Jul 06, 2021 04:15 AM

HNA Sued Over Missed Payments on $23 Million Apartment Mortgage

(Bloomberg) — HNA Group Co., China’s debt-laden conglomerate, was sued in a Hong Kong court over failing to make payments on a HK$180 million ($23 million) mortgage for a luxury apartment.

The group, which is undergoing a debt restructuring and faces $187 billion in creditor claims, is one of four defendants being sued by lender, Thing On Capital Ltd.

Thing On loaned the money to Billion Able Corp. in June 2019 for a duplex apartment at 39 Conduit Road, a high-end Hong Kong residential development. HNA was Billion Able’s ultimate parent when the mortgage was signed and was one of the guarantors for the loan.

Thing On is now asking the defendants repay all the monies, which were due June 21, as well as related interest. It also wants the property to be put up for sale.

Apartments at 39 Conduit Road, located in a prestigious neighborhood called Mid-Levels and built by Henderson Land Development Co., are known for fetching high prices. In 2017, a penthouse was sold for HK$522 million.

A unit in the development bought by HNA in 2015 for HK$430 million was seized last year by PricewaterhouseCoopers LLP, local media including Ming Pao Daily reported. It’s not immediately clear whether the apartment is one and the same.

HNA, which once borrowed heavily to buy global assets including stakes in Deutsche Bank AG and Hilton Worldwide Holdings Inc., is in the process of shrinking after China tightened credit rules to crack down on capital flight.

In February 2020, the government of Hainan province, where HNA is based, took control of the group’s management, and HNA announced a debt reorganization earlier this year.

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