The Evergrande crisis is spreading. Here are other Chinese property developers who are in standard or wobbling.

Evergrande

Evergrande
Evergrande topples over the edge of standard.



China’s real estate developers have grown at a tremendous rate over the last decade, driven by huge amounts of debt. Authorities have begun to restrain them with strict debt limits, but it is not easy to snatch an addiction.

Evergrande is one of China’s largest real estate developers and among the most indebted companies in the world due to more than $ 300 billion. It squeaks under pressure and has recently failed to make several offshore bond payments.

Just before a 30-day grace period expired, Evergrande pledged $ 83.5 million on Thursday to pay interest on an offshore dollar bond. But it faces more deadlines around missed bond payments, and $ 45.2 million in interest falls due later in October. If Evergrande does not cough up, it will officially be standard.

The Evergrande crisis is now spreading to other developers, threatening to rock China’s real estate sector, which economists say accounts for about 30% of the economy.

Fantasy

Pan Jun Fantasia real estate developer China
Pan Jun is the President of Fantasia.



Perhaps the most worrying standard so far has been the medium-sized developer Fantasia. Earlier this month, it failed to pay a $ 206 million bond that expired on October 4, according to an application.

The standard was worrying because the company had only assured investors two weeks earlier that there was no liquidity problem, said Craig Botham, chief economist at Pantheon Macroeconomics.

“A lot of Chinese developers are in more fragile positions than their balance sheet shows,” he said.

Fantasia is smaller than Evergrande with revenue of $ 2.76 billion in 2019 compared to Evergrande’s $ 69.15 billion, according to Bloomberg data.

Sinic Holdings

Sinic Holdings China real estate developer
Sinic Holdings defaulted on a bond payment on Monday.



Sinic Holdings defaulted on a $ 250 million bond and interest payments on Monday, Bloomberg reported. It is another medium-sized real estate developer with a turnover of $ 3.91 billion in 2019.

Evergrande-related stress has slowed sales in the real estate sector and increased borrowing costs and increased pressure on developers like Sinic.

Yields on more risky Chinese dollar bonds – which are major sources of financing for developers – rose to 20% earlier this month.

Fitch Ratings downgraded Sinic to “limited standard” on Thursday.

China Properties Group

Wong Sai Chung China Properties Group CPG China developer
Wong Sai Chung is the CEO of CPG.



China Properties Group is significantly smaller than Sinic, but it is also in trouble. It said on October 15 that it had defaulted on $ 226 million worth of bonds in an application on the Hong Kong Stock Exchange.

There is likely to be some respite for developers this year, according to UBS. The bank’s analysts said in a note on Monday that they expect new property to start falling 20% ​​year-on-year in the fourth quarter, “bringing further downward pressure on the economy.”

Modern country

China property Evergrande
Modern Land is another developer under pressure.



Modern Land asked earlier in October to postpone the payment of a $ 250 million bond for three months until January, saying it wanted to take steps to “avoid any possible default in payment.”

But the medium-sized developer, which owns 200 apartment and office properties across China, stopped these plans late Wednesday. It said in an application that it is facing liquidity problems and is seeking to hire financial advisers.

The president and president of Modern Land have said they will pump about $ 123 million into the company.

Xinyuan real estate

China real estate developer construction
Xinyuan has been forced into a distressed debt swap.



The pressure on Xinyuan led it to swap $ 208 million in dollar-denominated dollar bonds maturing in two years in a distressed debt swap.

The rating agency Fitch gave Xinyuan a “CC” score on Wednesday, which means that some kind of default is likely. Fitch said the medium-sized developer is facing a “tight liquidity situation with weak financing access and large maturities for offshore bonds over the next twelve months.”

Greenland Holding Group

Greenland Holding Group China construction real estate developer
Greenland is among the largest property developers in China.



S&P Global Ratings downgraded Greenland earlier this month, a massive developer with revenue of $ 61.98 billion in 2019. It received a “B +”, which means it is currently able to pay its debt, but is vulnerable in the face of a shock.

Greenland is struggling as its borrowing costs skyrocket during the Evergrande crisis, with domestic and foreign investors now much less eager to lend to real estate companies.

“The company’s cash may continue to be depleted over the next 12 months due to weaker sales and fundraising,” S&P said.

Insider contacted all property developers mentioned in this article for comments, but no one responded.

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