(Yicai Global) June 22 -- Jianye Group in China’s agricultural heartland of central Henan province is accepting partial payment for certain projects in the form of wheat or garlic to help quickly recoup funds in order to pay off mounting debts amid a sluggish real estate market.

One of Jianye’s residential housing projects in the city of Shangqiu is allowing buyers to make downpayments in wheat at a price of CNY4 (USD0.60) per kilogram up to a maximum of CNY160,000 (USD23,920). Pre-sales started in January at an average price of CNY5,800 (USD867) per square meter and the properties should be ready for delivery in June 2024, the Zhengzhou-based company told Yicai Global.

Another project in Kaifeng is accepting downpayments in garlic at a price of CNY10 per kg up to a maximum of CNY100,000. The homes are selling for around CNY5,500 a square meter and should be ready for buyers to move into this year.

The prices the developer is offering are higher than what farmers would fetch on the market. At present, the market price of wheat is around CNY3 (USD0.45) a kg and that of garlic is under CNY4 per kilo.

Jianye, which is the province’s largest real estate developer, is being creative in finding ways to pay off looming debts as sales plunge. In the first five months, sales nearly halved from the same period a year earlier to CNY11 billion (USD1.7 billion), according to real estate survey agency China Index Academy.

Yet its unit Central China Real Estate has issued USD2.4 billion of US dollar-denominated bonds, one of which worth USD500 million is due in August.

Earlier this month the subsidiary said that its biggest shareholder Enhui Investment, which is owned by Jianye Chairman Hu Baosen, will sell a 29 percent stake to Henan Railway Construction & Investment Group for HKD688 million (USD87.7 million), but Enhui will still remain the biggest stakeholder with 41 percent equity. And Henan Railway will also subscribe for HKD708 million of convertible bonds, it added.

Editors: Dou Shicong, Kim Taylor