CHINESE mainland property developers kicked off the new year with a strong pipeline of bond issuance, in particular for long-tenor notes, taking advantage of easier regulatory approvals and robust market demand.

Analysts said there were signs of a slight loosening in granting quotas to developers with offshore refinancing needs, but cautioned that credit risks remained with property sales expected to be flat this year.

Developers, including Longfor Group, Yuzhou Properties and KWG Group, sold notes between six to 12 years Monday, according to filings.

At least seven more developers, including top players Country Garden and Sunac China, are planning to sell bonds, filings and rating agencies’ notes said.

A senior executive of one of the issuers, who declined to be named, said it was a good time for those who have bond quotas to tap the market, given the current attractive market pricing.

“If there’s quota then finish it first, you don’t know the next time you can get a quota again,” said the executive, referring to the changing regulatory environment.

“There’s no risk to issue a long-tenor bond, but if you’re unable to get a quota to raise money, and there’s any changes to the environment then you’re in trouble.”

The high-yield emerging markets, which Chinese property names dominate, achieved returns of 13-15 percent in 2019, one of the strongest on record, according to credit researcher Lucror Analytics, driven by a change in the U.S. Fed’s stance on rates that had spurred large credit fund inflows.

Yuzhou Properties was one of the active issuers last year. The coupon of its notes due 2026 sold Monday is 7.375 percent, compared with 8.3 percent for 2025 notes issued in November. The firm sold US$645 million this time. (SD-Agencies)