Poly Developments to Raise RMB 5 Billion via Convertible Bonds for Nine Housing Projects

At the end of August 2026, the China Securities Regulatory Commission issued the Opinions on Capital Market Support for Building a New Model of Real Estate Development, proposing support for listed real estate developers to use shares, targeted convertible bonds, cash and other instruments to acquire real estate-related assets. Where shares or targeted convertible bonds are issued to purchase assets, supporting funds may be raised and used for real estate projects that meet policy requirements and to pay consideration for the restructuring transaction, among other purposes. Poly Developments recently disclosed a prospectus for RMB 5 billion in targeted convertible bonds, becoming the first listed real estate developer on the A-share market to launch refinancing since the new real estate policy took effect.

According to the announcement, Poly Developments plans to issue targeted convertible bonds with a maximum total fundraising amount of RMB 5 billion and a bond term of six years. The coupon rate and conversion price have not yet been finalised. The company completed an RMB 8.5 billion targeted convertible bond project in May 2025, with all proceeds used for the construction of 15 real estate projects. Targeted convertible bonds are special bonds that a listed company issues non-publicly to specific targets and that can be converted into company shares within an agreed period and under agreed conditions. Before Poly Developments announced this issuance plan, real estate companies including Huafa Industrial Share had also issued targeted convertible bonds to fund real estate project construction.

Poly Developments said the projects to be funded by this fundraising have sound market development prospects and economic benefits. After the issuance is completed, the company's cash inflows from financing activities will increase, effectively easing the pressure on cash demand arising from business development.

The targeted convertible bonds issued by companies including Poly Developments and Huafa Industrial Share all focus their fundraising use on physical project development. The new housing policy uniformly raises the threshold for pre-sale of commercial housing to the completion of the main structure and simultaneously promotes a system of selling completed homes, lengthening developers' project development cycles and increasing the proportion of own funds invested in projects. Liu Shui, director of enterprise research at the China Index Academy, said the core of the new housing policy has shifted from group credit to project-based financing regulation, with the focus of financing moving from group-level entity credit to the project level. Project funds are subject to closed supervision, with receipts going into dedicated accounts, funds used for designated purposes, and no diversion permitted before delivery.

Yan Yuejin, deputy director of the Shanghai E-House Real Estate Research Institute, said that in the past financial institutions mainly assessed a developer group's overall qualifications and overall credit, but now financing assessments must be devolved and shifted to individual projects themselves. Under project-based financing, fund deployment depends on the completeness of project procedures, the status of capital contributions, and cash flow balance capacity, with greater attention to actual real estate projects and conditions in surrounding and sales markets.

In this round of new housing policy, the system of selling completed commercial housing is being promoted in a vigorous and orderly manner. All proceeds from Poly Developments' convertible bond fundraising will be used for ensuring housing delivery, echoing the new policy on sales of completed homes.

Monitoring data from multiple institutions show that the benefits of the new housing policy are continuing to transmit to the market, the home-swap chain is gradually opening up, and upgrade demand is accelerating its entry.