The world’s most indebted real estate group has restored construction activities in 95% of projects to ensure the delivery schedule “at all costs”.
Evergrande said that construction work had resumed on 95% of projects across China by the end of March. The real estate group continued to operate with 734 developments, including 424 projects under construction. return to normal construction level.
“We will continue to maintain normal construction activities of projects to deliver houses to owners with guaranteed quality and quantity at all costs,” the business representative emphasized and added, The above recovery received much support from the local government.
Evergrande is the world’s most indebted property developer, with more than $300 billion in debt. This business is having difficulty repaying debt to bondholders, banks, suppliers and delivering homes to buyers. Evergrande is in trouble due to the Chinese government’s campaign to tighten leverage in the real estate sector.
Chairperson Hui Ka Yan has pledged many times since 2021 that the group will continue construction work at a level that fully guarantees delivery. In February 2022, he also shared with employees that Evergrande aims to deliver 600,000 apartments by 2022.
Recently, Evergrande was slow to announce its annual results, citing a “dramatic change” in the group’s outlook. The company promised investors that it would reveal its massive $300 billion debt restructuring plan by the end of July this year.
The property developer set up a risk management committee last December, made up of mostly state-owned company officials, led by the Guangdong provincial government. According to Mr. Liang Senlin – member of Evergrande’s Board of Directors – this business plans to sell the Nguyen Lang land in Hong Kong as well as the Evergrande Center commercial building to pay off some foreign debts.
On March 30, the group also said it would sell its Crystal City project in Hangzhou for 3.66 billion yuan ($575 million). Evergrande will use the proceeds to pay a construction fee of 920.7 million yuan to Zhejiang Construction Engineering Co., and the remainder to the group-wide working capital. The deal is expected to bring in about 216 million yuan.
Shares of Evergrande and other Chinese real estate companies jumped last week on the heels of Vice Premier Liu He’s announcement that the Beijing government would urge the implementation of market-friendly policies to support the economy. However, the debt crisis in the industry continued to worsen.
On the same day as Liu He gave his speech, China’s third-largest property developer Sunac was downgraded by the credit agency S&P. The reason is that this unit is concerned that Sunac may not be able to pay off a huge debt of nearly $ 4 billion due this year.
Xiao Gu (according to Reuters, The Guardian)
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