(Yicai) May 12 -- State-owned real estate firm China Overseas Property has taken over the development and construction of two skyscrapers of bankrupt developer China Evergrande Group's international financial center in Hefei.

China Overseas acquired the development rights of a residential land plot in the center of Hefei, the capital city of China’s eastern Anhui province, for CNY364 million (USD50.4 million) on May 9.

One of the conditions of this land's purchase was the acquisition of the development and construction rights for the Evergrande Hefei Center D1 and Evergrande Hefei Center D2 skyscrapers of the Evergrande International Financial Center, a landmark building complex in Hefei's central business district, unfinished for nearly eight years.

The Evergrande International Financial Center comprises one super high-rise, 518-meter-tall skyscraper, which will be Hefei's tallest and China's sixth-tallest once completed, and four subsidiary towers. Evergrande Hefei Center D1 and D2 are in the most advanced construction stage, having already started presales in 2017, even though building has been idle since then.

According to information from the local government, the follow-up construction costs of the Evergrande Hefei Center D1 and D2 are about CNY392 million, which will be paid by China Overseas. The project is expected to be completed and begin deliveries next year.

Through this arrangement, Hefei included high-quality residential land and assets that need to be revitalized in a package to avoid direct financial support for the resumption of the unfinished project construction, market insiders told Yicai.

Moreover, the winning developer secures a high-quality land plot at a relatively low price, which allows it to use part of the related profits to finance the follow-up construction of the unfinished project.  

Since Evergrande fell into a debt crisis in 2021, its projects across China have gradually halted construction. As a result, local governments intervened to promote the resumption of construction through various means.

For example, Xi'an like Hefei required the winning developer of a high-quality land plot auction to take charge of the construction of the unfinished Xi'an Evergrande Cultural Tourism City.

Editors: Tang Shihua, Futura Costaglione