(Yicai) July 19 -- Struggling Chinese real estate company Sansheng Hongye Investment Group has sold its headquarters building in Shanghai at an 18 percent discount from its estimated value.

Shanghai Wanjie Business Management placed the CNY830 million (USD110 million) winning bid for Sansheng Hongye's HQ building, located on the Bund in Shanghai, at an auction on Alibaba Auction on July 17. The starting price was CNY730 million.

A first auction for Sansheng Hongye's HQ, with a starting price of CNY800 million, was held last month, but no bidders participated. The estimated value of the building was just over CNY1 billion (USD138 million).

Wanjie Business Management was established one month ago with a registered capital of only CNY100,000 (USD13,780), according to public corporate information.

Sansheng Hongye's HQ is in a prime location with a river view, making it a highly attractive property at that price, said Cai Feng, executive director for East China capital markets at Cushman & Wakefield. The market does not lack buyers, and more transactions like this one are expected to occur in the future, he added.

Sansheng Hongye was once among Shanghai's top 100 property developers. Its performance began to decline in 2019 for various reasons, including business diversification and the downturn of the real estate market.

In 2021, the China Securities Regulatory Commission punished Sansheng Hongye's founder Chen Jianming for stock manipulation, which resulted in the confiscation of illegal gains and a 10-year ban from the securities market. Many of the company's assets were later put up for auction.

Sansheng Hongye's debt totaled nearly CNY32.9 billion (USD4.5 billion) as of April 9, according to a statement released by the Shanghai Bankruptcy Court in May. The company's total assets were about CNY22.9 billion in December last year.

If Sansheng Hongye's restructuring advances smoothly, there is a possibility that the firm could regain or enhance its debt repayment capabilities, the Shanghai Bankruptcy Court noted. However, there are still uncertainties.

Editor: Futura Costaglione