[HONG KONG] Hong Kong developer Tai Hung Fai Enterprise, founded by billionaire Edwin Leong, has secured a private loan of up to HK$900 million (S$148 million), sources familiar with the matter said, as more property firms turn to such financing.

Dignari Capital Partners, an Asian private debt firm, provided the two-year loan, which will go to covering construction costs for a 30-storey office tower in the western part of Hong Kong Island, the sources said.

The location at 92-103A Connaught Road West is near a memorial park for the revolutionary Chinese leader Sun Yat-sen, and close to the waterfront with views over the famed Victoria Harbour.

Total capital provided for the loan up to the maximum drawdown will depend on construction costs and the needs of the project manager, the sources said.

A spokesperson for Tai Hung Fai declined to comment, while Dignari did not respond to requests for comment.

Hong Kong developers are increasingly seeking private credit, after China’s years-long property debt crisis spilt over into the city, leaving banks wary of piling on more real estate debt as they struggle to handle a growing pile of non-performing loans.

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In May, Gaw Capital Partners provided a HK$300 million private loan to Hong Kong real estate developer First Group Holdings, while investment firm PAG provided Hong Kong Parkview Group with a HK$300 million private bridge loan, Bloomberg News reported in May.

Tai Hung Fai was founded in 1977 by Leong initially as an investment company.

It has since evolved into a property development firm with a portfolio of over 450 retail shops, commercial buildings and several hotels, including the Hotel Indigo and Hotel 1936, according to the company’s website.

Leong has a net worth of US$3.3 billion as at Jul 31, according to the Bloomberg Billionaires Index. BLOOMBERG