NEW YORK (Reuters) – Gramercy said on Thursday it “added a small position” in China Evergrande Group bonds as prices have fallen to where there is a “compelling risk/reward.”

According to an emerging market specialist, the investment manager for Gramercy said that the decision was taken due to Evergrande’s substantial non-core assets and the “essential nature” of the company.

The prices of Evergrande-denominated Evergrande bonds, which mature next year or 2025 in dollars, have dropped to 26 and 25 cents per dollar according to Refinitiv Data.

Evergrande, a cash-strapped developer of real estate in China, has raised concerns that its financial woes will spread to the rest of China and ripple around the globe.

Gramercy has not provided details on the Evergrande exposure and whether or not it added offshore bonds to its holdings. Although it acknowledged that China’s growth could disappoint in comparison to the market consensus, Gramercy did not anticipate a material activity shock.

Gramercy announced the new bond position in the strategy outlook for the fourth-quarter. The announcement comes just days after BlackRock, the world’s biggest asset manager said that China’s growth could disappoint relative to market consensus.

Gramercy’s fourth quarter outlook stated it continues to favor emerging market corporate debt, over sovereigns, over high yield investment grade, and over hard currency.