SingHaiyi buys distressed real estate condo project in San Jose, California for $41.1 million

Catalist-listed developer SingHaiyi Group bought its second distressed real estate in the United States for US$33.05 million ($41.1 million).

The company said on Monday that it had acquired Vietnam Town, a partially completed condominium project in San Jose, California, which had been placed under receivership.

From the US$33.05 million funded through a recent rights issue and share placement exercise, US$29.8 million was used to repay an outstanding secured debt.

The remaining US$3.25 million went to payment for the freehold project which comprises land parcels spanning 853,502 sq ft.

Out of the 256 planned condo units in Vietnam Town, about 45 per cent of the units have been built, of which 64 have been sold, said SingHaiyi in a statement.

The developer lost funding for the project some time during or after the global financial crisis in 2009, and the project was subsequently placed under receivership.

SingHaiyi also said that it intends to sell the 51 unsold units in the next two years and use the sale proceeds to construct and sell the remaining 141 units within the next three to five years.

This is SingHaiyi's second major acquisition after its Sept 30 announcement to acquire the two-storey Tri-County Mall in Cincinnati, Ohio, for US$45 million. That comes at a 77 per cent discount to the unaudited net book value as at June 30.

SingHaiyi shares closed flat at 2.3 cents.