13 sets of villas fail to sell at 374 million yuan, Kaisa's asset disposal in Guangzhou hits a dead end

Assets going to judicial auction is the last choice a property owner wants to face, yet it becomes the unavoidable fate when no other options remain.

Recently, 13 villas owned by Kaisa in Baiyun District, Guangzhou, were listed for judicial auction on the Ali Assets platform. With a total floor area of 4,861 square meters and a total starting bid price of approximately 374 million yuan, the listing only drew a crowd of onlookers: over a thousand views, but zero bids, resulting in a collective failed auction for all the assets.

Of course, there may be buyers among the onlookers hoping to get a bargain. Their refusal to place bids is either because the price is not attractive enough, or they cannot accept the inherent flaws of the assets.

Why did these 13 villas fail to sell at auction? What kind of past of Kaisa lies behind this situation?

Past of the Project

There are no assets that cannot be transferred, only assets that are not sufficiently high-quality.

The 13 unsold villas in this auction belong to the Yunshushu cluster of the Kaisa Tianyu project. In May 2013, after nearly 200 rounds of bidding, Kaisa finally secured the plots at No. 8 and No. 10 Tongbao Road, Guangzhou at the price limit for 1.868 billion yuan. After deducting the supporting construction area, the floor price reached 25,600 yuan per square meter, successfully setting a new record for the residential unit price in Baiyun District that year.

In 2014, the project's planning scheme was officially approved, with a total permitted floor area of approximately 144,400 square meters and a plot ratio of 2.2. Three types of properties were planned in total, including 138 small-sized duplex units of 97-98 square meters, 157 sky-top duplex units of 240-260 square meters, and 38 townhouses/detached villas.

Although the project was approved as early as 2014, it took four years to officially launch to the market. The Yunshushu cluster obtained its pre-sale permit even later, in 2019, and completed the centralized official online signing and overall delivery in 2021.

According to Ali Assets, among the 13 Yunshushu properties listed, one is a fully furnished unit for separate auction, with an area of 445 square meters and a starting bid price of 38.94 million yuan; the remaining 12 are unfurnished units that must be sold as a package with multiple parking spaces, with the total starting bid price per unit ranging from 22.03 million yuan to 32.52 million yuan.

When converted together with the area of the parking spaces, the starting unit price of the unfurnished properties ranges from 68,000 yuan to 86,000 yuan per square meter, and the starting unit price of the furnished property is 87,600 yuan per square meter. In the current Nanhu area where the project is located, these prices are not low.

Data from Anjuke Guangzhou shows that the latest average transaction price in the Nanhu area is 42,200 yuan per square meter, a 5.24% month-on-month increase. However, the prices of competing properties in different tiers within the area vary significantly: for example, the average price of quality upgraded properties such as Xintian Banshanshu and Nanhu Banshan Haoting is above 70,000 yuan per square meter, while the listed unit prices of mainstream demand-oriented upgraded villas such as Yipin Hushan and Yihe Villa are concentrated in the range of 40,000 to 58,000 yuan per square meter.

The Kaisa Tianyu project belongs to the tier of relatively new, upgraded pure villa properties. It entered the market in 2018, and the market categorized it in the same tier as Xintian Banshanshu and Nanhu Banshan Haoting. In 2023, the average transaction price of this project was around 90,000 yuan per square meter. If the assets were flawless, a listed price above 70,000 yuan per square meter would still be reasonable.

However, with the combination of judicial auction and asset flaws, the pricing of the project has to be considered differently.

Among them, the normal use of the garage is one of the biggest problems. The survey form specifically reminds: since the underground garage corresponding to the 12 villas has been enclosed and cannot be used independently and normally as standard parking spaces, the properties and their corresponding underground parking spaces will be auctioned as a whole. Bidders shall consult the relevant departments on their own for access routes.

At present, there is a sufficient supply of new properties in Baiyun District, Guangzhou with a unit price of 68,000 to 86,000 yuan per square meter. For example, for Poly Yunrui next to Baiyun Mountain in Baiyun New Town, the average price of mid-to-high floor units with a construction area of 147 square meters is only 68,000 to 75,000 yuan per square meter. Why would property buyers spend tens of millions of yuan to unnecessarily increase their property purchase burden?

Deadlock

The collective failed auction of the 13 villas is more of a microcosm of Kaisa Group's overall operating difficulties and the pressure on asset disposal.

The reason why this batch of villas has problems such as bundled disposal in batches, high pricing, and inflexible disposal methods fundamentally stems from Kaisa's layered mortgage financing operation in 2019, which is also the hidden core cause of this large-scale failed auction.

In 2019, the overall assets of the project were successively mortgaged to Minsheng Bank Guangzhou Branch and Shenzhen Branch. The Guangzhou Branch registered a creditor's right of 2 billion yuan, and the Shenzhen Branch registered a creditor's right of 348 million yuan, with a total creditor's right scale of 2.348 billion yuan. The former is the exclusive construction fund for the Tianyu project, and the latter is the group's overall working capital loan.

However, soon after, Kaisa fell into a liquidity crisis at the end of 2021. Without sufficient cash for repayment, Minsheng Bank had no choice but to initiate legal proceedings. The Guangzhou Intermediate People's Court filed the case for enforcement, with the enforcement target of approximately 624 million yuan, leading to the current situation where the listed assets failed to be sold at auction.

At present, Kaisa's high-quality assets in many regions across China have fallen into a deadlock of "difficulty in closing deals after listing, no takers even after price cuts". In addition to the failed auction of the villas in Baiyun, Guangzhou this time, the large complex asset of Kaisa Center in Haizhu District, Guangzhou, went through two rounds of price reduction auctions in 2026, dropping from 2.72 billion yuan to 2.18 billion yuan, but still failed to sell entirely, and has now entered the sale process.

The Kaisa Golden Bay Hotel in Longgang District, Shenzhen is in the same situation. It was first listed in December 2024 with a starting bid price of 1.671 billion yuan; it was listed twice more in 2025, with the price reduced to 553 million yuan; in May 2026, the project was auctioned again, and still faced the situation of zero bids.

Under the continuous downward trend of failed asset auctions, the successful realization of the 10-billion-yuan asset debt offset of Kaisa Jiayuan in Futian, Shenzhen in April 2026 may be one of the few good news for Kaisa.

Although Kaisa's offshore debt restructuring plan took full effect in 2025, successfully writing off approximately 8.6 billion yuan in offshore debt and turning its net asset value from negative to positive, the restoration of its profit-generating capacity is critical for the group to survive.

In terms of operating performance, Kaisa Group's contracted sales together with its joint ventures and associated companies in 2025 were only 5.544 billion yuan, a year-on-year decline of 17.9%, and the sales area dropped sharply by 36.6% year-on-year. After excluding the gains from debt restructuring, the company's main business is still in a loss-making state.

Returning to the realization of mortgaged assets, in the final analysis, location and supporting facilities, as well as asset liquidity, are the core advantages of a project. This is why Kaisa was able to use the Futian Jiayuan project to offset the investors' creditor's rights.

The collective failed auction of these 13 villas also indicates that the bank will most likely launch a second auction with a price cut and a sale process. This batch of core villas in Baiyun still has room for market game.

This article is from the WeChat Official Account "Viewpoint", authored by Viewpoint New Media, and published with authorization by 36Kr.