(Yicai) March 18 -- Gemdale, a major Chinese real estate developer that has about CNY15 billion (USD2.1 billion) of debt coming due this year, has named a new chairman and its first vice chairman.

Xu Jiajun, who was senior vice president, secretary, and chief executive of Gemdale's commercial property arm Gemdale Properties and Investment, will now chair Gemdale, the Shenzhen-based builder announced yesterday.

His predecessor, Lin Ke, resigned the chairmanship and other positions last October after a 25-year stint. President Huang Juncan was acting chairman in the interim. In yesterday's statement, Gemdale said Huang’s name would not go into the directorship nominations for Gemdale's new board for personal reasons. 

Xu, 46, has extensive management experience in real estate, Gemdale noted, adding that he is also familiar with the capital market and is widely recognized in the financial field.

The choice of Xu shows shareholders recognize the ability of managers in the Gemdale group, a company source told Yicai and other media.

Ji Tong, who chaired shareholder Futian Investment Holding, becomes Gemdale’s vice chairman, a newly created position. Ji has been an executive director at Gemdale since May 2022. His appointment reflects local government support and confidence in the builder’s future, the insider added.

A wholly owned investment arm of Shenzhen’s Futian district government, Futian Investment Holding is Gemdale’s second-largest shareholder, with a 7.8 percent stake. Late last year, a unit of Futian Investment acquired a 51 percent holding in a real estate project from Gemdale for CNY3.3 billion (USD458.5 million), as the developer was raising money to pay maturing debt.

Gemdale has relatively numerous shareholders, so operations are mostly under the control of the management team. Raising funds to pay off debt will be the new board’s main challenge this year.

Gemdale secured CNY6.5 billion in bank loans early this month and repaid two recently matured debts worth a combined CNY3.5 billion. But the company still has about CNY15 billion of debt set to expire this year, including a USD460 million offshore bond.

Unlike many other Chinese developers, the firm remained in the black last year, despite a big drop in earnings. Net profit shrank 85 percent to CNY888 million (USD123.4 million) on an 18 percent decline in operating revenue to CNY98.1 billion (USD13.6 billion), according to its annual report released on March 14.

Still, Gemdale had total assets of CNY373.8 billion (USD51.9 billion) and total liabilities of CNY256.9 billion as of Dec. 31, representing an asset-to-liability ratio of 68.7 percent, a relatively healthy level compared with many domestic peers, the report showed. 

Editors: Tang Shihua, Futura Costaglione