO next? Take the Quiz.
More than half of Downtown loft buyers prefer to purchase a new development of a genuine historic loft. These newly renovated lofts are often considered to be the most modern, chic and impressive homes of today. Out are the small, dark compartmented rooms with wall-t0-wall carpet – yuk!! In are huge windows, bright natural light with views, open floorpans with just the right bed area separation, polished floors and stainless steel appliances. The L.A. Loft Blog has recently heard from several sources about one impressive loft building in particular that may be going on sale very soon. Be among the first to find out. Take the Loft Blog “Going Condo” Quiz to test your Downtown loft knowledge. You will immediately get the correct answer, and you will be notified by email of upcoming loft condos for sale.

Test your Downtown loft knowledge. Which Downtown loft rental building is most likely to go condo next? Take the Quiz and find out now! Fill out my online form:

We have recently received word of some new Downtown historic lofts coming up for sale in September, several new luxury high-rise condos for sale, new 3-story townhomes in Silver Lake (some with private rooftop terraces and views), new high-rise luxury Downtown apartments for lease and even new short-term luxury high-rise apartments as well.

Save $25,000 GUARANTEED or I’ll Pay You $3,000 – Details at http://www.coreychambers.com/save-4-25k

Now that most experts agree that interest rates will be rising sooner rather than later, buyers can lock in low rates in a super strong, relatively stable market in the most exciting place on Earth. We are recently hearing more and more people compare Downtown L.A. to New York City. Of course, Downtown does not compare to NYC in population density, and New York does not compare to Downtown LA in spaciousness, climate or entertainment and recreation options. Best of all, compared to New York City, prices in Downtown Los Angeles are still quite a bargain for now.

New Apartments Downtown Los Angeles
Get more info on new historic lofts coming up for sale, new luxury high-rise condos now for sale, new apartments for lease, new short-term high-rise apartments or Silver Lake Townhomes.

New Lofts Coming Up For Sale in Downtown Los Angeles – Modern, Updated Condos in Historic Building
This is it! It’s what you’ve been looking for: Newly renovated Downtown historic live-work lofts with spacious open floor plan, high ceilings, lots of windows and light, and easy walk to dining, shopping and entertainment. Find out more. Get on the New Lofts Interest List.

Those who are interested can get details, photos and and early viewing with the L.A. Loft Blog information request form below.

New Lofts DTLA

The public will soon have an opportunity to own an icon of an Art Deco style high-rise building in Downtown Los Angeles. The selection of several new lofts for sale were built in 1930s. Originally luxury office building designed in the roaring 20’s, the historic buildings have been converted into loft homes. Just minutes from upscale restaurants, steps away from dining, well-known art galleries, cultural attractions, L.A. Live, Staples Center, Metro transportation and shopping and entertainment venues.
Courtesy Killefer Flammang Architects
Prices soon to be available to the public. There are several different floor plans, some with
terraces and balconies. Studios from 750 sq. ft. – 855 sq. ft. One bedrooms at 1,020 square stumptown-coffee-artsfeet – 1,100 sq. ft. Two bedrooms at 1,390 sq. ft. – 1,410 sq. ft. Duplex with 2 and 3 bedrooms at 1,280 sq. ft. – 1,945 sq. ft. Penthouses 1,620 sq. ft. – 3,565 sq. ft.

We anticipate a quick sell out of these unique one-of-a-kind loft homes in downtown LA.

Get more information with descriptions and photos, and request an early viewing. Fill out the online form below.

New Lofts Development For Sale Coming Soon To Downtown Los Angeles
More than half of all of those who are thinking about owning a loft in Downtown will choose a new loft development in an historic or industrial loft building when given the opportunity. Recently, that chance has only come around about once every couple of years or so.

New lofts are popular because they combine the authentic urban character with convenient amenities, modern appliances and stylish finishes. They are often the best deal because the developer creates a glut of dozens of units for sale at a time that must be sold.

Other benefits of new lofts are an initial lack of lawsuits and litigation that plague nearly 20% of Downtown loft listings. While existing loft buyers often have issues getting a home loan, there is usually no problem getting financing at a new loft development as the developer has already connected with a lender who will provide loans on the special loft conversion condos in the formerly commercial building. There are pitfalls to avoid.

Buyers often make many mistakes when dealing with developers. In an extremely competitive environment, some buyers make the mistake of blindly trusting the seller, and then fail to get free representation from a Downtown specialist Realtor who can help the buyer to get as many advantages as possible over the seller and competing buyers. The most common and biggest mistake is innocently walking into a new loft sales office without an agent. The innocent visitor, who is just browsing, does not know that he or she will love the lofts until after seeing them. By that time, IT’S TOO LATE. The developer has already set up the potential buyer to waive several of their legal rights, starting with the right to free representation by a Downtown specialist Realtor. That is why everyone, especially first-time buyers, absolutely MUST bring a Downtown specialist real estate agent to the very first viewing to protect the buyer’s rights. Some unlucky buyers are never informed about all of the pros and cons of the building, and worst of all, some buyers never find out what is really the lowest price that the developer will accept. Many buyers pay $10,000 or more than necessary because they did not take advantage of a Guaranteed Savings Program such as Save10Grand.com.

Anyone interested in new Downtown lofts can request property descriptions, photos and an early viewing. Beat out other buyers to the best new lofts and best deals. Fill out the online form:

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New Lofts Downtown Los Angeles
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Copyright ©  This free information provided courtesy L.A. Loft Blog and LAcondoInfo.com with information provided by Corey Chambers, Realty Source Inc, BRE#01889449 We are not associated with the homeowner’s association or developer. For more information, contact (213) 880-9910 or visit LAcondoInfo.com  Licensed in California. All information provided is deemed reliable but is not guaranteed and should be independently verified. Properties subject to prior sale or rental. This is not a solicitation if buyer or seller is already under contract with another broker.