R&F Properties and its subsidiary R&F Properties (HK) were upgraded to CC from RD by Fitch on the completion of its exchange offer. R&F succeeded in delaying payment on its $735mn 5.75% dollar bond due last Thursday by six months after buying back 16% ($116.4mn) of the note under a tender offer. Fitch notes that R&F continues to face liquidity challenges as a large amount of short-term debt matures in 2022, with limited funding access. R&F’s cash balance stood at RMB 13bn ($2.05bn) at end-June 2021, while its bond maturities in 2022, after the exchange and including puttable bonds, stand at ~RMB 17.6bn ($2.8bn). Progress on its asset disposals have also been slow. The upgrade comes just over a week after Fitch downgraded the company to RD from C, stating that the exchange offer was tantamount to a distressed debt exchange (DDE).

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