Embattled Hong Kong developer sued for HK$130 million, days after founder’s death

A Hong Kong property developer has been sued for HK$130 million (US$16.6 million) over allegedly breaching guarantor obligations in two bond subscription agreements, becoming the latest lawsuit to implicate the embattled company and following its founder’s sudden death earlier this week.

Lofter Group, known for its urban renewal projects across the city’s core districts, and an affiliated company were named as defendants in the High Court action initiated by Earth Core Holdings, a firm registered in the Cayman Islands, according to the writ seen by the South China Morning Post on Friday.

The court document states that Earth Core agreed to subscribe to bonds issued by local firms Our Country HK and Our Dream HK in December 2023, in the principal amounts of HK$87 million and HK$121 million, respectively.

Lofter and MSI Properties Strategy, which share the same registered address as the developer, acted as guarantors for the bonds.

After the two bonds matured at the end of November 2024, the plaintiff only received partial repayments of HK$88.9 million, according to its lawyers.

As of the date the claim was lodged on Thursday, the outstanding sums owed by the defendants under the two agreements were assessed to be HK$54 million and HK$76 million, respectively.