(Yicai Global) Sept. 3 -- Shares in the property developer arm of China Minsheng Investment Group surged today after a banking consortium agreed to stump up funds to restart the revamping of Daxing Street, a densely-packed old community in downtown Shanghai, after the project was suspended for two years due to the Chinese private investment group’s cash crisis.

SRE Group’s share price [HKG:1207] closed up 9.76 percent today at HKD0.045 (USD0.01), giving it a market capitalization of HKD864 million (USD111.2 million).

The consortium, which includes the Industrial and Commerce Bank of China’s Shanghai branch, has loaned the project CNY1 billion (USD154.8 million), The Paper reported. It is the first big loan to Shanghai-based Minsheng Investment since a spree of overspending led it unable to repay its debts from 2019.

The highly sought-after 37,129 square-meter plot of land in the city’s Huangpu district will be turned into luxury apartments, retail outlets and office buildings. SRE is in the process of negotiating compensation for residents who must make way for the new development, either in the form of a lump sum or a new property.

SRE, which was acquired by Minsheng Investment in 2015, logged losses of CNY116 million (USD18 million) in the first half on CNY149 million in revenue, according to the Hong Kong-based developer’s latest earnings report.

Minsheng Investment owed CNY233 billion (USD36 billion) as of the end of Sept. 2018 and only had assets of CNY300 billion, giving it a debt ratio of 75 percent. Last year it appointed a new board of directors and started business restructuring under government supervision.

Editor: Kim Taylor